Is eBay switching search network partners from Y! to Google?

At ChannelAdvisor we have a product, SearchAdvisor, that is used by some of the largest retailers to manage their paid-search campaigns.  As part of the product, we take traffic from the big search providers (Google, Y!, Bing, etc.) and allow the retailers to look at the referrals (one click back) for that traffic.

This data is useful as you may see things such as Y! adding a new partner with very weak (or strong) traffic (usually measure by conversion rate) and then you can take an action such as decreasing bids for that traffic or elimintating or increasing bids.  Not all engines allow this kind of behavior and some only allow it on their content networks.

Anyway we keep an eye on this data and look for other trends of interest and found one this week that is pretty interesting.

eBay sponsored link program

For certain search results (depends on your cookies and a variety of other factors such as the number of results, etc.).  Here's an example  for a digital camera typo search:

In the US these ads are provided by Yahoo! and in International markets, they are provided by Google.  This was all setup in 2006 when eBay introduced the program (which I'm not a fan of BTW, but I've ranted about that enough in the last 3yrs).

What we are seeing...

Our referral data is showing an interesting trend - that traffic going from eBay->Y!->retailer is decreasing rapidly and traffic flowing eBay->Google->retailer is increasing.  This graph illustrates the trend.  In short we have seen a 47% increase in traffic flowing through eBay to Google in the last two weeks:

What's going on and what does it mean to me?

From the data it's clear that something material is going on.  It's either a test or all out switch from Y! to Google providing the sponsored links in the USA.

What does this mean?  Well, in general, eBay and Goog haven't gotten along to well together.  So maybe this signals a thawing out between the two companies?  Of course, eBay is pretty tight with Bing these days (cashback) who is taking ovver the Y! search engine so it will be interesting to see if they get aggitated and send some cashback love elsewhere.  Or heck, maybe this is a negotiating tactic to get Y!/Bing to up the ante on a combined cashback/sponsored link program.

Well if you're an eBay seller, there really isn't anything this means for you other than it's another way you can get your products on eBay.

If you are a Google advertiser, you should keep an eye on conversion rates as eBay traffic from this program tends to convert at the bottom of the search traffic bucket.  Unfortunately Google doesn't allow you to exclude this kind of traffic from the search network, but if enough retailers share concerns with their account managers (hint hint), that could change.

Finally, this blog has a large investor/wall st. readership.  If (that's a big IF) eBay is switching, I'm sure there's an economic driver so this could result in an increase in advertising revenue. To my knowledge eBay doesn't break out the this program specifically, but they have announced they are getting rid of the banner ads on SERPs so perhaps the loss of that revenue is driving eBay to look at a different partner.

What do you think?  Chime in on comments!

SeekingAlpha Disclosures: I am long google and Amazon

Comments

[Mrugesh]

If ebay will merge with google, it'd be an awesome business. Google is more genuine and real. They know the business. Best of luck Ebay.

[Florea]

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