Google’s EU mega-fine: how a startup built on Google Shopping is taking the news

Northern Stars, Manchester

Martin BryantMartin Bryant, June 27, 2017

This article was originally posted on the Tech North website.

When news broke of Google’s €2.4 billion fine from the EU earlier today, our first thought was ‘what does this mean for Dream Agility?’ One of our 2016 Northern Stars winners, the startup’s technology helps retailers optimise their listings in shopping search engines. As you’d expect, Google Shopping is a hefty chunk of its business.

So, is Dream Agility in trouble? Platform dependency can be fatal to startups when the goalposts move. With the European Commission forcing Google to stop prioritising its own shopping listings, the goalposts here have slid right across the pitch.

A threat on the radar

Dream Agility CEO Elizabeth Clark tells us the company has had the ruling on its radar for some time. Indeed, the EU has been investigating Google’s treatment of rival ‘vertical’ search engines for nearly seven years. Clark also has predictions for how Google will react to it, and how it might affect her own business.

“We’ve been waiting for this, it’s been kicking around for years. You could potentially have the same clients showing multiple times in SERPS (search engine results pages), but paying more for Google than they would going via an aggregator/marketplace.”

“Now we’ll be able to pump our clients in via other channels too. We’re Bing, Amazon, eBay, Affiliate Window, etc approved in preparation for this. We’ve been speaking with the super aggregators for a while. Although with Amazon putting their commission rates up to 22 percent I think people will have to choose their channels wisely. And the problem of cannibalisation of sales across channels for the retailer will continue to be a problem, so it needs to be used strategically.”

“It’s great for us”

“It’s great for us but another nail in the coffin for traditional digital agencies.”

A gutsy stab from Clark there, although it’s worth pointing out that we don’t know exactly what Google will do to address the European Commission’s concerns. And given that Google may well appeal and drag this dispute out for a few more years, maybe nothing will change for a long time yet. That wouldn’t be a bad outcome for Dream Agility either.