Consumer Watchdog Tells FTC: Google Shopping Is Deceptive

Consumer Watchdog, a nonprofit public interest group, has officially complained to United States Federal Trade Commission (FTC) that the way Google displays results in its comparison shopping engine, Google Shopping, is unfair and deceptive to consumers.

“The way that the Internet giant is featuring results from Google Shopping without making it clear that the highlighted results are nothing more than advertisements for merchants who bid for placement is an unfair and deceptive act, violating Section 5 of the Federal Trade Commission Act,” wrote John M. Simpson, Consumer Watchdog’s Privacy Project Director, in a letter to the Commission. “Moreover, consumers are actually being harmed because the featured results from Google Shopping more often than not return higher prices than can be found elsewhere, when consumers would reasonably expect Google’s suggestions to be the best.”

According to Consumer Watchdog, when someone searches at Google, “Google responds with links to relevant websites, articles and clearly labeled ads. It also offers suggestions from its Google Shopping service, with photographs of specific camera models. Most people likely expect these to be Google’s suggestions for best prices, Consumer Watchdog said. However, if a person clicks on a pictured item, it takes them directly to the seller’s website, although there is nothing to indicate it’s an ad and that the seller pays Google and bids to be featured in Google Shopping.”

“Google’s presentation of the Google Shopping results disguises the fact that the results are in fact advertisements. Clicking on any one of the Google Shopping suggestions takes the user directly to the merchant’s page where the product can be purchased,” the letter of complaint said.

A Consumer Watchdog study found that more often than not, the item featured in the Google Shopping result is not the lowest price.

The Financial Times also analyzed the situation from another perspective and found five out of every six items highlighted on a Google search are more expensive than the same items from other merchants hidden deeper in the Google Shopping service, with an average premium of 34 percent.

Read the Financial Times analysis here: http://www.ft.com/cms/s/0/8c1f2e90-5501-11e3-86bc-00144feabdc0.html