Surprise, ambivalence and disappointment are just some of the reactions to news of the closure of Google’s Affiliate Network (GAN), but does this affect the performance marketing industry as a whole?
Following the US-founded company’s revelations that in the next few months it will kill-off GAN, which was set up to help advertisers and publishers boost their performance across the affiliate environment, A4u spoke to industry players to get their thoughts on the matter.
Commercial director at the Performance Horizon Group, Matt Bailey, said he was very surprised to hear the news as Google had invested ‘a lot of time and money’ in building up its affiliate network in multiple territories.
“It must have been a hard decision to turn their back on it having put so much into it and I feel bad for anyone who has been laid off because of this,” Bailey said.
“I don’t think it reflects on the industry as a whole. Without knowing the full story, I feel that this is probably a strategic decision from Google that an affiliate network does not fit with where they want their overall company direction to be. Google’s DNA is around releasing tech products that allow clients to serve themselves, and a service heavy affiliate network never really sat true within that.”
Bailey said if it was the case that Google had thrown a lot of money at it and it had not been successful, then it would mean it had done a poor job or the market was not big enough. However, he stressed this is not the case as GAN was very successful in the US and was gaining traction in other markets.
Scramble to Secure GAN Clients?
Managing director at Affiliate Window, Mark Walters, said he was ambivalent about the news.
“It’s never nice to see any proposition fail; behind the news there may be jobs and livelihoods at stake. However, performance marketing is a buoyant industry and there will always opportunities for experienced individuals. We lost little to GAN and don’t have many shared programmes so our focus is still on ‘always trying to be better’,” Walters said.
In terms of any repercussions across the performance marketing sector, Walters said reducing the number of competitors in any market is generally seen as a plus for the remaining players, but acknowledged that competition is also good thing.
“No one wants the market to stand still, so as long as competitors remain and the focus on improving what we have is still prevalent, then the outcome is still a positive one. It’s less about the inevitable scramble to secure GANs clients; for the few clients that chose GAN they did so for a reason and there are things to learn from this to ensure these elements are accommodated," Walters added.
Little Traction Gained in UK
Performance director at 7thingsmedia, David McDermott, said while the announcement of the demise of GAN came as an initial shock, in reality it is not a surprise to him. He said from a UK perspective, GAN has gained little traction since launching in the market 12 months ago. In the US however, based on the acquisition of Performics in 2007, he said the market share was much higher - and was reported to be the third biggest network.
“What isn’t surprising is that Google has decided to ‘drop’ this offering from its stable and focus on a different variation of the same CPA offering via Google Shopping. This is a tried and tested Google strategy that comes with no airs or graces if a product is not working in their eyes, McDermott said.
“The disappointment of this news comes with the potential promise that GAN brought to the performance industry: technology that could integrate the best of Google products within a CPA environment. Given that the majority of the UK networks are still dated stand-alone closed source platforms; this represented an exciting proposition and change.
“However, as any marketer will know, having all your eggs in one basket is not always a good idea.”
President and chief executive officer at Tradedoubler, Rob Wilson, said the initial impact of Google’s withdrawal from the affiliate network arena will be felt by affiliates, who will now have to swap links and build relationships all over again. While he also believes there is bound to be some initial damage to the sector’s credibility within the wider marketing world, he is a firm believer that the industry in general will continue to flourish.
“Obviously this is not good news for the industry, if the implication is that a new network, even of Google’ssize can’t make performance marketing work, when this is blatantly not the case. The issue with Google Affiliate Network is that it relied heavily on a self-service platform and as most networks know, it is about more than just about automation,” Wilson begins.
“More worryingly, Google leaving the market could impact the wider credibility of performance marketing and this could be an issue that we need to address as an industry. Finally, I believe GAN was also cannibalising its CPC business the way it was managed.”
Wilson stresses that less network competition overall is positive for Tradedoubler, but said that although in the UK, Google was a burgeoning network, in other Tradedoubler markets Google had not made significant inroads – meaning the overall impact on the business will not be big.
“For other networks, especially with a US presence, this will be very good news," Wilson added.
Networks to Step-up?
London and Glasgow-based digital agency, Alienation Digital, said it was also ‘surprised and disappointed’ to hear the news from GAN.
A spokesman said: “It will be interesting to see which networks Google’s clients turn to in light of this news, and if any of the networks will step up to add value where GAN failed.”
A4u understands that tracking links on Google Affiliate Network will cease operating on July 31. However, data and reporting will be available until October 31.