If you haven’t heard already, yesterday GAN announced that they will be winding down their operations over the next few months. To anyone that has been paying attention, this is not surprising news.
GAN has been a bad fit for Google from the very beginning. As Google has extended its tentacles into almost every aspect of online marketing, so the conflicts created by it having its own affiliate network became more apparent. Stories about publishers being unable to promote certain products, or to buy traffic from other search engines or even to get their promotional emails past Gmail’s filters were commonplace.
What was worse was that the GAN interface and tracking technology fell behind the competition some time ago and they have never seemed to want to invest in improving it. Certainly, as we compiled the Blue Book rankings each years, it was clear that affiliates were becoming more and more disillusioned, even as GAN’s staff bitched at us at their relatively lowly ranking.
The truth is that GAN was a distraction for Google and is just too small a part of their business to bother with. The trouble for companies like Google is that affiliate marketing is hard to scale – you need lots of affiliate managers and customer care. Google likes businesses that will run on algorithms, and the one that is running away with the online retail algorithm is Amazon. Amazon Marketplace is making billions of dollars. Marketplaces generally are where major companies like Rakuten are investing their money. That’s why Google is building out Google Shopping as fast as it can.
Google Shopping killed Google Affiliate Network. It’s that simple.
The reality is that Google killing GAN is the right thing for them to do, and that it is good for everybody else as well. Google gets to concentrate on what they are good at. Publishers will find other networks that are frankly better. The options for merchants will expand once they have worked through the transition away from GAN. And other, better networks will pick up the slack.
The affiliate marketing industry doesn’t need to mourn a second-rate network owned by an uncaring parent company with conflicting business interests. It’s better this way, for all of us.