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Google's brand ads are a 'sham,' but companies have to buy them anyway, report finds

If you use Google—and chances are you do—then you're used to seeing ads when searching online. But how do those ads get on Google search and, more importantly, who is paying for them? It's easy to assume Nike pays for the Nike ads, but that's not always the case.

Welcome to the world of brand advertising on Google, where companies often have to compete to pay Google for their own search keywords—the term connected to a Google search for "Nike" or "Adidas," for example—or risk a competitor advertising on their own search results.

This form of ad poaching isn't new; it's been a practice for decades. But a recent Northeastern University study reveals that the entire brand ad ecosystem set up by Google, and replicated on other search engines like Bing and DuckDuckGo, is a "sham market," says Christo Wilson, a professor of computer science at Northeastern, who authored the study.

The paper is published in the journal Proceedings of the International AAAI Conference on Web and Social Media.

"Google and the other search engines have created this market where you can advertise on navigation and brand ads, but those ads are not very effective for competitors so they're sort of wasting their money," Wilson says. "As a consequence, the defending companies … also have to spend money on these ads and they're not really getting anything for it."

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