Five years after the EU commission fined Google 2.4 billion euros ($ 2.65 billion) and ordered it to open its Google Shopping service in Europe for external competition, a new study shows that about 53% of ads on the platform in The United Kingdom still comes from Google itself – about 49% in 2019.
A study by Searchmetrics shows that after Brexit, Google is no longer trying to increase competition on its shopping platform in the UK.
In addition, the study suggests that most of the external participants in Google Shopping are not, in fact, providers of genuine shopping comparison services from which Google’s action is intended to benefit. There are many marketing agencies that have emerged since Google’s fine. They sell ads in the platform’s auction system, paying Google a margin and giving the impression of growing competition.
Google’s shopping platform displays product ads in search results related to the specific products people are searching for. In its 2017 antitrust action, the EU ruled that Google was giving itself an unfair advantage by promoting its own ads on the platform over those of competing shopping comparison websites that help consumers compare different products and prices to get informed. purchase decisions.
The latest Searchmetrics survey examined more than one million Google Shopping ad units in the UK and Germany to analyze the extent to which Google is complying with the EU’s call for more competition on the platform.
Comparing the results with previous research, Searchmetrics concludes that Google initially tried to increase external involvement in the UK to some extent. But after Brexit, his efforts seem to be waning.
Lillian Haase, CMO of Searchmetrics, explained: “Our data show that Google’s share of shopping ads in the UK was around 68% in 2018. And in line with the EU’s call for increased competition, this has been reduced to 51 % by 2019. However, as Brexit has taken place, Google’s share of advertising in the UK has started to rise again, reaching 53% so far in 2022. The trend clearly shows that after Brexit, the European Commission’s call for more competition no longer applies to search results in the United Kingdom.
In fact, there are signs that there is even less real competition in Google Shopping. According to data from 47% of UK Shopping ads that are not placed directly through Google, only 19% actually come from competing price comparison websites that were provided by beneficiaries of EU action. The rest (28%) are mainly from performance marketing agencies that sell ads in the auction system on the shopping platform, which gives Google a margin.
Google’s decision to address the lack of competition is to open a competition for Comparison Shopping Services (CSS), which can participate in the online auction by bidding against Google for advertising positions in the shopping platform. These external vendors may accept ad offers from online merchants who wish to appear on Google Shopping.
But according to Searchmetrics, while some CSS providers are real comparison websites, most are performance marketing agencies that offer comparative shopping services by name alone. Many of them were created after Google’s fine in 2017. And although they may manage comparative shopping portals, they only list products sold by merchants whose offers they manage in the Google Shopping auction system – which means that otherwise case they are largely irrelevant to real shopping for comparison. In fact, their only function is for Google to demonstrate that Shopping ads are displayed by publishers other than Google.
“Even if at face value Google seems to have opened Google Shopping ads to external vendors, these comparison portals themselves offer little user value,” Haase said.
According to a searchmetrics analysis, the UK’s top 20 CSS partners have negligibly low organic search traffic, supporting the view that their main function is actually to sell Google Shopping ads, not to help consumers find products.
The study shows that in Germany, 33.6% of Google Shopping ads still come from Google, a drop of about 50% in 2019 (and 67% in 2018). So in Germany, Google seems to be working to reduce its own involvement. However, there are the same problems as in the United Kingdom. Outdoor ads come from CSS partners, with 41.5% placed through agencies and only 24.9% from real price comparison websites that also function as CSS partners.
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