Started from September last year, Google Shopping US started to only show Google Product Listing Ad (PLA). Merchants need to place a bid to display their product listings in the site. They also need to pay for the click/traffic generated from Google Shopping.
Normally, such a move will drive merchants / retailers to walk away. However, the opposite has happened. A Marin report said that their clients has increased spending in Google Product Listing Ad by 600 percents. Marin also found that PLA generally have a higher Click Through Rate (CTR) and lower Pay Per Click. That would be a signal for merchants and advertiser to increase their spend on this channel.
From product management point of view, this is a good product strategy to position PLA as a separate marketplace outside AdWords. The competition in AdWords is so keen that some advertisers have already thought that the PPC has grown so high even for those tail terms. To increase the overall yield from the search traffic, the best solution is to create a second advertising marketplace which has already built a tremendous user base.
Even through many merchants are not willing to see Google Shopping has become a paid service, they have no choice but continue to use the service because they need traffic from it.