United States v. Google/Findings of Fact/Section 5D
- D. The Marketing Funnel
212. Advertisers use the different ad channels described—search, display, and social media—to accomplish different marketing goals, sometimes within the same campaign. Those objectives often are correlated to the ad channel’s unique features.
213. “The purpose of advertising is to capture consumers’ attention and drive them through to a point of conversion, and conversion is to purchase a product or service.” Id. at 3815:69 (Lowcock). Marketing professionals in industry and academia have used a “funnel,” pictured below, as a visual depiction of the consumer journey from awareness to purchase.
UPXD103 at 7; Tr. at 3815:11-13 (Lowcock) (summarizing the funnel as “[d]riving awareness, capturing intent, driving consideration, and driving a decision to purchase”).
214. The upper funnel focuses on generating consumer inspiration and awareness of the product. Tr. at 5121:16-25 (Booth) (e.g., “getting people thinking about performing a [home-improvement] project”); id. at 3816:10-11 (Lowcock). In the middle is the consideration phase, where the consumer evaluates a class of products or a particular product. Id. at 5122:9-10 (Booth); id. at 3817:24–3818:2 (Lowcock) (“The middle part of the funnel is to try and drive some sort of . . . behavior so to learn more about the product or service.”). The lower funnel seeks to persuade a user to carry out a transaction (e.g., a sale or other metric of conversion). Id. at 5121:21-25 (Booth); id. at 3818:3-8 (Lowcock).
215. Another way to think about the funnel is in terms of “push” and “pull” ads. “[P]ush ads are essentially an advertiser putting a message out there when a consumer isn’t necessarily even looking for something. Pull ads tend to [function when] somebody goes to Google or goes to Bing, is actively looking for something, [advertisers] have the opportunity to be able to respond to that query.” Id. at 5123:3-11 (Booth) (“So push [] is we’re sending our message out. Pull means we’re bringing people in who are already in market.”); id. at 6588:13-20 (Vallez) (“We generally think about search as pull,” and “[p]ush ads are generally more what we call upper funnel. They’re more video, display, that type of media, social media.”).
216. “The customer journey is complex. Consumers don’t consume media in a silo, so they experience media across all channels.” Id. at 3815:2-5 (Lowcock).
217. Marketers view different ad channels in terms of their relative strength at achieving objectives along the funnel. Generally, display ads are superior at establishing product awareness, whereas search ads are more effective at driving conversions. “One way to think about the difference between search and display/brand advertising is to say that search ads help satisfy demand, while brand advertising helps to create demand.” UPX411 at 638 (2008 internal Google email written by Hal Varian) (internal quotation marks omitted) (emphasis added); UPX459 at 871 (same); UPX439 at 112 (same); accord Tr. at 1174:20-23 (Dischler) (“If you want to get very broad, to reach a diffuse audience like someone used for TV, the search results page is a less optimal channel because it is [] more focused.”).
218. Display ads therefore are considered more effective upper-funnel tools and search ads more effective lower-funnel tools. Tr. at 3816:1-11, 3816:25–3817:1, 3819:12-17 (Lowcock) (“Display advertising is primarily intended to drive or create demand and drive awareness,” while “[s]earch advertising is there to capture intent after you have driven awareness.”); id. at 6586:2425 (Vallez) (“[S]earch is more often than not the last step, one of the last steps in that journey.”). Search ads can be effective for upper-funnel goals, see, e.g., James Dep. Tr. at 269:22–270:7, but that is not how advertisers largely conceive of them, see Tr. at 6881:20–6882:24 (Amaldoss) (discussing PSXD10 at 17) (summarizing based on a subset of record documents and testimony, 64% of advertisers view display ads to be higher up in the funnel than search ads, and 0% consider display to be below search). Google acknowledges that “[w]hen running Display ads, [advertisers] might not reach those who are actively searching for what” is offered. UPX8056 at .002; see also UPX8089 at 398 (“While the Search Network can reach people while they search for specific goods or services, the Display Network can help you capture someone’s attention earlier in the buying cycle.”).
219. Social media ads can be used at multiple stages of the funnel, Tr. at 4861:3-4 (Lim); Ramalingam Dep. Tr. at 151:7-11, but the marketing industry views them primarily as “push ads” to drive brand and product awareness, Tr. at 6588:23–6859:2 (Vallez) (describing social media ads as “push,” not “pull” ads, “because the consumer is not intentionally trying to pull information, . . . they’re usually getting a feed that’s being presented to them, different options, [] which may or may not be relevant to the context which they’re in”); id. at 4861:24–4864:1 (Lim) (JPMorgan Chase spends three times as much in paid search as in social, all of which is used for lower-funnel goals, whereas its social media spend is targeted to various stages of the funnel); id. at 6513:1-5 (Hurst) (Expedia spends on social media for the purpose of “buying an audience”); Dacey Dep. Tr. at 291:18-22 (“The intent of the user is very different and it’s a more passive user on paid social; whereas, in search, the intent is significantly higher and we can monetize it in a completely different amount.”); Tr. at 5123:24–5124:1 (Booth) (identifying social media ads as push ads “in some cases”).
220. For some industries, however, like clothing and cosmetics, social media ads can be effective for lower-funnel purposes. DX703 at 704 (Revlon advertising strategy placing social media in the awareness and consideration phases, alongside search in the latter); Tr. at 4892:1618 (Lim) (“[I]f you’re a direct consumer, fashion brand, you may consider paid social lower in the funnel than a bank.”).
221. Advertisers often use different ad channels as complements as part of a “full-funnel strategy.” Tr. at 5122:1-20 (Booth) (“What we try to do or what most advertisers try to do is try to nurture that consumer journey by showing them a bunch of options, presenting that in display or social, and then ultimately leading them down that transaction path.”); id. at 4894:15-17 (Lim) (“[M]ore often than not, it’s a combination of everything that you’re doing that’s driving that outcome.”). Google itself touts the importance of a “full-funnel” strategy. UPX8051 at .005 (2022 Google record concluding that “full-funnel marketing has never looked better or been more critical to business success”).
222. The marketing funnel is neither “dead” nor has it become “obsolete” because of the emergence of digital marketing and new ad technologies. See Tr. at 5649:2-13 (Jerath) (discussing DXD14 at 37). Industry witnesses consistently testified that they continue to use the funnel to shape marketing strategies, even on digital platforms. See id. at 3815:11-15, 3816:12-20 (Lowcock) (IPG); id. at 4857–4892 (Lim) (JPMorgan Chase); id. at 5121:1-10 (Booth) (Home Depot); id. at 5238:9–5239:3 (Dijk) (Booking.com); id. at 6512:1–6513:24 (Hurst) (Expedia); id. at 6585:25–6589:2 (Vallez) (Skai); Alberts Dep. Tr. at 45:18–47:8 (Dentsu); Dacey Dep. Tr. at 98:3-22 (TripAdvisor); Daniels Dep. Tr. at 19:14-23 (Thumbtack); James Dep. Tr. at 23:13–24:3 (Amazon); Levy Dep. Tr. at 104:11-18 (Meta); Lien Dep. Tr. at 186:5-15 (Marin); Ramalingam Dep. Tr. at 148:5–151:18 (Yahoo); Soo Dep. Tr. at 285:3–287:11 (OpenTable); Stoppelman Dep. Tr. at 83:4–84:19 (Yelp); Utter Dep. Tr. at 284:11–285:218 (Microsoft).
223. Even Google has recently and repeatedly recognized the continued vitality of the marketing funnel. See UPX427 at 030 (2019); DX241 at .010 (2021); UPX8051 at .002 (2022) (Google essay touting “full-funnel” strategies using Google Ads); cf. Tr. at 1413:10–1414:22 (Dischler) (contending that the funnel is “obsolete” but agreeing that advertisers use it “informally”); id. at 7791:7-16 (Pichai) (describing the funnel).
224. Large advertisers typically organize themselves along ad channels, with different teams and distinct budgets based on ad channel. See, e.g., Tr. at 4839:12-16 (Lim) (JPMorgan Chase has three departments: paid social, search, and programmatic); id. at 6590:23–6591:1 (Vallez) (advertisers generally have multiple teams managing different ad channels); James Dep. Tr. at 187:6-9, 190:9-13 (Amazon has different teams and leadership for paid search, social marketing, display, and video); PSX970 at 668 (advertising agency Tinuiti has different teams for paid search and paid social).