Google placed its own ads first, report says
Google main campus.Credit: Flickr/Niharb
Alphabet’s Google has been pushing advertisements for the company’s own products into prime online real estate, potentially in conflict with other advertisers, according to a new investigation by The Wall Street Journal.
In 25,000 searches related to items such as “speakers,” “watches,” and, “phones,” products sold by Google and its sister companies occupied approximately 91% of the top ad spot above search results, the study reportedly found. In 43% of the test searches, both of the top two ad spaces were occupied by Google-affiliated products.Report also noted that alarm products by another Alphabet firm, Nest, featured highly in searches for smoke detectors.
Products sold by Google’s parent firm Alphabet dominated the top of the results. Google said it had strict rules for buying its advertising space.
A spokesman said that the firm’s marketing policies were “consciously and carefully designed” so as not to intervene with ad pricing.
“All our bids are excluded from the auction when determining the price paid by other advertisers and we have strict rules and processes – set to tougher levels than our customers – to govern the use of our own ads products,” he said.
Google is the world’s largest sellers of ad space. It is also one of the world’s largest buyers. To market its array of hardware products—from Pixel phones to Nest smart thermostats to Chromebooks—Google effectively pays itself for advertising space.There is nothing unusual about media buying ad space on its own platforms. However, unlike most traditional advertising, where spaces command a fixed price, Google auctions the space and factors in the proposed ad’s relevance and quality, as calculated by an algorithm.
Google says that its own presence in the auction doesn’t affect a given space’s price, pointing to an internal rule that mandates the auctions continue as they would without the bid.
Soon after the WSJ shared its findings with Google on Dec. 15, the paper reports, many of the ads disappeared. A subsequent analysis carried out a week later showed Google or Nest ads taking the top spot in less than 20% of searches.