According to a federal class action lawsuit filed Tuesday April 22nd by Kabateck Brown Kellner, LLP in U.S. District Court, Google is deceiving its customers into paying for ads they do not want.
Brian Kabateck is the lead counsel on the case. He recently won a multi-million dollar settlement from Yahoo! and earlier a $90 million settlement from Google on behalf of advertisers victimized by click fraud.
According to a release from the firm, Kabateck stated:
“This debunks Google’s carefully cultivated image. Google is hurting its customers on two fronts. Google is not only taking money out of customers’ pockets, it’s derailing their advertising strategies as well.”
The suit is largely based on the fact that novice advertisers do not often turn off the “content network” on their AdWords campaigns by putting a “0″ in the box for the third party sites. This leaves a portion of their spend available to publishers on the AdSense program. Ads that run on third party, non-search sites, tend to be viewed as less effective in terms of CTR (click through rate) and ROI.
Kabateck views this practice as deceptive, and one that is draining Google advertisers of their online budgets.
“People go to Google hoping that some of its magic will rub off on them,” Kabateck added. “Instead, Google’s sleight of hand deception is making their money disappear.”
I have heard complaints such as these from several business owners that have had an experience such as that of the plaintiff, David Almeida, a Massachusetts-based private investigator who enrolled in Google AdWords in November 2006. The issue is often discovered by advertisers when they see reports of low CTR.
The idea that Google would knowingly deceive advertisers seems a bit far fetched to me, well not that they would deceive, but that they did deceive.
Although I agree that they may have missed the boat on a usability flaw, which is something all of us are guilty of from time to time, I do not see what the giant of the online space has to gain by intentionally leading advertisers to third party publishers. In fact, such ad delivery means that Google has to give up a share of the advertising revenue earned. The company would probably prefer the ads be served on their own search network, where they can take in 100% of the revenue.
Third party publishers using AdSense often offer low cost “clicks” for advertisers. If Google made the third party sites more difficult to opt in to would that foster accusations that the company was deceptively leading advertisers to higher cost ad deliver options?
If you are a marketer working with pay per click budgets for clients you may want to pay special attention to cases such as this. If the U.S. District Court finds Google liable of the deception Kabateck Brown Kellner accuses them of, then does the same apply to SEM companies that may have been negligent when creating customer accounts and left the “content network” on?
It is an interesting question at the least.
As search marketers we often covet titles such as Google Qualified and Yahoo! Ambassador, but we never question whether these brand associations could cost us in terms of litigation.
I would hope the lesson brought home by legal battles such as the Almeida case, are that although available to the masses, well constructed search marketing campaigns are something best left to those with a working knowledge of the process. Although tools and information exist on the web to educate an individual a thousand times over, advertisers should remember that AdWords and other PPC solutions are every bit a complex concept as traditional marketing outlets, and thus for the best results they should most likely get professionals involved.