Google recently announced a new product called Google Shopping that will improve the online shopping experience. It allows online shoppers to easily research purchases by comparing different products, features and prices, then directly connect to merchants to make their purchase. Google will phase out the free clicks on Google Product Search listings and retailers will bid for placement of their products in search results in the new Google Shopping program.
Google Shopping will be built on Product Listing Ads and will be a commercial model in the fall of 2012. Google believes that having a commercial relationship with merchants will encourage them to keep their product information fresh and up to date and will lead to higher quality data and a better overall online shopping experience for users.
Google is giving merchants a few months to transition to the new Shopping model and is offering incentives to merchants who create Product Listing Ads before mid-August, as well as incentives to merchants who have already implemented Product Listing Ads.
The new shopping tool will use a combination of relevance and bid price to rank products. Instead of merchants bidding on keywords, merchants buying Product Listing Ads bid on the amount they will pay if their product listings in search results attracts clicks or result in sales because, Google Shopping will have two models — cost-per-click or cost-per-acquisition.
Below is a screen shot of what Google says the new Shopping program will look like on the search engine results page.