While you might think of Google as the trustiest internet search engine in the world, the tech company has seen its fair share of scandals. Most notably, many antitrust scandals have cast doubt on the tech company’s popular advertising services.
In 2017, a data report by the tech firm SEMrush revealed that Google had been using its own platform to promote its products. From thermostats to Google pixel smartphones, the report revealed that Google had been plugging several products sold via its parent company, Alphabet Inc, using their own Google ad space.
If you’re unfamiliar with the Google advertising model, it’s a PPC (pay-per-click) system that awards ad space via an automated auction. By advertising its own products on the Google platform, the tech company breached the EU’s guidelines on competitive advertising, and after an investigation conducted by the EU, was fined $2.8 billion for its malpractices.
So, what does this mean for the future of PPC advertising and online marketing? Let’s take a look.
How does Google advertising work?
Automated auction
It’s also important to note that Google Ads (previously Google Adwords) uses an automated auction – rather than a manual auction – to assign ad space. What this means is simple: whoever selects the top bid (provided that their product is considered ad-friendly) will bag the top spot for their chosen keyword. Typically, companies will have several keywords that they’re trying to target and monopolise on Google’s search engine.
For example, a tech company might want to target a highly competitive keyword such as “smartphone cheap.” For Google to suggest their product when users type this particular keyword into the search bar, the company would need to set an incredibly high maximum bid to outdo their competition.
As you can imagine, Google Ads is a highly competitive – and financially lucrative – platform for businesses.
What did the analysis find?
In the analysis conducted by SEMrush, Google were found to be promoting products under their own brand name (such as their Google Home Speakers) while also giving top ad space to Nest Labs, a tech company acquired by Google back in 2014.
For highly competitive hardware keywords such as “laptops”, again Google appeared to be manipulating their own algorithm to direct users to Google-owned sites and products. What was more damning was just how frequent these manipulations appeared to occur:
- In 43% of searches for hardware items, the top two ads were for Google products
- A Google product would appear in the number one advertising slot 91% of the time
While Google strongly denies any claims of ad manipulation, the company was nonetheless investigated by the EU for anticompetitive malpractice. In a statement, the EU claimed:
“Separately, the Commission has also informed Google in a Statement of Objections of its preliminary view that the company has abused its dominant position by artificially restricting the possibility of third party websites to display search advertisements from Google’s competitors.”
After a lengthy court process, Google was fined $2.8bn by the EU for violating the EU’s antitrust rules. According to the EU court proceedings, the company was found guilty of “relegating the results from competing comparison services” in order to direct users to Google products.
They were also fined for other various antitrust violations, including abusing the dominance of their Android services, as well as another $1.7billion for anti competitive behaviour in their AdSense programme. The cumulative fines on the company totalled $9.5 billion. While Google appealed this decision, their appeal was rejected.
Google Ads: the Trust Factor
While this news might strike a blow in trust between advertisers and the tech company, Google still remains the most popular advertising platform in the world, with 80% of businesses worldwide using Google to promote their products or services.
Not only is their advertising business highly lucrative for Google themselves (with billions of pounds generated every year) it’s also one of the most heavily-utilised platforms by companies trying to target their core demographics.
This is because Google users really do click on Google ads more than other forms of advertising. What makes Google Ads different from other advertising platforms is that they are able to target users who are already on the lookout for a particular service or product. Google Ads generated over $140 billion in profit in 2020 alone, and users are four times more likely to click on an advert on Google than on any other platform.
It’s for this reason that the company’s anti competitive behaviours were so damning: 91% of Google’s revenue comes from advertising, with the tech company making over $100million (or around £84m) per day.
Google Ads vs. SEO
With Google doing all it can to monopolise its own services and products on their platform, it’s not surprising that many are turning away from the PPC model. When it comes to marketing a business online, it’s difficult to compete with corporations who are willing to spend tens of thousands – or hundreds of thousands – on advertising per year.
While PPC advertising can generate quick results, high competition for keywords makes it difficult – and expensive – to get a high ROI. Plus, as soon as you stop paying, Google pulls your ads. When it comes to creating a sustainable, long-term advertising model, PPC isn’t particularly lucrative for young businesses.
For this reason, many are now opting for organic growth strategies rather than the expensive PPC model. Organic growth – also known as SEO – can offer a much higher ROI and be as effective as a PPC campaign.
What is SEO?
SEO (search engine optimisation) is a marketing strategy designed to make your online content more appealing to Google’s algorithm. We all know already that only 1-2% of users click through to the second page of Google, so it’s important for your business to rank high if you want to avoid eye-watering advertising costs.
If you produce high-quality online content on your website (such as informative blogs, FAQs, and SEO-optimised product pages related to your business niche) Google will be more likely to rank your website high in organic search results. “Organic results” refer to the non-paid results that Google provides whenever you type in a specific keyword to their search engine.
Is SEO better than PPC?
PPC and SEO are both effective marketing strategies, but SEO has the edge when it comes to creating long-term sustainability. A high-ranking piece of online content is a bit like an eternal top slot in Google’s ad space – without the high costs.
The evidence also suggests that SEO is a more viable strategy when it comes to building consumer trust: in general, around 70-80% of users click through to organic search results and ignore paid and sponsored ads completely. The only downside to SEO is that it takes time; but with the help of an expert SEO consultancy in London, you can expect to see concrete results from a high-quality SEO campaign in anything from 3-12 months.
The Bottom Line?
While Google has been found guilty of manipulating ad results on its platform, it can’t manipulate organic search results. While SEO is a competitive and often complex strategy, it’s also the most cost-effective marketing tool for maintaining steady and organic growth – provided that you have experts on-board to help.
When it comes to comparing SEO vs PPC, it’s simple: either you want fast results (and you have hundreds of thousands of pounds to keep your campaign rolling month-to-month) or you want to create an affordable, long-term strategy that can help to grow your business organically.
And as the old adage goes, slow and steady wins the race.
