Why Amazon Refused to Buy Google’s Product Listing Ads?

Think about it: would you choose to earn millions every month or would earn the same amount and share the half with your strongest competitors to ease the task? In answer to this question, Amazon’s CEO Jeff Bezos decided not to buy Google’s product Ads, no matter how many millions they earn with it.

You may be surprised to know that once Google and Amazon were in the tech leader’s race together. Each of them wanted to become the biggest tech player around the world on their web related business. Both were helping hands to each other. Google was the main resources for Amazon to deliver more and more customers every day. This is because people used to search products and services on Google and Amazon being the top ranked site, got the most of its traffic. At the same time, Amazon used to be Google’s number source of income. This is because for every customer, Amazon used to pay Google.

In today’s world that is ruled by Google, there is nothing like a genuine agreement. Amazon and Google tried to enter and be the leader in retail branch as well. One example of Google’s effort is its Boutique.com that was launched in 2010. But it flopped and Google merged it into product search.

On the other hand, Amazon proved to be a sleeping giant of the marketing and advertising world. Undoubtedly, Amazon has a huge customer base, but it never thought of entering the marketing world, which could be even more beneficial for this shopping giant. But everything changed when, in October 2012, Amazon announced Amazon Advertising Platform (AAP).

According to Amazon’s global head of advertising, Lisa Utzschneider, Amazon is focused on a globally scalable advertisement business and trying to figure out different ways to improve customers’ experience on the Amazon platform. These efforts are continuous since last few years. This announcement made by Amazon, was like the declaration of a way between Amazon and Google. Overall, what once started with harmony between two giants later became a strong rivalry of two superpowers on the Internet, declaring the open battle in the end.

Google and Amazon Wants to Become the Number 1 Search Engines for Product Searches on the Internet.

Whatever dispute both leaders have, they share a similar end goal: to be the sole destination of the people who search for the products online. And, Amazon is winning this battle, according to market insider Michael Griffin.

But, now, it is Google who won the first battle over Amazon. Google’s success can be, undoubtedly, attributed to the Google’s Product Listing Ads and the switch to a paid shopping platform, called Google Shopping.

With this move, Google behaved like killing several birds with one stone. First, it increased the data relevancy and user-friendliness for retail product searchers with Google. Second, As compared to straightforward PLAs that includes product images and price, organic search results lost relevance. Lastly, Amazon earns on a commission basis; it earns with every sale. But Google earns from every click on the ads.  Sellers find it easier to set up Google shopping campaigns rather than selling on Amazon marketplace.

Amazon strikes back: Product Ads á la Amazon

Finally, Amazon decided toinclude product ads itself. They were already doing this in the USA only at a low scale. Now, they decided to expand and make money through pay-per-click ads on their own website and increased its product promotion efforts. It was launched in Great Britain, Germany and France, and ads appear on the Amazon site now.