This post is by Daniel Sperling-Horowitz, the President and Co-founder of Zentail.
On Monday, March 19, 2018 Google quietly published a blog post that set in motion a major change to the ecommerce landscape.
Wherever shoppers are looking for products on Google’s vast advertising network, they can now check out directly on Google without being redirected to the merchant’s webstore.
Shopping Actions, as it is called, is Google’s new universal hosted checkout experience spanning major properties. These include Google Express, an exciting shopping mall featuring some of the largest names in retail including Target, The Home Depot, Walmart and Costco.
Merchants in the Shopping Actions program pay a fee per sale (“pay-per-sale”) instead of the traditional pay-per-click (“PPC”) Google Shopping advertising model. This commission-based model holds significant promise for merchants. Marketplace sellers, for example, can diversify their online sales mix without taking on the challenges of PPC campaign management.
Google-hosted checkout flow
The universal hosted checkout experience is core to Shopping Actions.
With Shopping Actions, merchants should expect to achieve higher conversion rates at a lower cost, than when participating in Shopping Ads alone. Shopping Actions listings and ads are displayed across a range of web properties and interfaces including Google Express, Google Search, and Google Assistant.
No matter where your customers decide to buy, they’ll enter a beautiful, seamless checkout flow connected to their Google Account. That means their email address, phone number and in many cases payment method, billing and shipping address are already on file. This eliminates much of the friction in the checkout flow that leads to abandoned carts.
Prominent retailer branding
It’s clear that Google has placed an emphasis on prominently branding the independent merchant.
Let’s take Google Express as an example. From the Featured stores section of the homepage to the Stores directory, branded storefront, product listings and checkout, the shopper is always conscious of who they are purchasing from.
Unified listings and crowd-sourced product reviews
With Shopping Actions on Search, Google maintains one listing per unique product just like on Shopping Ads today.
A retailer can surface one product on Shopping Actions on Search, and a variant of that product in traditional Shopping Ads. In order to provide the most robust product information, Google accesses product attribute data from multiple sources, so don’t be surprised if another merchant’s data ends up being published instead of yours.
Google Express is seeded with product reviews from reputable sites across the web to help shoppers make confident purchasing decisions.
The affinity buy box
So how do you win the Shopping Actions “buy box”, when other merchants are selling the same product?
Google awards the buy box to merchants based on several criteria including price, shipping speed, inventory location, merchant selling performance and the merchant’s existing relationship with the shopper.
If a shopper has purchased from a merchant in the past without any issue, and the shopper is searching for a product that is offered by that merchant, Google will weigh “affinity” when awarding the buy box. If all else is equal, a merchant that already has a relationship with the shopper will be showed more prominently than a merchant that does not have a relationship with the shopper.
For this reason, we believe an early mover advantage in the Shopping Actions program is critical for merchants that sell competitive products.
Should you participate in Shopping Actions?
While participation in Shopping Actions comes with significant benefits, we believe it is also important to understand the potential trade-offs.
Since Shopping Actions transactions occur on Google’s hosted checkout experience, shoppers will not be redirected to your webstore. For most merchants, this is a welcome change since conversion rates, average order values and repeat-purchasing behavior tends to be boosted by Google’s low-friction, retailer-branded experience.
Although the transaction does not occur on your website, if the user opts into the marketing choice, you will receive the customer’s email address and can market to the customer post-sale.
What about traditional Google Shopping?
Traditional pay-per-click Google Shopping campaigns are not going away.
We view Shopping Actions and Google Shopping as two separate but overlapping customer acquisition channels. Accordingly, we believe investment in your own webstore and PPC Google Shopping campaigns should be a core component of your multichannel ecommerce strategy.
How are Pay-Per-Sale commission rates determined?
Pay-per-sale commission rates vary by product category.
While there are no publicly available Shopping Actions rate tables, merchants should expect similar fees to other major shopping channels. Eligible merchants enrolled in Shopping Actions can review commission rate tables within Merchant Center.
Who is eligible for Shopping Actions?
Shopping Actions eligibility is reserved for experienced merchants, with a proven track record of superior online retail performance from a service-level perspective. That’s not to say you must be a top 1000 internet retailer, or a top-performing advertiser with Google AdWords.
To be eligible for Shopping Actions, you are reviewed based on product catalog, service level capabilities, business registration, and Google AdWords experience.
Your product catalog must include products in approved categories. For example, nutritional supplements are not currently eligible for participation at this time. For more information, here is a list of prohibited and restricted content as it relates to Google’s advertising programs more broadly.
As for product condition, only new condition products are eligible at this time.
Shopping Actions is currently only available to merchants and shoppers in the United States.
Shopping Actions onboarding
Eligible merchants admitted to Shopping Actions will need to integrate with Merchant Center and the Orders API.
Merchant Center is the central admin portal for managing business information, shipping and sales tax policies. Most critically, product and inventory data needs to be integrated into Merchant Center.
Once your product data and real-time inventory is in Merchant Center, you will move onto order testing. Orders are not tracked or managed in Merchant Center. Instead, you access orders via the Orders API. Once connected to the Orders API you will need to process test orders to ensure your ability to receive orders and status updates, communicate tracking and handle cancellations, returns and refunds.
Summary
Google’s Shopping Actions is a re-imagined distributed ecommerce platform. It helps shoppers take action with a low-friction checkout experience across search, Google Express and Voice Assistant.
The universal hosted checkout flow, featuring pay-per-sale transaction fees, will surely attract participation from leading multichannel merchants.
Will you be one of them?
This post was by Daniel Sperling-Horowitz, the President and Co-founder of Zentail, a multichannel ecommerce platform and Google Partner with a pre-built Shopping Actions integration.
Should look into Google's practice of payment holds when using a third-party processor. Four-week holds are terrible for small sellers.