It sometimes feel as though the writing has been on the wall for aggregators for as long as there’s been a wall. Philosophically, this is because they are perceived to be (or painted as) taking value from both ends of the chain:
- Retailers must pay them for sales/leads/traffic (think: affiliate fees)
- Advertising channels lose revenue to them as they offer a competing model (think: every use of the Booking.com app costs Google lost advertising opportunity)
As such, neither end of the chain likes them. Retailers want to squeeze aggregators to ensure they’re getting maximum value – hence the increasing importance of the role of analyst for retailers, desperate to know what they’re getting for their money and/or to chip their fees. In turn, the mechanisms designed to reward aggregators (affiliate/referral fees) are constantly downgraded
And meanwhile, advertising channels want to crush them altogether. Google finds ways to de-rank aggregators all the time on spurious grounds like “thin content” and “no added value” all of which is intended to push retailers back towards the deathly embrace of AdWords account managers selling the use of broad match keyphrases and high bids based on smoke-n-mirrors ‘quality scores.’
The counterpart to all this is that aggregators do have genuine utility – and thus value – to the ironically least-valued part of the chain: consumers.
Confused and GoCompare etc are mere aggregators in the technical sense, but where else, realistically, would you head to get an insurance quote? From a consumer perspective, the experience is near perfect: put in what you want, get transparent market prices and utility, and act accordingly.
But even here, you can see how their role as honest brokers is under attack at both ends of the chain.
It might have came to nothing, but Google bought comparison engines and promoted them ahead of organic listings for these sites. Meanwhile, the quotes you see on the site are increasingly just starting prices onto which the retailers ladle extra options – forcing you to phone them to navigate your way through an extended sales pitch to a higher price than the one you were shown.
So, although aggregators are often depicted as agents of bad faith (Google: “they offer nothing to the customer experience!” Retailers: “why should I pay extra for a sale I would have made anyway?”) more often than not they are at the mercy of attacks from these two directions. In most cases, it’s not a battle they can sustain. In the end, most fold and the retailers’ advertising money goes straight to Google (where, lest we need reminding, profit has to be found in a system designed to drive margins to zero).
Now, it is true that I work at an aggregator, so you can see my personal slant on this is coming from: we’re effectively locked out of the SERPs by Google whitelisting three or four major aggregators and splitting the remaining long tail traffic between retailers’ own sites and non-competitors such as review sites.
It’s also true that I’ve sat through a lot of pitches over the last couple of years where SEO salesman have said that an aggregator site like ours can link build their way into this space with relatively trivial budgets and some technical tweaks.
Well, a few years ago I was on that side of the desk making that pitch myself, but sitting at this side of the desk you see how pressure from people who advertise with you turn your notional budget into a zero sum game: to develop a strong SEO position means taking cash from a budget that is constantly hammered for Results! Today! and thus finds its way into AdWords instead. It is, simply put, a circle that cannot be squared. Growth takes time, and time is money and this is why aggregators are trying to bypass the online game by going through TV.
Trivago advertise all the time to human eyeballs in human houses in the hope that I’ll remember them next time I’m booking a hotel (incidentally, this is why things like rebranding Yell.com to… whatever it is now – and I genuinely can’t remember – is the height of stupidity) and why? Because they are building a brand.
People have been talking about ‘brand’ forever now (shit, I was writing about this 8 years ago!) but it remains the single most pertinent thing: in a cacophony of 24/7 advertising, viral spoofs, news jacking, PR shills, social media puff and manufactured conspiracy, who retains market share? Brands.
So when you look out of the window into your competitive space in 2018 that should be your starting point: brand. Do you have one, and if not – how will you get one?