What is Google getting out of Checkout?
Obviously, Google Checkout transactions are costing Google money. Regardless of volume, they can’t process credit cards for free. Their initial percentage of ad spend towards processing fees seemed like it’d make sense as a motivation, but when they changed to free transactions for the rest of 2006 and then through 2007, I started to wonder. Especially when they added the $10 incentive.
What is Google really up to?
On my way home from Nebraska People Making Money Online (it was cool - thanks Jeremy), it suddenly struck me.
Google knows who you are if you have a Google account, which not everyone has, but not much more. As they’re pushing towards personalization of the search results, which thankfully hasn’t affected base optimization too much yet, they need more people with Google accounts. Offering free processing, which gets online sellers excited to use it, also allows online retailers to get users signing up for accounts for them.
But wait - there’s more. Not only can they now get more people signed up with accounts, but they actually know where those people live. That’s right, your credit card billing address gets verified when you add it as a payment option. So now they know where you live, which helps them better target local search results and really tailor personalized search for you.
I think Google Checkout, which obviously affects OneBox results with the extra link for items available through checkout, is going to help them roll out personalization in a big way. It was partly a smokescreen, and the discounts were part of the fuel for the fire. Who ever said Google’s not a brilliant marketing machine?
Comment by your_store | February 23rd, 2007
While they can definitely get the users’ information, I really think G is more interested in advertisers’ sales data. A lot of people that would never touch G Analytics are using Checkout, which means a ton more data on conversion and ROAS.
Roll all the into a ball, and G has a damn good idea of how much money you’re making with Adwords. With that knowledge, they can squeeze as much Adwords out of you as you can possibly afford.
Comment by Christian Cadeo | February 23rd, 2007
Excellent point and one which makes perfect sense as it seems that all of the Google executive are out in force talking about the upcoming era of personization.
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Comment by psurplus | February 26th, 2007
No joke Google wants all the data they can get. Have you seen the thousands upon thousands of computers in their data centers?
But really, imagine the power Google will have at offering ad purchases for extremely defined demographics. ESRI, Neilsen ratings, etc won’t have nearly as much data as Google regarding this type of data.
Example- you have a Google account and search Google Base for a new Lexus IS350, white with tan interior (after all we’re using new attributes). You purchase the car, get online statements of your loan to your Gmail. You purchase a Lexus keychain to match the new ride and then next time you search Google for “tan Lexus floor mats” it already knows to show listings for IS350. Advertisers can pinpoint geo targetting and so much more. The possiblities are endless!