Over a year ago Google began testing a mortgage rate search within their Merchant Search platform in the UK. Not much more then a few blog post here and there discussed the new search tool. Most couldn’t imagine it going much further then just a simple test and the fact that it was circled around generating calls, not specifically data leads, added to the passive concern of so many.
With the new LendingTree suit against Mortech and the revelation of Google’s continued interest in breaking into the mortgage lead generation industry it has proven that the UK test was not performed on a whim and they did have long term intentions. What can be debated is what those intentions truly are. I think to do this we have take a look at more then simply the disheveled mortgage lead generation industry, but the online marketing industry as a whole.
Over the last 5-6 years the online advertising space has been shifting from the typical impression based pricing to click based pricing and more recently to the action based pricing model. In fact, in 2006 Google released the option within Adwords to work within the CPA pricing model, however I frankly don’t know what ever came of it. For that reason I don’t think much of anything ever did, but that may not be the case. Correct me if I a wrong. Regardless, Google noticed the shift and acted. Now, I speculate that they are continuing to act with the UK experiment and the current development of building out a mortgage loan pricing engine of sorts.
How are they going to use the Mortech technology, if LendingTree isn’t able to put a stop to it? Its my guess that they are going to allow people to price out their own loans, possibly allow the consumer to own their loan information or simply sell those inquiries on a per lead price. If this is their intent, my immediate question is where will it end? What will stop Google from running their own lead generation strategies in any other vertical?
I don’t think it is out of the question that Google would continue its push to a CPA based network and continuing to add more control over different verticals at the same time. There are verticals, like mortgage, where Google could easily bring clarity to the consumer as well as consolidate the wide range of quality and transparency issues. A platform similar to the UK merchant search, if positioned highly in the SERPs could easily affect a number of companies generating leads in the mortgage space. My guess, however is that it wouldn’t eliminate the competition completely, but it would make it much smaller. The shift to all encompassing portals with detailed content and information will have to be the norm. Simple arbitrage and landing page type marketing will not be able to compete.
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Assuming Google launched this in limited scale in US in November, that’s 1.5 years from the UK test. Assuming the planned the UK test for 6 months, 2 years and counting.
That’s blazing fast product development, there Google
So will Google Lead Gen put LendingTree out of business? Umm….
Froogle – hasn’t even dented Shopping.com, Nextag, Smarter.com, Shopzilla
Gmail – that put Hotmail and Yahoo Mail out of business
Orkut – RIP Facebook and MySpace
Google Video – they were getting killed by YouTube and even AOL
Google Voice/IM – Skype just sold for $2.75 billion; Yahoo IM, MSN IM, AOL IM not hurt by this
Chrome – distant 4th to Safari, Firefox and IE
Google Analytics – its free and syncs seamlessly with Google search yet hasn’t put Omniture out of business
Android – look at Apple and Blackberry stock prices since Android came out. Wow, what a downer
Google Maps/Earth – probably one of Google’s most successful builds. MapQuest, Yahoo Maps maybe lost share (I don’t know) but they are still around
Google Weather – they put weather results in search, just like mortgage quotes. Weather.com is still a huge business
Google Finance – I think its like #8 most visited personal finance site, even though they promote the hell out of it.
Microsoft circa Reagan/Bush/Clinton administrations – until the internet came around, unlike Google, now those guys WERE SCARY when they came after you outside their core business of Operating Systems:
MS Word – basically put WordPerfect out of business
MS Excel – SuperCalc and the others, toast
MS Powerpoint – remember Harvard Graphics?
MS Access – what did people even use before?
MS Outlook – Eudora? Lotus Notes? Hello?
IE – Netscape, billions of dollars of market cap and hundreds of millions of capital raised, slain
MSN – was putting a dent into AOL, and if not for FTC and their need for IE dominance over Netscape (thus they gave AOL a spot on the desktop in exchange for AOL switching to IE), probably really would have put the pain on AOL
But even MSFT wasn’t batting 1.000 back in the golden days – they took serious shots at Quicken, Quickbooks, Tax Software, and didn’t get anywhere. Expedia was successful; CarPoint.com and Sidewalk.com, Slate were not
MSNBC – money sink until MSFT got out of the biz
Interactive TV/OS for cable set top boxes – they invested billions in cable companies to try to win here, got nowhere
More recently –
Zune – loser
Xbox – put the hurt on Sony but Nintendo has thrived
James,
Obviously, very good point, but it is all about the implementation. You could argue that the implementation of many of those products were wrong, but thats not the point. The point is if anything even becomes of this and they allow their merchant search feature rank the highest on the SERPs, then there is no question that it will take clicks away from the organic and paid listings. Is it going to be an industry killer? of course not. Its only a bunch of “what if” statements.
2010 is going to be a very interesting arena in the mortgage vertical.
Great article!
There’s no doubt that the world of marketing is changing more quickly than ever before – driven by the on-line world.
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