Amazon exits Google Shopping globally causing 30% CPC collapse

Amazon eliminated its entire Google Shopping advertising presence across global markets between July 21 and July 23, 2025, according to multiple industry analysts tracking the unprecedented withdrawal. The e-commerce giant's median Shopping ad impression share crashed from approximately 60% to 0% in the United States, 55% to 0% in the United Kingdom, and 38% to 0% in Germany during the 48-hour period.

The withdrawal created immediate cost-per-click reductions of 25-30% across affected markets, according to Dolnai benchmarks cited by Manuel Arrufat, CEO of the Madrid-based advertising analytics company. "Amazon drove the largest overlap rate in 27 of 30 retail verticals," Arrufat noted through LinkedIn on July 25, 2025. "Their exit removed up to 1 in 3 bids at auction."

Mikael Brakker, L'Oréal Luxe E-Commerce Director for Europe Zone, first documented the complete elimination through LinkedIn analytics on July 25. "Amazon erased itself from Google Shopping in 48 hours - cause the richest click is the one you don't buy," Brakker observed, confirming the dramatic impact across European markets.

Mike Ryan, Head of Ecommerce Insights at Smarter Ecommerce, verified the withdrawal through multiple data sources before publishing confirmation on social media platform X. "Rumor has it that Amazon has turned off Google Shopping ads. I will be able to confirm & analyze this in detail via Auction Insights in a couple of days," Ryan posted on July 24, before confirming complete removal across all monitored markets the following day.

The strategic implications extend beyond immediate cost reductions. Amazon's complete withdrawal signals confidence in alternative traffic sources, including direct search behavior and expanding AI-powered recommendation systems. The company appears willing to sacrifice Google-driven traffic in favor of maintaining higher profit margins and customer relationship control.

This marks Amazon's most significant advertising strategy shift since a similar blackout during 2020 lockdowns. Market observers noted Amazon had already reduced its Google Shopping spend by 50% in the United States during May 2025, suggesting the July withdrawal followed months of strategic planning rather than an impulsive decision.

Digital marketing analyst David Kyle reported complications beyond paid advertising removal. "Have they completely disconnected Merchant Center altogether? I can't get them to show up for anything in Free Listings. This is drilling down on Amazon products like Fire and Kindle. I click more stores until all it does is show me ebay listings," Kyle documented through social media.

The timing coincides with significant developments in digital advertising. Google recently updated its auction mechanics, eliminating Performance Max campaign priority over Standard Shopping campaigns in October 2024. These changes altered how different campaign types compete for the same search queries during peak shopping seasons, as reported by PPC Land.

Industry experts propose five theories for Amazon's strategic withdrawal. First, the move serves as an incrementality stress test, similar to Amazon's 2020 experiment to determine which traffic requires paid search investment. Second, it represents a post-Prime Day detox strategy, eliminating external advertising spend while maintaining pristine return on advertising spend metrics during back-to-school demand periods.

Third, the withdrawal constitutes a margin optimization play. By eliminating payments to Google, Amazon keeps customer acquisition costs internal while directing shoppers to its own platform. Fourth, the move demonstrates negotiation leverage, potentially pressuring Google to reduce advertising fees through the withdrawal of substantial advertising spend estimated at hundreds of millions of euros.

Fifth, the removal reflects Amazon's broader strategy in search competition. With Rufus AI assistant and generative search answers expanding globally, Amazon seeks full-funnel customer control before Google's Performance Max campaigns further penetrate e-commerce territory.

The withdrawal affects global markets uniformly. Dario Zannoni from Ayudante confirmed Amazon stopped Shopping ads in Japan, while other analysts verified similar patterns across European markets. This comprehensive approach suggests a coordinated strategic decision rather than market-specific testing.

Amazon's decision reverses years of increasing investment in Google's advertising ecosystem. The company previously expanded its advertising presence through Google Lens Shopping ads integration, which reached nearly 20 billion monthly visual searches with 20% being shopping-related by October 2024.

The withdrawal creates uncertainty for advertising auction dynamics during the crucial holiday shopping preparation period. According to PPC Land's holiday advertising reporting, 71% of consumers plan to start holiday shopping before Thanksgiving in 2025, representing an 18% year-over-year increase requiring earlier campaign optimization.

Cost-per-click reductions following Amazon's withdrawal remain limited according to early market observations. Mike Ryan noted through multiple industry sources that significant cost decreases haven't materialized uniformly, though longer-term effects require additional monitoring as auction dynamics stabilize.

The advertising industry watches closely as two technology giants reshape their relationship with implications extending throughout digital commerce. Amazon's withdrawal demonstrates how major retailers increasingly view advertising platforms as strategic assets rather than necessary expenses.

Future developments depend on several factors including Google's fee structure responses, Amazon's traffic performance without paid search, and competitive retailer reactions to reduced auction competition. Whether the withdrawal proves temporary or permanent will determine long-term implications for both Google's advertising revenue and Amazon's customer acquisition strategies.

For marketing professionals, the development creates immediate opportunities. Manual Arrufat recommends specific tactical responses through his strategy framework. First, validate Amazon's absence in specific niches through auction insights or competitor analysis tools. If Amazon's overlap rate falls below 2% for seven consecutive days, treat the situation as an opportunity window.

Second, uncap campaign budgets strategically. Google warns against budget-constrained campaigns, recommending advertisers lift daily caps to 120-150% of current average spend while monitoring cost per conversion every 12 hours. Scale budgets only if return on advertising spend holds steady.

Third, implement aggressive target return on advertising spend adjustments. With auction pressure reduced, raise target ROAS by 10-15% or lower target cost per acquisition. Monitor search lost impression share due to rank - if it remains below 5%, push ROAS targets higher.

Fourth, optimize feed quality for maximum market position. Google emphasizes the importance of optimizing Merchant Center feeds to maximize presence. Upgrade GTIN completeness, implement high-resolution images, and establish dynamic price synchronization capabilities.

Fifth, establish defensive keyword and brand protection strategies. Remove broad negative keywords added solely to avoid Amazon's bidding competition. Deploy brand exclusions in Performance Max campaigns to prevent cannibalizing Search campaigns. Map high-margin SKUs to dedicated Asset Groups for isolated data analysis.

Finally, monitor re-entry signals carefully. Set automated alerts for Amazon overlap rates exceeding 10%, triggering email or SMS notifications. If Amazon reappears in auctions, immediately revert targets, tighten budgets, and shift focus to high-margin product lines.

The industry context reinforces the significance of this development. Google's Performance Max platform concluded 2025 with over one million active advertisers, representing substantial growth from its 2022 launch. The competitive landscape intensified during 2025, with Microsoft Ads launching Performance Max updates including LinkedIn integration for professional targeting data.

Timeline

• May 2025: Amazon reduces Google Shopping ad spend by 50% in the United States, signaling strategic shift
• July 21-23, 2025: Amazon completely removes all Google Shopping ads globally across US, UK, Germany, Japan, and other markets
• July 24, 2025: Mike Ryan reports initial observations of Amazon's potential withdrawal from Google Shopping
• July 25, 2025: Mikael Brakker documents complete Amazon withdrawal with impression share data 
• July 25, 2025: Mike Ryan confirms Amazon withdrawal across all monitored markets
• October 2024: Google eliminated Performance Max priority over Standard Shopping campaigns, changing auction dynamics
• October 2024: Google Lens introduced Shopping ads with 20 billion monthly visual searches
• November 2024: Perplexity launched AI-powered shopping assistant competing with traditional search
• 2020: Amazon previously conducted similar Google Shopping withdrawal during pandemic lockdowns

PPC Land explains

Google Shopping

Google Shopping represents Google's product advertising platform where retailers display product listings with images, prices, and store information directly in search results. The platform operates through Merchant Center integration, allowing businesses to upload product feeds that automatically generate Shopping ads. These advertisements appear prominently in search results and across Google's network, driving traffic to retailer websites. Amazon's withdrawal from this platform eliminates one of the largest e-commerce players from Google's product advertising ecosystem.

Impression Share

Impression share measures the percentage of times an advertiser's ads appear compared to the total number of times they were eligible to show. Amazon's impression share dropped from 38-60% to 0% across major markets, indicating complete advertising withdrawal. This metric helps advertisers understand their market presence and competitive positioning within Google's auction system. The dramatic reduction in Amazon's impression share creates opportunities for other retailers to capture additional visibility.

Performance Max

Performance Max campaigns represent Google's automated advertising solution that uses machine learning to optimize across all Google properties including Search, Display, YouTube, and Shopping. These campaigns automatically adjust bids, audiences, and creative assets to maximize conversions based on advertiser goals. Recent changes eliminated Performance Max priority over Standard Shopping campaigns, altering how different campaign types compete in auctions. This campaign type becomes increasingly relevant as advertisers adapt to Amazon's absence from Google Shopping.

Cost-per-Click (CPC)

Cost-per-click represents the amount advertisers pay each time someone clicks their advertisement. Market analysts anticipated CPC reductions following Amazon's withdrawal due to decreased competition in Google's auction system. However, early observations suggest limited immediate cost decreases, indicating other large retailers quickly absorbed available impression inventory. CPC dynamics remain crucial for understanding advertising efficiency and budget allocation strategies.

Merchant Center

Google Merchant Center serves as the platform where retailers upload and manage product information for Shopping ads and free listings. Amazon's complete withdrawal suggests disconnection from Merchant Center, affecting both paid advertisements and free product listings. This platform integration determines product visibility across Google's shopping experiences, making Merchant Center access essential for e-commerce success. Other retailers may need enhanced Merchant Center optimization to capture Amazon's vacated market share.

Auction Insights

Auction Insights provides advertisers with competitive intelligence about other companies bidding on similar keywords and product categories. Industry analysts like Mike Ryan use Auction Insights data to track competitor presence and market changes. This tool revealed Amazon's complete withdrawal from Google Shopping auctions, confirming the strategic shift. Auction Insights becomes particularly valuable for understanding market dynamics following major competitor exits.

Incrementality Testing

Incrementality testing measures the true impact of advertising spend by comparing performance with and without specific campaigns or channels. Amazon's withdrawal may represent a large-scale incrementality test to determine Google Shopping's actual contribution to sales versus organic traffic. This testing approach helps companies understand which advertising investments drive genuine additional revenue rather than capturing existing demand. The 2020 Amazon blackout provided similar incrementality insights during pandemic conditions.

AI-Powered Search

Artificial intelligence increasingly influences search experiences through tools like Google's AI Overviews, Amazon's Rufus assistant, and emerging platforms like Perplexity's shopping features. Amazon's withdrawal coincides with expanding AI search capabilities that potentially reduce dependence on traditional paid advertising. These technologies change how consumers discover products and make purchasing decisions. AI-powered search represents a fundamental shift in customer acquisition strategies.

Return on Advertising Spend (ROAS)

Return on Advertising Spend measures advertising effectiveness by calculating revenue generated per dollar spent on advertising. Amazon's withdrawal suggests confidence in maintaining ROAS through alternative channels while eliminating Google Shopping costs. High ROAS requirements may have influenced Amazon's decision to eliminate external advertising spend in favor of internal customer acquisition. This metric remains crucial for evaluating advertising efficiency across different platforms.

Click-Through Rate (CTR)

Click-through rate measures the percentage of people who click an advertisement after seeing it, indicating ad relevance and appeal. Analysts anticipate higher CTRs for remaining advertisers as Amazon's absence reduces competition for consumer attention. Improved CTRs can enhance ad quality scores and reduce costs within Google's auction system. This metric helps advertisers understand engagement levels and optimize creative assets for better performance.

Summary

Who: Amazon, the global e-commerce giant, completely withdrew from Google Shopping advertising, affecting Google's advertising revenue and competitor strategies.

What: Amazon eliminated its entire Google Shopping ad presence globally, reducing impression share from 38-60% to 0% across major markets including the US, UK, Germany, and Japan between July 21-23, 2025.

When: The withdrawal occurred over 48 hours between July 21 and July 23, 2025, following a 50% reduction in US advertising spend during May 2025.

Where: The removal affected all global markets where Amazon advertised on Google Shopping, including the United States, United Kingdom, Germany, and Japan, with industry analysts confirming uniform implementation worldwide.

Why: Amazon's strategic withdrawal likely serves multiple purposes: conducting incrementality testing to determine paid search necessity, optimizing profit margins by eliminating external advertising costs, demonstrating negotiation leverage with Google, and asserting greater control over customer acquisition channels as AI-powered search alternatives emerge.