People shop on Google more than a billion times a day. But until recently, the search results tended to come from big brands that paid big bucks to promote their listings. When I Googled tie-dyed T-shirts, the top results were from Gap, Zara, Lululemon, and Amazon. But that is soon about to change.
Yesterday, Google announced that it is transforming its online shopping experience by making it easier for people to discover smaller brands and local mom-and-pop stores. Google is partnering with Shopify, a company that makes it easy for people to start an online store, to create a simple process for 1.7 million merchants on the platform to feature their products on Google Search, Shopping, YouTube, and Images. This means it should be easier to find a cute tie-dye outfit from an indie store in my neighborhood.
These changes come at a time of major retail innovation. Social media platforms such as Instagram and Snap are investing in technologies that allow users to discover and instantly buy from a wide variety of new brands, including tiny startups that sell entirely through social media. Google is eager to compete with these platforms by making it easier to discover smaller brands, too. “E-commerce for the past 15 years has had a concentrating effect,” says Bill Ready, Google’s president of commerce and payments. “The vast majority of growth over the last decade have come from a handful of very large e-commerce players.”
Even though online shopping has improved over the past several years, it still has a few problems. Brands tend to target consumers with ads based on a few details about them, such as their shopping behavior or demographics. This means that we are often served ads from e-commerce sites we’ve recently visited—and chose not to buy anything from. We rarely see products or brands that are truly different from what we’ve previously searched or purchased. What we really need is a platform with a vast range of options, so we can stumble across new things that interest us, the way we would if we were strolling on a shopping street or browsing a department store. No shopping platform has quite achieved this level of discovery, but Google might be getting closer by bringing millions of new products into its search engine.
Until recently, the only brands that showed up on Google Shopping were those that paid to advertise their products. The privileged brands that could afford to pay these fees (which could easily go into the tens of thousands of dollars or more) depended on the specific product category. But last summer, Google said it would make it free for any retailer to list products on Google Shopping. Those same free listings would also appear on Search.
It is still possible for any of these brands to pay Google to promote their listings so they appear higher up in the search rankings, next to an icon that identifies them as an ad. But millions more products now appear in organic listings underneath those. Google also does not take any commission for product sales that come from searches. Ready says that making these listings free led to a 50% increase in clicks from consumers. “It just makes sense,” Ready says. “Now they are able to discover and shop all the world’s products and inventory, not just brands that are paying to promote.”
Starting today, there will be even more. Shopify will enable all of its merchants to click a button to publish all of their inventory across all of Google. In the past, these merchants would have to spend days or weeks making their products discoverable on Google, and many smaller shops did not have the bandwidth to do this. “Last year we removed the financial barriers; this year, we’re removing the integration barriers,” Ready says. “Technically, it’s now very simple to publish your inventory on Google.”
Given all the new products now flooding Google, the platform runs the risk of overwhelming users. So Ready says the company is thinking carefully about how to curate search results for each individual user. Behind the scenes, Google has developed an AI-powered model called the Shopping Graph that tracks the constantly changing inventory on Google and tailors this information to the user. It considers the user’s interests and previous shopping behaviors when showing results. (It builds on Google’s Knowledge Graph, which the company has used for decades to curate search results for users.) “Users are increasingly expressing their own preferences directly,” he says. “They say they want to shop locally or from minority-owned businesses. They want to shop their values.”
For Google, opening up its search to all these new products and merchants is a lucrative move. While brands no longer need to pay to list their inventory, many might be motivated to pay to promote their listings. A neighborhood mom-and-pop store may not have listed any products on Google previously, but now that their inventory shows up, they might want to promote certain products to local users. Ready says that since it made listings free, smaller businesses have started advertising their products. But he makes it clear that they don’t need to do so for their products to still show up. “If they make a product that is relevant for a particular user, they will show up in that user’s search, whether they’re an advertiser or not,” he says.
Ultimately, Ready believes that leveling the playing field in e-commerce will benefit the consumer, which will eventually benefit Google. If we find it fun to shop on Google, we’ll spend more time there, which will motivate brands to spend their marketing budgets on the search engine. “We want to make sure consumers in the digital world have the same amount of choice or more than they have when they’re walking down the shopping street in their neighborhood,” he says. “That includes a small business or a store they’d never stumbled across before.”