Google and the European Union (EU) have had a contentious relationship for many years. Trouble for Google with the EU started as far back as 2010, but the first of three antitrust investigations against the company has finally come to a head. In June 2017, the EU has officially hit Google with a record $2.7 billion fine for abusing its search engine market domination.
The EU has determined that Google favored its own shopping service over other competitor sites. Thirty companies had filed complaints against the giant of which 19 were included in the case. With this ruling, many other competitors may now file their own complaints against the company. Google has 90 days to appeal the ruling, and it appears that it will. In the meantime, however, what does this mean for Google Shopping, especially for advertisers and marketers?
What the Ruling Means
The most obvious outcome of this is that third-party competitors may now have more precedence in Google Shopping searches as well as in other sectors like travel and maps. Consumers may begin to see more choices outside of Google’s own search platform. This may lead to better competition, which often means lower prices and more choices for consumers. If the ruling holds, consumers will also see more of competitors’ products and potentially less of Google’s own paid search and display advertising. For advertisers, this means that your products will have a better chance of being seen by consumers.
Yet, this might also mean that consumers will have to work harder to find what they are looking for. One of Google’s defenses was that the banner advertising within the product searches helped consumers make purchases faster.
In short, this ruling doesn’t mean the end of Google Shopping. It will continue to exist as an option for Europeans – for now. But that may not be the case forever.
The Greater Threat
Google is known for pulling their services when times get too tough. Back in 2014, Google shut down its Google News service in Spain. A new law was going into effect that would have required the company to pay news organizations if they linked to the Google News service. A month before the law would have gone into effect, Google said that it would stop linking Spanish publisher content.
Google is currently working with a law firm to appeal the latest ruling. If that appeal fails, then the Internet giant might just decide to shut down its Shopping service in Europe, meaning that advertisers would have a tougher time showcasing their products.
What Should Advertisers Do
For the time being, there’s not much to do. The EU and Google will continue to fight this out – potentially for years. It’s been nearly six and half years since the investigation began, and we’re only now getting a ruling on the first case. Yet, it will be worth observing how the EU deals with Google in future cases. This could be just the beginning of major rulings against the search engine. Time will tell whether Google takes this as a sign to permanently pull many of its service offerings from all of Europe.
A final thought:
- Don’t give up yet on other shopping platforms, such as Ebay or Pricetag. To this point, they have seen their site traffic crater of the years, with most retailer marketers eliminating them from their media plans. As such, your skills might have got a bit rusty on how to effectively use them – in addition to being probably a bit lazy as you consolidated your media plan into less line items. So, we recommend that you try out some of them again to get your mindset into the right direction and brush up on all of their functionality.