Google takes on Amazon by removing commissions on e-commerce platform1 min read . Updated: 24 Jul 2020, 10:00 AM IST
- Google is also letting retailers use third-party platforms like Shopify and Paypal to get on the 'Buy' on Google platform
- The project is in the pilot stage right now and Google will expand it to other sellers in the US over the “coming months”
NEW DELHI: Search giant, Google on Thursday announced a significant change to its e-commerce marketplace product, Google Shopping. The company will now let sellers — ranging from small retailers to big businesses — and sell products on its marketplace commission free.
“Soon, sellers who participate in our Buy on Google checkout experience will no longer have to pay us a commission fee," the company wrote in a blog post last night.
Google is also letting retailers use third-party platforms like Shopify and Paypal to get on the Buy on Google platform. The initiative is launching only in the United States (US) right now, but the company said it is looking forward to bringing it to international markets later this year and in 2021. Google Shopping itself though isn’t available in most markets right now, including India.
The company said that while retailers do use the product to drive traffic towards their website, many do use it for selling products too. “By removing our commission fees, we’re lowering the cost of doing business and making it even easier for retailers of all sizes to sell directly on Google," the company wrote. The project is in the pilot stage right now and Google will expand it to other sellers in the US over the “coming months".
The move marks a significant change in Google’s focus on the e-commerce business, which is led by fellow Internet giant Amazon. Social media company, Facebook, has also tried its hand at this through its Marketplace initiative and the Shops platform, which it announced earlier this month. Both Facebook and Amazon, though, charge a commission off sellers who use the services.
The timing is also important, since the global coronavirus pandemic has driven the use of e-commerce worldwide. For instance, reports show that the e-commerce market is expected to cross the 45% market in terms of coverage, for the first time in countries like India. Since more users have been driven to buy products online, the total addressable market has grown, which gives Google an opportunity to take advantage.
That said, the company may have an uphill battle, since users still usually check e-commerce platforms like Amazon etc. when they want to buy products. However, Google does get huge traffic for searches on product reviews, comparisons and other information, which the company could utilize to promote the Buy on Google platform.