Google is floating a new CPA (cost per action) model for Adwords advertisers who target US cities and states. If you are one such advertiser, just open up an account with Google Merchant Center and include as much information as possible for your products like accurate descriptions, images and price.

Merchants who have large product inventories now do not need to create ads. Just do your basic keyword research and determine the ones for which you want to show your ad. You pay only for the results and as the ads are charged on a CPA (cost per action) basis rather than CPC (cost per click). Thus, risks are lesser and a lot of time will be saved too as the advertisers can just update the merchant center with relevant information (and possibly keywords).

Currently, product listing ads are available only to a handful of advertisers but should open shortly for all advertisers across USA and may be other countries too.
Millions of users flock to Google everyday for product related searches and though the Adwords system gave good responses, it was becoming essential for Google to tap into the profit margins that can come from direct product display. Google now eyes a bigger chunk in the product sale process and has planned to offer selling through advertisers directly instead of serving as a traffic stream for shopping sites like shopping.com, ebay.com and amazon.com.

Google lists Adwords ads above organic search results too and that means that eventually these results can be blended there too. Add this to the “Universal Search Results” which searchers see all the time now. Yeah, it is the blending of other Google verticals like Google news, Youtube, Google base and the one box results for location modifiers.

With the CPA model, Google provides the advertisers a lucrative “you only pay if they buy” advertising model and product managers will be happy to take it even at very high CPA rates to increase stock movement even if it means that new customers are acquired at a no profit no loss point. And relying solely on someone else’s business model is not a long terms strategy.

All these changes collectively mean that the traditional “organic SEO” model is in for a threat very soon, sooner than expected. How would you buy mindshare even if you spent hundreds of dollars for getting up to that number one spot only to find that the number one spot in way below the fold on the SERP. Google is no more a search company; it is an algorithm driven portal now that intends to be your super duper affiliate.