Google Checkout & Affiliate Marketing

[Matthew Wood]

Late last week Google Checkout (GC) launched in the UK, offering merchants and consumers noticeable benefits. The affiliate networks themselves are currently being fast tracked through the 3rd party tracking approval process, and many have now been approved.

Google have been criticised by some for not ensuring pre-approval of networks before launch, however a representative from Google on a4u has confirmed that affiliate tracking is a core feature of the product and that tracking providers should contact them at checkout-api-support@google.com to get setup and approved.

The thought process should now turn to whether GC will be a good thing for Affiliate Marketing. I am presuming below that all networks have now been approved as third party tracking suppliers with GC.

As a merchant it seems like a pretty decent deal, you get £10 worth of sales for free (no payment processing fee) for every £1 you spend on Google Adwords. Now does this mean merchants will bring a portion of Adwords activity in-house? It’s feasible, however it would probably affect agencies more than affiliates, and there are certainly ways around any immediate problems for the benefit of all parties.

The merchant could increase sales via the current promotional offer of £10 off a £30 transaction, this will potentially increase their conversions and tease shoppers who don’t buy online to do so - Sales that otherwise could have leaked through to a sales hotline or to the high street; Both these have, in the current state of play positive results for affiliates.

So how can GC be negative for the space? Well a couple of things spring to mind. First of all the potential inflexibility to add sophisticated affiliate tracking technology to GC. If GC currently only supports 1x1 pixel trackbacks, this could be an issue for discussion.

Direct to merchant PPC'ers could attract unwanted clicks from intrigued surfers in the early weeks. With the GC logo appearing on ads which have the merchants main 'business url' - whether from an in-house or affiliate campaign.

Maybe networks have the most to worry about; does GC offer an decent in-road along with adwords and analytics to launch their CPA model? quite possibly yes, however networks are always diversifying and with support not historically Google’s core competence networks should prevail, something I guess we will all watch closely. After all Google has collected years of stats which could be at their disposal through adwords, adsense and more recently analytics. Checkout could be the final piece of the jigsaw to help them create a formidable player within the affiliate marketing space! - It is important to stick to the facts however, speculation can often be dangerous!

Now I’m not an expert on Google Checkout by any means, so let’s get some discussion here, what do you as affiliates and merchants feel?

[3wdl]

Good thread Matt.

I was having this conversation with someone on Skype today (who may well make themselves known on this thread at some point). Their argument was that google are getting too much data from this further channel.

As I mentioned on another thread so far by view on it is that if it can track as well as using a merchants own shopping cart then it is MORE of an advantage to use google checkout.

Why? The checkout will be more secure and less likely to break; after all, there have been plenty of occasions when tracking has been removed by mistake from a merchant site and this is less likely to happen with google checkout.

Also - Payment processing has always been a big barrier to getting started online and hopefully google checkout will bring change in this respect and lower the price of major suppliers.

Time will tell but after all the tracking is sorted I think we could see some nice stats coming - especially with the free £10 offer that they currently have.

[BFG 9000]

Originally Posted by 3wdl The checkout will be more secure and less likely to break; after all, there have been plenty of occasions when tracking has been removed by mistake from a merchant site and this is less likely to happen with google checkout.

I'd beg to differ here - the code still needs to be in place on the merchants site - the merchant has to send it with every order xml request to google - there is still just as much room for a merchant to break it....

I do however agree with (what I think is) your main sentiment - that google checkout will be a good thing in the long run.


TTFN

BFG

[Qui Gon Jinn]

At the moment it seems like we are playing Russian Roulette. Whilst the initial adoption of Google Checkout maybe slow, it will gather momentum, then affiliates & networks will be left at the conscience & mercy of merchants to correctly insert the required coding for sales to fully track. (whether through ignorance and/or arrogancy)

As it unfolds we will gradually see how deep the rabbit hole goes for an conspiracy theorists and who is actually proved wrong & right. It's obvious I am no Google fan and have some firm opinions. However, as a whole though maybe reluctant, we all seem quite happy to accept whatever muck Google chucks at us when we should be more proactive in readdressing the balance for the longevity of affiliate marketing.

i.e. Nos 1 of Many .. How long do you think before Google Offers a Permanent Cashback Site Offering. Which will not only affect Cashback sites by offering 100% of the commission return to customers.

In the meantime wouldn't it be prudent for networks to introduce additional clauses in their contracts with the merchant if not already covered to protect both the network & the affiliate.

Otherwise we may experience an avalanche of problems where sales will go untracked for periods of time ranging from days to weeks where often the affiliate is first to identify the problem. btw I don't like the idea we are taking a step backwards to the forms of tracking it is compatible with.

[Matthew Wood]

In the meantime wouldn't it be prudent for networks to introduce additional clauses in their contracts with the merchant if not already covered to protect both the network & the affiliate.

A prudent suggestion Paul.

However if a merchant does play foul, then as always they will be caught with damaging consequences.

[drivetowin]

Paul

I see where you are coming from but is this tracking (once all networks are approved) any more likely to fail to track than any other - personally I doubt it - we all know that a certain percentage of all sales via whatever platform fail to track and I at the moment do not see any reason why Google Checkout should be any better or worse in that respect.

Certainly the feedback I have had from a couple of merchants that I work closely with is that they are very keen to implement Google Checkout (one currently uses Protx and one uses Paypal) so Google Checkout is obviously going to prove a threat to those companies.

I do agree with you wholeheartedly that it is disappointing that Google Checkout does not incorporate other tracking methods, that said I guess only Google know whether Google Checkout in its current form is the end goal or whether there are a number of developments still to come.

Google could offer a cashback solution but I doubt they would want to - the cost base to support it would potentially be very large, and as Matt points out large scale support is not something Google is particularly good at, nor I suspect an area they really want to get into - there are already 100% cashback sites like Quidco but they do not seem to have really dented the fortunes of leading cashback sites like GreasyPalm and rPoints and freefivers.

I can still remember the discussions on here when people were speculating that the launch of Froogle would see the end of many affiliate websites when if anything the plethora of price comparison sites has continued to grow rather than diminish.

Personally I am looking on the launch of Google Checkout with guarded optimism - if it encourages more merchants to venture online, and more people to buy online then ultimately that should be good for the affiliate channel.

[Qui Gon Jinn]

Keith,

Consumers may probably trust the Google Checkout logo (whether they should or shouldn't is another debate altogther)

How do you feel about the checkout logo being applied to affiliate ads for those doing direct to merchant linking without our permission? (It might make Ad stand out more & increase CRT but not necessarily sales. It maybe a case by case basis)

Froogle & Google Checkout could compliment each other quite well, we priority being given to merchants with Google Checkout.

Re Cashback sites : Could Google be looking to acquire an existing cashback site who will have the infrastructure & flexibility to dramatically expand it's consumer base & manage it? Where customer has to have Gmail (or convert to Gmail) and merchant has to have Google Checkout. .. hmmm .. I wonder which cashback sites have shares for sale.

[hpops]

Originally Posted by drivetowin Personally I am looking on the launch of Google Checkout with guarded optimism - if it encourages more merchants to venture online, and more people to buy online then ultimately that should be good for the affiliate channel.

My thoughts in a nutshell.
Coupled with lower transaction costs for merchants and a trusted brand to shop with for consumers I can't see that this won't increase online sales, surely thats a good thing.
Google do things to annoy me daily, they're arrogant, anti-competitive and so full of spin its amazing that they;re not a political party. But you can't deny that they are one of the driving forces behind increased take up of e-commerce, this latest move, however shoddily launched from our point of view crystallises this position and helps us all.

[drivetowin]

Yeah I take your point Paul about the Google checkout logo appearing in affiliate adwords ads - it will all most certainly increase the ctr but whether it increases conversion rate is a different thing - I guess short term it may well due to the Google £10 off baskets over £30 promo but long term I guess it won't and just serve to increase affiliate costs (another thought just occurs to me there, but I'll start a new thread later as I don't want to derail this thread).

Re the cashback thing - yes I guess it's always an option, in which case I guess it could be a good time to buy ipoints shares (since afaik that's the only one that has public shares available) - I can't see Neil, Richard or Matt rushing to sell a share of their sites - but even for the largest of those the potential increase would be huge (but so would the headaches).

Re the Froogle angle you could be write although Google seems to be increasingly reducing the effort it puts into Froogle (merging it into Google Base etc) so in my opinion it wouldn't be a great surprise in the UK at least to see Froogle quietly dropped some time in the next year or two.

[Rich]

Originally Posted by drivetowin I see where you are coming from but is this tracking (once all networks are approved) any more likely to fail to track than any other - personally I doubt it - we all know that a certain percentage of all sales via whatever platform fail to track and I at the moment do not see any reason why Google Checkout should be any better or worse in that respect.

It is limited to a web beacon/tracking pixel - none of the fancy javascript / cookieless / server to server tracking methods the networks are keen to promote (though server to server could possibly be implemented via the checkout notification api). Would the networks spend time on these methods if they didn't think they would track sales a tracking pixel would miss?

If the checkout logo shows next to an affiliate's ads, does that ad spend reduce the merchant's order processing costs? i.e if an affiliate spends £100 does a merchant get up to £30 of free processing (based on sales of £1000
and a £10 basket - £1000*1.5%+100*£0.15)