Amazon has launched a trial of a new program called Product Ads. The program allows retailers to purchase ad space on Amazon without selling their products on the site. When a user clicks on the ad rather than being taken to a product within Amazon, the customer will instead be sent to the companies 3rd party site to make a purchase.

Product Ads will show a 3rd party competitor, along with the price they're offering an item at right on the same page as the Amazon item. Reminiscent of PriceGrabber, different sites and their price for a particular item are listed below the item and description on Amazon. Users can see all the prices at the same time and make a decision whether to continue with their purchase on Amazon, or click over to the 3rd party website to make a purchase.

Much like other advertising programs advertisers only pay for their ad when a user clicks on an ad and is taken to the advertisers site. Both Google Product Search and Shopping.com run similar programs, but neither is the selling powerhouse that Amazon is. By combining advertising along with their extensive product catalog Amazon is setting themselves up to be even more of a leader in the online shopping arena.

The new program also forces Amazon to stay extremely competitive in its pricing in order to make users want to purchase items from them, however it also gives them the ability to make money off users who do choose to shop somewhere else. It will be interesting to see if the program survives. No doubt the program is great for shoppers, but how do you think Amazon will do with Product Ads? Do you think it will make it through the trial?

[via VentureBeat]