Photograph by Dado Ruvic — Reuters
By Erin Griffith
May 21, 2015

Today at the ad:tech conference in San Francisco, Sridhar Ramaswamy, Google’s senior vice president for ads and commerce, introduced a new ad product called “TrueView for shopping” which allows viewers to shop for items directly from YouTube.

It isn’t a buy button—YouTube will not be facilitating the transaction. Rather, it sends users to third-party sites to purchase goods that are related to the videos. The ads appear as an overlay on the video. It’s one step closer to the advertising world’s pipe dream of “shopping the show,” or letting a TV viewer buy what they see on the screen, the company says.

It’s also another way for Google (GOOG) to combat Amazon (AMZN), which some believe eaten into its product-related search queries as shoppers go directly to Amazon.com to search for products, rather starting with Google. If Google can make YouTube into a starting place for product searches, the company can grab more direct marketing advertising dollars.

“Our motivation overall is that there is a pretty big generational shift happening when it comes to videos,” Ramaswamy says. “For the longest time, I would look at catalogues to figure out what to buy. My teenage sons are much more likely to search for videos. This shopping format tends to be an extremely natural addition to how people think about buying.”

Shopping buttons make sense for categories of YouTube videos that have direct commerce tie-ins. The video platform has more than a million channels solely focused on product reviews. Searching for recipes, or an activity to do, or a how-to video are also opportunities for shopping ads, Ramaswamy says. Almost two thirds of brands see Google searches rise by as much as 13% after viewers watch their ad on YouTube, he noted. The idea is that an ad with exact product in it eliminates the need for a follow-up search.

TrueView for Shopping, like any new ad format, risks annoying users or creators, but Ramaswamy notes the overlay ad windows can be closed with click, and video owners have the right to decide whether product ads go on their videos. Likewise, video creators get a revenue share of any ads sold against their videos. “Formats are always a work in progress for us. As a team, we constantly experiment,” he said.

In experimenting with Google and YouTube’s mobile and video ads, the company noticed an abundance of shopping-related queries on mobile, even when users are physically present at a store. “The conventional wisdom is that it’s comparison shopping for price, but many times they’re interested in product reviews,” Ramaswamy says. In this way, Google is hoping to not only provide the search engine, but also the desired search result.

Google has recently expanded its e-commerce ambitions with Google Express, a shopping service, and Google Wallet, a way to streamline the online check-out process, but a recent pair of executive departures, as reported by Re/code, has raised questions on the search giant’s commerce plans.

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