Tuesday, March 27, 2007

Google AdWords PPA will Save the Long Tail!

Can you tell I like Google’s new PPA idea? When I was selling with Glacier Bay DVD and was trying to increase search activity to my website I looked at Google’s AdWords as an option but quickly came to realize that with my limited resources it wasn’t a viable solution. I couldn’t take 6 months to fine tune my ad campaign and I didn’t have the cash to take a chance on the program. Had PPA been in existence that would not have been the case.

With Google's PPA program, an online seller is no longer limited to finding the perfect keyword list, since they can choose a set fee ($1) for a specific action (sale) a seller can now list all of their keywords and need not worry about click fraud or spending too much on clicks that don’t convert -- the Long Tail will now be available in search. I had over 200,000 SKU’s but could only afford to advertise a small number of keywords; with PPA I could list all 200,000 titles knowing that I will only pay if there is a sale. Imagine the opportunities!

For eBay Store Sellers they now have options: they can move off eBay to their own webstore and advertise through AdWords PPA or they can now afford to advertise their eBay Store products through Google AdWords. They can use eBay's referal credit (75% off the FVF) to drive buyers to each of their items, for example, on a sale of a $10 item they would normally pay eBay $1 in FVF, with the referal credit they would get a credit of 75 cents. As long as their fee for PPA was less than 75 cents per sale the seller would save money over a sale made directly through eBay.

The world just opened up to the online seller and the Long Tail just opened up to the World. Good job Google!

Google's PPA is truly a disruptive application. Here is a list of possible disruptions:

  • Currently 37% of all product purchases originate in search; that percentage will grow exponentially as there will be no need to go to a marketplace like Overstock, Amazon or eBay to find the product you want. IT will now be found in Google Search. Sure Amazon, Overstock and eBay will continue to do business with their existing customers but this effectively puts a damper on growth.

  • Google Checkout will see its adoption rate increase as Google merchants get priority placement in search.

  • Affiliate Programs will be affected. Google's PPA has just become the "World's best Affiliate Program".

  • The seller of the Long Tail can now afford to advertise; benefiting small business and empowering buyers searching for that hard to find product.

  • eCommerce will grow by leaps and bounds. Buyers will start most of their product searches with Google.

  • 3P (Third Party) Sellers now have direct access to search at a manageable cost, sure they will stay on sites like eBay, Amazon and Overstock for access to their customers but the door has been opened to the rest of the world now.

  • Big business still has the advantage because they retain pricing power.

I'm sure there are many more disruptions that I have neglected to include but you get the point. This is going to be an interesting year.


me.Blog said...

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roshan said...

Its nice to read the article. Online affiliate marketing is one of the most effective, cheapest and fastest ways to promote merchandise. As millions of people getting access to the Internet everyday, there is a great chance for a merchant to introduce his products and services to a wider market, thereby, maximizing his revenue. For more information on online affiliate program check the link .

Chairman said...

Very interesting , I had not heard about this beta

This feature will help me promote my rare Russian ,Ukrainian Slavic books. Using Adwords before did not always work very well or make sense in some cases.

This feature will be ideal for me ;)

Thanks for the info

-Slavic Books Biz

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