Thursday, January 3, 2013

Google shopping paid model caused by loophole

Nobody seems to believe Google's explanation for turning Google product search into fee based listing.  That you have better information and higher accuracy.  This is very true.  But what Google didn't tell you is that shop owners find nasty way to game Google's system.

Many shoppers have seen the loophole being exploited.  They just didn't connect the dots.  As for analysts, how often do they actually test the products of the company they analysis?  Did they ever know anything other than financials? (Or not even that?)

It's too easy to game Google's system.  Get a e-commerce website.  Select a product for an incredible low price.  Make sure that people actually can't buy the product.  Then you will get free top ranking in Google product search.  Hopefully buyers will take a look at the real products in your store, or you use the hits to your advantage for something totally different.

At first it was a test.  For example you have to have a lesser known credit card to get the bargain, if it actually exits.  Then it was all over the places.

Google tweak the algorithm to bring them to the back but the impossibly low price stills come up to confuse consumers.

I suspect Google have nothing to combat this as Google search is based on popularity, and the lowest price is the most popular.

This problem will evaporate once payment is involved.  You can identify sellers and can sue them for violating agreements.

Google's multi prong strategy is always interesting.  A Google product doesn't need to be market leader.  It's good to complement Google's overall product offerings, and just as good to generate internal competition.

When Google shopping was free, I use it as a mega search engine including eBay and Amazon.  It pays to advertise there even if you don't sell on both.  With the paid model, Google is still differentiating itself.  You develop your own website and choose whatever payment system you fancy, include Google Wallet.  Google can actually charge you 3 times, the listing, the payment and the advertisement.

eBay will go back to being for small sellers and buyers having too much time on their hands.  It's worse.  Paypal once accepted DHgate, a direct buy from China website.  But then they have to back out because of too many dishonest merchants.  On the other hand, their adult session becomes DHgate or Aliexpress.  If you have a killer product, you want to sell on Amazon for highest impact because of the reviews.  Amazon becomes a place for sellers to bid for buyers.  You can change price on the fly to out do competitors. 

Google shopping seems to be doing OK.  And I can offer you reasons.  Products sell at different prices.  Panasonic sells online direct, via wholesale, who may have their own e-commerce sites, and also on Amazon (eBay).  Nowadays Amazon often don't have the best prices.  I actually paid more on eBay and Amazon for some Chinese made gadgets, in return for better protection and better return policy.  If you want the best price you still need Google.

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