On July 23rd, the world of search advertising awoke to the surprising decision by Amazon to leave Google Shopping. This unexpected and multi-million-dollar move left many questions regarding how it could impact the entire global advertising ecosystem. The theory held that among the potential consequences would be, very likely, a reduction in CPCs due to the sudden decrease in competition resulting from the withdrawal of such a giant. In addition, brands would have an opportunity to gain greater visibility and share of impressions in Google Shopping results,
It seemed like the ideal scenario for advertisers, but the reality is much more complex.
The answer, according to a new study by Optmyzr, is more complex than it seems.
Their analysis, which was based on data from over six thousand accounts, showed a clear pattern. After Amazon’s departure:
In other words, advertisers received more traffic and paid less for it, but generated less revenue. The study explains this paradox because the traffic was not neutral: these were users specifically searching for Amazon, with expectations shaped by years of convenience, fast shipping, and aggressive pricing. When clicking on ads and landing on competing sites, many ended up purchasing less or sought lower-value products.
The authors refer to this phenomenon as the “volume trap”: an increase in clicks and conversions that does not translate into greater profitability.
And in fact, it makes perfect sense. Even if one eliminates the obvious draw that the name “Amazon” may hold for users, it is important to consider that there are more than 200 million Prime customers worldwide. People who, when faced with similar pricing, will always tend to purchase on the platform where they have the ability to receive fast and free shipping.
However, not every industry reacted in the same way to Amazon’s disappearance. The study’s results, broken down category by category, reveal which players were prepared to capture that traffic—and which were not.
Here, clicks rose by 11.5%, the CPC decreased by 7.1%; but the most noteworthy aspect was the jump in conversions: +81%. The ROAS also increased (+7.1%), as did the conversion value (+10.9%). Why? Because in this vertical there are actually players that can compete head-to-head with Amazon. Major brands and marketplaces offer competitive pricing, fast delivery times, and a trusted reputation. In other words, they were able to meet the expectations of consumers who, unable to find Amazon, were searching for a credible alternative.
With a 13% increase in clicks and stable costs, it initially seemed positive for Home and Garden. However, the conversion value dropped by 7.5% and ROAS regressed. While customers did arrive, they spent less. Here, the inability to provide Amazon’s convenience weighed more heavily than the gain in traffic.
Meanwhile, sporting goods became the perfect example of the volume trap. Although conversions increased by 20%, the value of those purchases plummeted by almost 10%. Consumers, enticed by the additional visibility, ended up buying cheaper products or simply did not find the shopping experience they expected.
Clicks increased by 12% and conversions by 14%. However, the value remained flat. More items were sold, but not at higher value. The only relief for advertisers was that the lower cost per click (-11.5%) helped keep ROAS almost stable.
With more than one thousand accounts analyzed, this high-volume category clearly demonstrated the sector’s fragility in the face of Amazon. Conversions dropped by 7.4%, value by 9.5%, and ROAS by 7.3%. Amazon’s fashion category had conditioned consumers to expect a wide selection, low prices, and easy returns. Competing in that space proved to be extremely challenging.
As we can see, on Google Shopping, Amazon not only competed in advertising auctions: in some ways, it also influenced consumer expectations in its favor. Shoppers have not immediately adapted to the new Shopping landscape. They continue to seek speed, aggressive pricing, and a frictionless purchasing process. And if they do not find it, clicks result in mediocre outcomes.
The key lesson for advertisers is that it is not enough to simply fill the void left by a giant. Users arrive with a set of expectations which, if you are not able to meet, quickly become a liability.
The study’s authors urge brands not to be tempted by clicks alone. It is essential to always monitor value-driven metrics, such as average order value and ROAS, for a sound strategy. The goal is not to become the new Amazon, but rather to find a space where your unique proposition stands out—without falling into the volume trap.
Amazon has left Google Shopping, but not the minds of consumers. And as long as these expectations persist, competition will not be about volume, but about value.
Image: Flux Schnell
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