Google thinks that making money on suggesting purchase is better than playing/showing ads.
Free apps and services have been a major factor for driving the install numbers on the PlayStore. In order to generate revenue from these apps and services, developers started adopting two major ways – either make the app a freemium service or put ads in it. While the former idea still seems focussed towards practicality, the latter idea is not a very popular one with the users. Ads are always annoying in apps and take away from its experience. However, Google thinks there’s a better way to do that for its free-to-use Google Assistant.
Instead of putting annoying ads into it and letting users discard the app later, Google has decided to make money from the Assistant by earning revenue through online sales done with assistance from the Assistant. Whenever a user makes a successful purchase from the Assistant’s results, Google will get a cut from the price of the product for its marketing efforts.
However, Google will still display product options on its search page without any charges, i.e. marketers will not be charged any amount for their products shown in the window. Assistant will automatically pull up search results from the Google search.
Google Senior Vice President of Advertising and Commerce Sridhar Ramaswamy expanded on the Assistant revenue model at the Google Marketing Next conference, citing that revenue from Assistant would come mainly from suggesting specific sales partners rather than inserting ads.