Posted July 13, 2007 8:53 am by with 1 comment

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The Australian competition watchdog dropped a bomb this week on the online search marketing industry. The ACCC (Australian Competition & Consumer Commission) has filed an action against Google – a world first – alleging that Google have broken Trade Practice laws by using the names of certain businesses in unrelated sponsored advertisements – directing searchers who click on a particular business name to their competition.

The case specifically revolves around a local car dealer who was allegedly targeted by a large classified website the The Trading Post. The Trading Post site listed sponsored links directly naming a smaller local car dealer. …fairly straight forward.

However, the implied ‘stretch’ stems from the ACCC’s belief that Google are implicitly involved as it was their system which allowed this to happen. Specifically, the ACCC now claims that the way Google’s sponsored links are displayed, particularly for the top paid ads appearing in the left column of the SERPs (above the organic results), are “misleading and deceptive.”

What this will all come to is unclear at the moment, as the ACCC has not yet proposed a viable remedy to the situation – even The Australian newspaper has called the case ‘a big stretch’.

What is more certain is that if the ACCC succeed, it will have a ripple effect on other search engines and the entire industry globally.

So are Google’s SERP pages misleading, as the ACCC claims? (I can hear the lawyers licking their lips as we speak).

My own experience with ‘green’ clients is that some people do still get confused by Google’s placement of sponsored ads directly above the natural results. After explaining the usual “right hand column/left hand column differences” to a client, I am often asked to subsequently explain the top couple of sponsored listings… I’d be keen to hear if this experience is still shared by others..

  • during my experience I’ve found position 3 to be the most cost effective and most fruitful.