Another revenue channel for Google: Product Search?July 12, 2010: 2:37 PM ET
An analyst thinks that Google's prominence in search will allow it to climb up the value chain in other highly profitable areas.
Analysts want to see what the next big thing is going to be from Google. Sure Google does a brisk business with advertising against search, but what other area of their business has real revenue growth potential?
These changes are transforming Google into a more competitive, closer-to-the-transaction eCommerce platform, with the potential benefit of: 1) bettering traffic share gains and 2) improving conversion rates (up to 30% in some formats), leading to higher CPCs.
How much could Google make? Post thinks that squeezing eCommerce intermediaries out of their referral fees could net Google as much as $1-2 billion annually over the next three years out of the rapidly expanding $10 billion global market.
Google's Product search product takes any of the millions of Google queries daily and matches it to various products in their database. If the user is interested in buying that product, Google can make a percentage.
While Google doesn't currently rank results by what kind of commission they would receive, they could potentially start to do this, increasing their revenue from product search.
Product Search has evolved to become the number one comparison shipping site. While Product Search has the potential to provide incremental monetization of $200 to $300 million per year, it is more likely that Google will continue to use Product Search data feeds to help funnel merchant data to higher value ad formats.