Through the analysis of some recent competition authority investigations as well as conduct adopted by Google on the online advertising platform Google Ads, the chapter provides insights on some commercial practices opted for by the giants of web marketing with the purpose to deepen the future legal and market challenges. In conclusion, this study aims to contribute to the current debate and the attempt to find remedies that offer appropriate protection to advertisers and consumers as well as granting support to the lawmakers, who in turn have a duty to carefully regulate the search giant.
TopIntroduction
The advancement of the state of the art, the continuous evolution of the Net and the rapid development of web marketing require contemporary scholars to reflect deeply on the characteristics of business around the web (Gustin, 2019)1. It is well known that web marketing is based on increasingly sophisticated algorithms and functionally has strong repercussions also on the market and on competition between companies. This situation has been emphasized primarily in this particular time linked to the global health crisis triggered by the Covid-19 pandemic, in which the web is playing a central role in the purchase by web of products and services (Hughes, B. C., 2020, p. 400).
Practically, Google, Facebook, Instagram very often in addition to having the function of a mere search engine or, as in the case of the latter, of social network, have - as will become clear later - also the potential to generate real business models (Telman, 2015, p. 728)2.
In fact, the competitive advantage over other media is their ability to generate advertisements, the so-called “sponsored links”, which are closely linked to the organic results of searches and algorithms, therefore, helping businessess to find customers. In this context, there is no shortage of those who advocate the controversial principle of the neutrality of internet research, even going so far as to qualify it as a “public good”3.
Having acknowledged this, today a tool through which it is possible to generate real business models is Google AdWords - now called “Google Ads” - which is a powerful service that has strong repercussions not only on the market but also on competition between business (Tan, 2010, p. 474). In practice, Google Adwords is a performance marketing program, that is a tool through which the advertiser, or the one who promotes his company, pays a service to have precise results that are traceable and measurable. AdWords is an auction-based system for search results advertising that allows advertisers to bid on keywords. In short, it is an online advertising positioning service and represents the main source of profit for the Google group: already in 2013, thanks to this service, it had revenues of over 50 billion dollars.
Unlike advertising on mass media or social networks, with Google Ads the advertiser does not pay for the simple display of the advertisement by the user, but it will pay for the service only if the user takes an action that is to “click” on the advertisement to learn more about the advertised product or service. This system is based on pay per click (ppc) or on that formula that requires a disbursement from the advertiser, only if a user actually clicks on the ad. This system represents the core product being sold (Newman, 2014, 412).
It is clear that the advantages connected to this tool are many and quite seductive for companies that aspire to maximize profit and adequate visibility4 even beyond national borders and, conversely, to acquire a competitive advantage on the market (Tan, 2010, p. 5005; Visco Comandini, 2013, p. 5516).
It follows that, to date, for many entrepreneurs it is no longer possible to conduct business without online advertising because of “web window” which is increasingly assuming an important role in determining the advertiser's market strength not only because it allows them to acquire new customers but also in order to consolidate its commercial reputation (Montanari, 2012, p. 147).
From this perspective, Google, not only for its competence and foresight but also because it represents the most visited site in the world, has monopolized Search Engine Marketing (hereinafter referred to as SEM), i.e. those platforms that represent an essential, if not indispensable, tool for companies that want to operate - especially after the current global pandemic crisis - in the new era of globalization (Zuboff, 2019, p. 19. Rodigues, 2019, p. 37).