A year after Google (GOOG) began charging companies for Google Shopping product listings, the listings (i.e. PLAs) are providing a boost to Google's search ad sales, and also aiding its battle against Amazon (AMZN) for e-commerce traffic.
On both PCs and mobile devices, PLAs, which are accompanied by images and placed in a separate box, appear at the top of Google search result pages for product queries. Adobe's ad research arm estimates the ads are clicked on 34% more often than text search ads, and ad services firm Kenshoo estimates each dollar spent on PLAs produces $9 in sales.
The number of U.S. PLAs tracked by Jefferies has risen 99% Y/Y to 236K, and the number of advertisers using them 55% to 8.7K. Those figures exclude a mobile PLA product that was recently launched. Also: ChannelAdvisor reports seeing triple-digit Y/Y growth in holiday PLA spend by clients.
Though Amazon spends a healthy amount on Google search ads (inc. PLAs), the fact consumers are more prone to visit Amazon directly and bypass Google search has made the share-gaining e-commerce giant an indirect threat to Google's ad sales. In addition, Amazon's own e-commerce ad ambitions have been growing.