In the UK, 53% of Google Shopping ads still come from Google

Five years after the European 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 survey suggests that around 53% of ads on UK platforms still originate from Google itself – 2019 Increased from about 49% in the year.

Searchmetrics research indicates that after Brexit, Google is no longer trying to increase competition in its shopping platforms in the UK.

After all, the research suggests that the majority of external participants in Google Shopping are not actually actual comparison-shopping service providers intended to benefit from Google’s move. Many marketing companies have emerged after the fine of Google. They sell ads on the platform’s auction system, giving Google a margin and increasing competition.

Google’s shopping platform displays product ads in search results related to specific products that people are searching for. In its 2017 antitrust action, the EU has ruled that Google is giving itself an unfair advantage by promoting its own ads on platforms from competing shopping websites that allow consumers to compare different products and prices when making conscious purchasing decisions.

A recent study by SearchMetrics reviewed more than one million Google Shopping ad units across the UK and Germany to analyze how well it is complying with the EU’s call for greater competition on the Google platform.

Comparing the results with previous research, SearchMetrics concludes that Google initially sought to increase foreign participation in the UK to some extent. But since Brexit, its efforts seem to have waned.

Lillian Hass, CMO of SearchMetrics, explains: “Our data shows that Google accounted for around 68% of UK shopping ads in 2018. And in line with the EU’s call for increased competition, it was reduced to 51% by 2019. However, since Brexit happened, Google’s advertising share in the UK has started to rise again, reaching 53% so far in 2022. The trend clearly shows that after Brexit, the EU Commission’s demand for more competition no longer applies to UK search results.

In fact, there are signs that there is less real competition in Google Shopping. According to the data, 47% of shopping ads in the UK that are not placed directly through Google, only 19% actually come from competing price comparison websites who were the objective beneficiaries of the EU’s move. The rest (28%) are mainly from performance marketing agencies that sell ads in a shopping platform auction system that gives Google a margin.

Google’s solution to the lack of competition is open participation for comparative shopping services (CSS) who can participate in online auctions by bidding against Google for ad position on shopping platforms. These external providers may accept bids for advertisements from online merchants who wish to appear in Google Shopping.

But according to SearchMetrics, although some CSS providers are actual comparative websites, most are performance marketing agencies who offer comparative shopping services in name only. Many were formed in 2017 after Google was fined And while they can run comparative shopping portals, they only list products sold by merchants whose bids they manage on the Google Shopping Auction System – which means they are largely irrelevant to actual comparable purchases. In fact, their only job is to show Google that shopping ads are displayed by themselves from other publishers

“Even if at face value Google appears to have opened Google Shopping ads to external suppliers, these comparison-shopping portals themselves offer negligible user value,” said Haase.

According to SearchMetrics analysis, the top 20 CSS partners in the UK have negligible organic search traffic, which supports the view that their primary job is not to actually sell ads on Google Shopping, and to help consumers find products.

The study suggests that 33.6% of Google shopping ads in Germany still come from Google, down from about 50% in 2019 (and 67% in 2018). So, in Germany, Google seems to be working to reduce its own participation However, the same problem exists as in the UK. External ads come from CSS partners, 41.5% of which are paid through agencies and only 24.9% of the actual value comes from comparative websites who also act as CSS partners.

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Tags: Google, Google Advertising

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