Google Buys Millions of Its Own Ads
It turns out that Alphabet Inc, one of the largest
advertising businesses, sells itself the most ads. While many of us are aware that there is some
bias in the reported results that occur, it is surprising to me that Google
products and its subsidiaries products appeared in the top spot for 91% of
25,000 recent searches related to the items.
In 43% of these searches, the top 2 ads were for google-related products.
As a shareholder, personally, I like it. As a consumer, however, it just means that
one needs to be aware of what they are seeing when they search for a
product. The highest item on your search
list isn’t necessarily the most popular or the one that fits the best, but
rather, a product that google wants you to purchase. Per Google, when it competes for the ad space against other
advertisers, it claims that other advertisers are charged as if it wasn’t
bidding – meaning that prices shouldn’t be inflated.
The implications:
Google holding top ad slots for search ultimately increases competitors
bidding for the remaining slots for views.
This also means more in-house products that Google is able to showcase
and sell, but at the cost of displaced ad revenue from other companies.
These will be interesting metrics to track over time. Per Google, it says that its house ads appear
on a much smaller portion of searches than in 2010.
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