In a massive move to promote local e-commerce and address competition issues, Google has recently introduced a “ZA South Africa” tag to highlight South African businesses in organic search results. This initiative is designed to promote local eCommerce, address competition concerns, and support the South African digital economy. This change comes in response to a 2023 ruling by the South African Competition Commission, which found that Google’s business model and market dominance were impeding competition within the country.
Google is tagging South African search results
The Ruling and Its Implications
The Competition Commission’s ruling found that Google’s dominance and business model distorted competition within South Africa. To mitigate this, several constraints were imposed on Google, including the introduction of a South African flag identifier and a platform search filter. This helps consumers easily identify and support local platforms, promoting a more equitable digital market landscape.
These identifiers are now visible when searching for South African platforms on Google. For instance, local e-commerce sites such as takealot.com, and travel platforms like safarinow.com and travelstart.co.za now feature a “za South Africa” tag or a South African flag in Google’s search results.
The Impact on South African Platforms
For South African digital marketing and e-commerce platforms, visibility on Google is crucial. As a de facto monopoly with over 90% of all general search traffic across devices, Google’s search result ranking heavily influences consumer behaviour and website traffic. The Competition Commission’s report emphasised the importance of appearing in Google’s search results, noting that consumers are likelier to click on the most relevant first results.
The report highlighted how Google’s search has evolved to give more prominence to paid results and its own properties over organic results for commercial searches. This change necessitates higher spending on paid results by platforms to maintain visibility, giving larger platforms with bigger budgets an advantage.
Remedial Actions & Support for Local Businesses
In response to these findings, several remedial actions were mandated:
- New Platform Sites Unit: Google must introduce a carousel to display smaller South African platforms relevant to the search on organic results, free of charge and in a content-rich display.
- Advertising Credits: Google must provide R180 million in advertising credits for small platforms to aid in customer acquisition and free training to optimise advertising campaigns.
- Support for SMEs: Google must offer R150 million in training, product support, and other measures for small and medium enterprises and black-owned online firms.
- Stopping Self-Preferencing: Google must cease giving undue preference to its own products in search results. This practice, prioritising its shopping and travel units, distorts competition by attracting a large share of consumer traffic.
The commission’s findings revealed that Google’s self-preferencing practices have been detrimental to fair competition. By implementing similar measures taken in Europe under the Digital Markets Act, the goal is to ensure regulatory compliance and promote a level playing field in the South African market.
Moving Forward
For businesses operating within the Digital Marketing sectors, these changes present both opportunities and challenges. Embracing these new identifying markers and leveraging the support provided can help local businesses enhance their visibility and competitiveness.
As Google continues to roll out these tags and adjust its search algorithms, staying informed and adapting to these changes will be crucial for maintaining and improving its online presence. This evolution in the digital marketing ecosystem underscores the importance of strategic SEO practices and the need for ongoing adaptation to regulatory changes.