What if one of the biggest tech giants in the world was dismantled? With the DOJ’s antitrust decision on Google just days away, are we on the brink of a seismic shift in how we access information and advertise online?
Today, we’re exploring the potential breakup of Google and its implications for consumers, advertisers, and publishers with Steven Read, Chief Product Officer at adMarketplace. We’ll discuss what this historic antitrust case could mean for innovation and competition in the search advertising space.
About Steven Read
Steven Read is the Chief Product Officer at adMarketplace, the open web search advertising company. He previously worked at Rokt, where he was responsible for product management, business analytics, and product marketing. He’s also consulted for firms such as Accenture and Boston Consulting Group.
Resources
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Transcript
Greg Kihlstrom:
Welcome to Season 6 of The Agile Brand, where we discuss marketing technology and customer experience trends, insights, and ideas with enterprise and technology platform leaders. We focus on the people, processes, data, and platforms that make brands successful, scalable, customer-focused, and sustainable. This is what makes an Agile brand. I’m your host, Greg Kihlstrom, advising Fortune 1000 brands on Martech, Marketing Operations, and CX, bestselling author and speaker. The Agile Brand Podcast is brought to you by TEKsystems, an industry leader in full stack technology services, talent services, and real world application. For more information, go to teksystems.com. Now let’s get on to the show. What if one of the biggest tech giants in the world was dismantled? With the DOJ’s antitrust decision on Google just days away, are we on the brink of a seismic shift in how we access information and advertise online? Today, we’re exploring the potential breakup or other potential options of Google and its implications for consumers, advertisers, and publishers with Steven Read, Chief Product Officer at AdMarketplace. We’re going to discuss what this historic antitrust case could mean for innovation and competition in the search and advertising space. Welcome to the show, Stephen.
Steven Read: Thanks, Greg, and great to be here.
Greg Kihlstrom: Yeah, looking forward to talking about this with you. Certainly, lots of potential implications here, so definitely want to get your take. But before we dive in there, why don’t you start by telling us a little bit about your background and your current role?
Steven Read: Yeah, sure. So as you mentioned, Greg, I’m currently chief product officer here at our marketplace. And to give you a bit of context about the business, we’re a search ad tech business. So when you’re searching on your favorite shopping app like Klarna, Afterpay, or on a major browser like Opera or Firefox, then our technology platform is delivering relevant results to consumers as they’re searching in those respective apps and browsers. And we’re delivering those results from major advertising brands that we work with around the globe. In terms of my background, I studied computer science at school and thought I’d be a software engineer. But in my early 20s, I didn’t want to commit myself to a career choice too early. So I ended up going into consulting, first of all, with Accenture and then Boston Consulting Group. And then since leaving consulting, I’ve done a series of product leadership roles at technology businesses, starting in a telecommunications business a while back, and then joined a marketing technology company called Rockt. And then just over three years ago, I landed here at our marketplace. And it’s been a great ride over those three years so far.
Greg Kihlstrom: Great, great. Yeah, well, looking forward to diving in here. So let’s get started and talk about the, again, decision in a matter of days. here in the DOJ’s case against Google. And, you know, it’s been called perhaps the most significant antitrust effort since the breakup of AT&T. So for those that may not have been following along, can you walk us through, you know, what’s the core of the DOJ’s argument and why they believe Google has maintained potentially an illegal monopoly in search and advertising?
Steven Read: Yeah, for sure. I mean, it really is a very significant case. I mean, we’ve actually changed our onboarding and training program to include, as part of the mandatory training, a reading of some of the briefing documents from the case. We see it as so pivotal to the search industry. But in short, the U.S. Department of Justice, along with a group of state attorneys general, sued Google in 2020 for allegedly illegally monopolizing the internet search engine and internet search advertising markets. The core of their argument is that Google has established distribution agreements that are exclusive and have anti-competitive effects. And what that really means in practice is that Google required Apple, Firefox, and others to ensure that Google was the default place to go when you start searching in those apps or devices or browsers. And many people don’t change that default. The way that Google established these agreements is they paid tens of billions of dollars each year to ensure it was the default search engine on those apps and browsers. In 2021 alone, Google spent a total of 26.3 billion US dollars on these deals to ensure that that status of the default search engine was in place. And those agreements have helped Google create a really huge scale advantage in the market. So just to give you some facts on that, they have nine times the search queries of all of their rivals combined have. And that advantage stretches on mobile devices to 19 to 1. And the court has now found in this first phase of the trial that Google is indeed a monopolist and has acted as one to maintain that monopoly.
Greg Kihlstrom: Yeah. Yeah. So, you know, from the consumer standpoint, that’s, you know, obviously if it’s the default, you know, people are not as likely to change it and therefore they’re, they’re using it. And then from the advertiser and marketer standpoint, it stands to follow that. And anyone that is using search marketing knows this already, but it’s made Google the dominant and the go-to platform for search advertising. So I know breaking up Google is not the only, there’s probably a few different scenarios here, potential scenarios here. But how would a breakup affect their ability to reach target audiences effectively?
Steven Read: Yeah, for sure. I think, Greg, at this point, it’s a little preempted to talk about a breakup. We’ll know more on the 20th of November when the DOJ submits their proposal for a final judgment to the court. But it’s reasonable to expect that the proposal is likely to include several approaches that range from prohibiting the types of agreements that Google is into or restricting them in some way on what types of agreements they may establish, all the way through to a possible breakup. The final decision for the judge isn’t expected until the summer of 2025, but the DOJ may, in addition, seek what’s called temporary injunctive relief to expedite the case beforehand. So we might see more changes or more movement much, much sooner than that. I mean, regardless of the outcome, I’d encourage advertisers to see this as an opportunity to really think about how you engage with consumers who are searching online. What came out from the trial and several of the key witnesses was clear evidence for what many of our advertisers have been saying for quite some time now, is that the cost of advertising on Google has increased. And the trial showed that Google has several pricing knobs and levers that it could use to control and increase pricing on advertisers. And at the same time, if you look at the data and the analytics around consumers and users of Google, they’ve reported worsening search results. I mean, I was on Reddit the other day and a thread came up about asking people about what’s degraded in quality over the last 10 years, and the highest voted answer was that Google search results was what had degraded the most. As a consequence, what we’re seeing more and more is that consumers’ online search journeys are fragmenting. No longer is the search engine and the search results place the place that everyone’s going to all the time for their search results. Consumers are increasingly starting their search journeys on shopping apps in their browser or an AI tool somewhere else. So for marketers, this is a great opportunity to really rethink and ensure you’re reaching consumers where they want to search, and also maybe get some better value for money from your marketing investments for your brand.
Greg Kihlstrom: Yeah, yeah. Well, and I would imagine, you know, part of the DOJ’s calculus here is to increase competition, right? I mean, that would be one of the primary goals of an antitrust effort, whether it’s, to your point, a limited limiting some of their activities all the way up through something much larger and more extensive. From an advertiser perspective, what are the opportunities or challenges as well that could arise if there’s some new competitors in the search advertising space that are more competitive than the current landscape allows?
Steven Read: Yeah, sure. I mean, in terms of opportunities, I touched on this briefly before, but I think this really is an opportunity where marketers can start to engage with consumers where they’re searching, where they’re more frequently searching, where they’re finding such expenses more engaging. And secondly, to improve the value for money from their marketing investments. In terms of challenges, I think there’s certainly a couple of significant challenges that marketers will need to address. So firstly, there’s an organizational challenges. I mean, from what I hear from our clients is that, you know, marketers have gotten pretty used to just having one major channel to deal with or a couple of major channels to deal with. And therefore, the teams are often structured accordingly. I often hear from advertisers about not having enough bandwidth to deal with additional places where consumers are searching, or even worse, that they’ve got multiple teams that are overlapping and working with the same channels. So the organization structures are going to really need a rethink as consumers start searching more and more in these different places. As consumers start using tools like AI, then our approaches and our organization structures will need to shift. Secondly, how advertisers think about performance measurement is going to require a bit of rethinking. What I often see is that brands take one approach to measurement that seems to work pretty well on Google and try and apply that across other search channels. When consumer search behavior is fragmenting, then the scale available on some of those alternative channels might be quite different, or the measurement approaches might also be quite different. And therefore, I think brands need to be more open to taking more diverse approaches to measurement that might well involve specific partnerships or more customized approaches to make sure you can get the right approach that gets you an accurate read and a real understanding of what’s driving return for your marketing investments.
Greg Kihlstrom: And so, you know, we talked about this from the the advertiser perspective. I want to talk about the publisher perspective of this as well, because, you know, many publishers rely heavily on Google’s ad platform for revenue. So, you know, what are the implications of, you know, again, anywhere from small changes to big changes? You know, what are the implications there in terms of their monetization and their traffic?
Steven Read: So from the data I see across the market and from client feedback, we’re already seeing some significant shifts for publishers in terms of monetization and traffic from Google. It’s really difficult to predict and see how a breakup might play out in this regard, but particularly the trend of showing AI overviews that are generated using generative AI. that’s already led to some significant changes in monetization and traffic. Those are the bits of blurb that now increasingly show up at the top of the search results that compiles information, the results from a typical search query, into a digestible block of text. And those types of information summary are likely to continue whether the breakup is indeed a remedy or other remedies are in place. And that will have a material and significant impact for monetization of publishers.
Greg Kihlstrom: Yeah. And so, you know, you touched a little bit on the potential impact of this case on innovation. I mean, you know, even mentioning, you know, that it’s kind of known that search, or at least felt that search results and search quality seems to have degraded. So, you know, is this an opportunity for improving search technology, search experiences? You know, is there some strong potential here for innovation?
Steven Read: I see this as the most exciting part of this entire situation. I believe we’re at an inflection point for online search that’s going to deliver a much better experience for consumers and users of search online. If you take a big enough step back, searching online is actually pretty weird. You type in a bunch of odd words that aren’t really a sentence into this blank box on your device. And a system takes its best guess at what you actually mean in a few fractions of a second and shows you a long list of results on a separate page or a bunch of pages. And if that search engine gets it wrong, you start that process all over again. You type in a different set of random words into that box and see what comes out. And for most search journeys, that’s actually pretty ineffective. And what we’ve started to work on, where I think online search will head, is a much more interactive and discursive approach. The use of generative AI and these types of new technology allow us to be far more interactive in search, to really understand far more granularly what someone’s intent actually is, what they really meant by their search term, and use natural language to help refine and clarify that understanding. And that therefore means that search functionality can help you understand that and define that intent more clearly, but also maybe even help you discover additional products or interests that you might not otherwise have considered. So in a few years’ time, I think we’ll look back on the current concept of a search engine results page that you navigate back and forth onto as a bit of a quaint part of history. It’s going to look quite different in the future.
Greg Kihlstrom: Yeah, yeah. I believe it. you know, certainly, I mean, Google is a very, very large company, we can all agree, but they’re not the only very large company as well, you know, let’s say, to some degree, things move forward with this with this decision, what are the implications for other large tech companies, maybe even the tech industry at large, but for those that might grow to become larger, you know, what’s what are the broader implications here that should kind of color how tech companies plan out the future.
Steven Read: Yeah, I mean, the ruling is significant. Google is named as a monopolist, is a significant shift for the industry and the broader tech industry at large. I think it sends a pretty clear message that whilst tech platforms can indeed be dominant, that dominance can’t be abused. And ultimately, if that dominance is abused, then it stifles innovation. And that’s really what we’ve seen in search. If you look back at the search results pages, even as far ago as 10 years, It’s not that different and really that staffing innovation has occurred as a consequence of monopoly activity. And so, I encourage any decision that the court has made that can drive competition because ultimately, competition fuels innovation.
Greg Kihlstrom: So given that we know there is going to be a decision at some point, we don’t know exactly what, but it seems at least a possibility that some changes may need to be made. What should a marketer or advertiser do right now? How should they be thinking about preparing for a potentially new landscape?
Steven Read: Yeah, for sure. I mean, I think it’s a really exciting time to be a search marketer. Search is, as we said in our recent Impact Conference, search is suddenly sexy again. And I think firstly for marketers, recognizing that the consumers are indeed shifting their behavior online, that more and more consumers are going to different places to conduct their online searches is a really important trend to get behind. I would encourage any marketer to rethink and think carefully about their strategy, particularly around how they test and learn with new channels. More and more we’re seeing newer places where consumers are searching online and having a means by which you can start investing marketing dollars to test some of those new channels is going to be critical. Thinking carefully about how you apply the right measurement approaches to understand what might be driving performance and making sure those measurement approaches are scalable so they’ll even work on smaller channels I think will be a really important part of understanding what works and what doesn’t for your brand. And then finally, having flexibility in terms of how that creative works, understanding what might drive engagement from a consumer, and being able to test and experiment with those different forms of newer forms of creative on new search channels online, I think will be really critical to success. So being adaptive, for me, means firstly, is being open to test and experiment with those newer channels, understanding that performance measurement requires some different or more agile approaches. to validate performance. And then thirdly, being open to trying new approaches to test different creatives, test different messages that might well engage with the consumer, I think will be critical steps to really drive greater performance in this new era of search.
Greg Kihlstrom: Great, great. Well, thanks so much for joining. One last question for you before we wrap up, something I like to ask everybody here. What do you do to stay agile in your role and how do you find a way to do it consistently?
Steven Read: Yeah, for sure. I mean, for me, staying agile means continuously learning and being open to grow and take feedback, being open to hearing alternative points of view, or even points that you might not necessarily want to hear. So what I’m constantly striving for is to gain that perspective, both internally with folks I work with here at our marketplace, and also outside from clients or from other individuals I’ve worked with in the past. Internally, for me, agility means building a team and fostering relationships amongst other leaders here at my company to really help me genuinely understand what’s going on, call me out on what’s not working, and finding those individuals who’ve got that really valuable input and fostering relationships so those individuals can genuinely tell you what they really think, which is so important to continuous learning. And externally, I’ve sought to build a network of clients, people I’ve worked with previously, that can provide that kind of sounding board input and feedback on what’s working, how I can think about things differently, what I might have missed as well, that really encourages that continuous learning and growth. So my rule of thumb is that if we as a team are doing something the same way as we’ve done it before, then it’s a red flag. It means that if you accept that it perfection’s impossible, then either you’ve got to be doing something different this time than you did last time. Either you haven’t learned enough from the previous attempt, or we need to be rethinking to make sure we’re always learning and doing better each time we do something. Yeah, I love that.
