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How to make Smartpricing work to your advantage
A four-step, EPC-based strategy to maximise income and beat junk ads
21_blue




msg:1339685
 5:34 pm on Apr 11, 2006 (gmt 0)

An EPC-based strategy
The most important number to publishers is, as for other businesses, bottom line earnings. But most successful businesses focus on improving other numbers in order to succeed, eg: customer feedback rating, quality measurements, etc.. Many Adsense publishers seem to concentrate on eCPM, valid for some inter-advertising-source decisions, but in this post Iím going to outline a strategy based on EPC that, imho, has a number of potential benefits for those looking at intra-Adsense decisions.

This strategy wonít increase the potential earnings of your site Ė only additional content or functionality will do that Ė but it will bring your siteís earnings nearer to its potential. That is, it wonít increase your site ceiling, but it will take your earnings more consistently to that ceiling.

Background
I had significant success last year with an EPC-based strategy. After experimenting with various other approaches, I was prompted to return to this strategy by a recent thread [webmasterworld.com] started by Chris999. This proved to be an important piece in the jigsaw puzzle of smartpricing. Since then the pattern of last year has been repeated: earnings have been at a consistently high level, compared with much greater ups and downs previously. In fact, average daily earnings are now running at a record level, despite the slight decline in visitor numbers, normal for my business-oriented site as we approach Easter.

Why focus on EPC?
EPC, indirectly, provides ďcustomer feedbackĒ. Whilst Smartprice has an account-wide element, updated once or possibly twice a week, it also has a page (URL-oriented) element that seems to be updated daily. Although Google donít provide us with data on conversions and other smartpricing factors, EPC gives us feedback on the impact of smartprice.

If, when measured over a monthís timescale, EPC on a page is in the same ballpark as Adwords prices, then the page is probably not being smartpriced downwards, or not by much. But if the page EPC is significantly lower, then the smartprice algorithm reckons that the page is a problem for some reason, eg: poor conversion rate or content that is not directly relevant to advertisers. That is, EPC (when related to Adwords rates) provides quantifiable customer-feedback on the performance of the page.

As with other businesses, the key to success is to identify where there is poor customer feedback, identify the cause of that poor feedback, and then resolve the problem. When Iíve taken this EPC-based strategy on my site, the benefits have been an increase in site income, junk ads disappearing off the site (removing the need to block them), and an improvement in site stickiness.

There is no guarantee that the strategy works for you, but I lay it out here so that, if you have the time and inclination, you can give it a try. The strategy also has some other spin-off benefits, such as better quality clicks for advertisers, increased income for Google, less income for purveyors of junk ads, and if lots more people did it, a better reputation for the Adsense scheme.

The EPC-based strategy
The first step is to collect relevant information. You need to know:

  1. the EPC over the last month for the most popular pages on which you have Adsense (I monitor the top 200). You can do this by setting up URL channels (specific custom channels can provide more accurate data, but itís a lot more work and the URL channel information is good enough for this purpose). It is important to collect this information for a month, because that is the period over which smartprice operates. Any period less than that yields increasingly unreliable information.
  2. the current Adwords rates for your niche, or for the various niches covered by your popular pages. You can get this information by setting up an Adwords account and using the traffic estimator.
  3. which pages are being hit hard by smart price. You can work this out by identifying which pages have a very low average EPC by comparison with the Adwords rates (this can be made easier by downloading the CSV file of your URL channels into a spreadsheet, creating a column to calculate EPC, and sorting the list into ascending order of EPC).

The second step is to try to improve EPC on the worst-performing pages. You can do this by following other advice in this forum, eg: moving ads to above the fold, reducing the number of ads on the page, ensuring that the most visible ad block loads first, etc..

The third step is to monitor your changes at least until a couple of days after your next account-wide smartprice update (Iíve described how to work out when that takes place in my Golden Gate post [webmasterworld.com]).

The fourth and final step is to remove ads altogether from low-EPC pages. Replace the ads with links to other pages on your site, promoting higher EPC pages. Donít try to dupe users into going to pages to click on ads, try to maximise the chances that they will find a page relevant to them.

Final comments
This strategy depends on you having a content-rich site, with easy site navigation, and your willingness to spend time optimising your most popular pages. Although it requires an investment of time, it is mostly a one-off investment and will repay your efforts.

 

spaceylacie




msg:1339686
 7:30 pm on Apr 11, 2006 (gmt 0)

"Replace the ads with links to other pages on your site, promoting higher EPC pages."

I've been thinking about doing this on one of my newer sites about a current trend in my niche. I was lucky to be the first one to publish in depth about it online. The problem is, tons of visitors(including many repeat) but a very low EPC and CTR compared to other sites in my account. The number of visitors somewhat makes up for it in the final numbers, but nothing to brag about. 21_blue, would you advice that I remove all ads from the site and replace them with ads for my more profitable but related web sites? I might be willing to test it out.

21_blue




msg:1339687
 7:49 pm on Apr 11, 2006 (gmt 0)

spaceylacie wrote:
tons of visitors(including many repeat) but a very low EPC and CTR compared to other sites in my account.

There are three things that come to mind.

Firstly, imho, the EPC comparison with other sites is not the right one to make. The key question is how does the EPC compare with Adwords rates for topics relevant to the site being discussed?

Also, removing things site-wide is too broad, like trying to open a can of beans with a spade. There may be one or two high volume pages that are dragging the EPC for the whole site down. Try eliminating ads from the lowest-EPC pages first and you may find that other pages' EPCs jump up.

Finally, I found that if I promote other pages that are not that relevant to the first page, the EPC on the referred-to page can fall. The key is to refer to pages that are high EPC and relevant. One trick is to use a quick feedback form to find out why people are visiting the page. On one popular page I found 3 main reasons, two of which we had high EPC pages for. I replaced ads with referrals to those pages, and their income increased.

spaceylacie




msg:1339688
 8:50 pm on Apr 11, 2006 (gmt 0)

So you are suggesting that if it's "the going rate" than other sites in my account won't be affected by a low EPC on one of the sites? I checked the keywords and they are cheap in Adwords so it looks like I'm getting about the "going rate". I guess I'll just hope that more advertisers pick up on the trend and the site eventually earns more fractions of a penny per visitor.

Scurramunga




msg:1339689
 9:00 pm on Apr 11, 2006 (gmt 0)

The fourth and final step is to remove ads altogether from low-EPC pages. Replace the ads with links to other pages on your site, promoting higher EPC pages. Donít try to dupe users into going to pages to click on ads, try to maximise the chances that they will find a page relevant to them.

I have been doing this for five months and it works very well.

21_blue




msg:1339690
 9:04 pm on Apr 11, 2006 (gmt 0)

spaceylacie wrote:
it looks like I'm getting about the "going rate". I guess I'll just hope that more advertisers pick up on the trend and the site eventually earns more fractions of a penny per visitor.

Well, if the going rate in Adwords, for this site's topics, is currently what you are getting, then that suggests to me you may as well leave the ads on the site. But unless something drastic happens, this market is unlikely to make you your fortune.

You could still try the idea of a quick feedback form to find out why they visit the site, and then see if that leads into any higher-paying topics. Also, you could put links to your other sites somewhere to see if you can direct them to better-paying topics. But in doing so, don't damage existing ads EPC: eg: they can replace ads, or go elsewhere on the page, but not displace them down the page.

spaceylacie




msg:1339691
 9:54 pm on Apr 11, 2006 (gmt 0)

Thanks for your help. I've always been a strong believer in dropping ads from low performing pages, but I see that it's just a low performing topic in general. But, hey, I'm one step ahead: I've already found out about one area(high paying comparatively) that the visitors are also interested in and in fact launched a site about it a couple of months ago. It needs more work before I feel comfortable fully promoting it to my other visitors, but I'm working on it.

Scurramunga




msg:1339692
 2:16 am on Apr 12, 2006 (gmt 0)

In my situation dropping ads from low performing pages has undoubtedly made a significant difference. There are pages on my site where I will not be placing ads ever again based on their history.

Only about 25% of pages on my site carry ads. Of these about 5-10% or so are removed or replaced daily/weekly in accordance with observed trends, ecpc trends ctr trends etc. Then there is a core of about 20-25% (of the total site) that are more permenant but subject to trimming (such as last week) when performance drops.

My site is not large and my uniques are are very low but on just as little as 7 pages allows me to pull in about $100 on some days

TOS prevents me from disclosing specifics, however my ecpm and ctr are usually extremely healthy.

flashher




msg:1339693
 2:46 am on Apr 12, 2006 (gmt 0)

i am not familiar with adwords, can u tell me how i can get the adword rate for my topic/keywords?

david_uk




msg:1339694
 3:11 am on Apr 12, 2006 (gmt 0)

I've long been an advocate of only putting ads on pages where they work, and dropping poor performers. When Google started CPM advertising, I suggested that it would be good if webmasters could choose between cpc and cpm ads on a page by page basis on the grounds that Google know diddly-squat about what ads work on what pages, and webmasters do.

My reasoning is precisely that I have some pages that I know adsense will not work on - therefore I've removed ads from them. However, these pages historicaly get very good visitor numbers. If I could use my knowledge of my site in choosing where to show what ads, then that would make myself and Google more money. However, I got howled at for wanting to cherry-pick ads by the "Google's algorithms are faultless" brigade.

Anyway, my point is that it's an idea that may be wirth revisiting.

marsradio




msg:1339695
 3:43 am on Apr 12, 2006 (gmt 0)

I can't agree more with David_UK!

Who the heck else knows our audience (visitors) more than us - the Webmasters of our own sites. We know what they are interested in. Why can't we have more control on tayloring what ads show up on our sites? It's not enough to just be able to reject a certain ad with the competitive filter.

Scurramunga




msg:1339696
 7:50 am on Apr 12, 2006 (gmt 0)

However, I got howled at for wanting to cherry-pick ads by the "Google's algorithms are faultless" brigade.

Adsense optimisation requires experimentation and is hit and miss for all of us at the best of times. Those who advocate taking a cookie cutter approach, putting ads everywhere and leaving everything to the algo must have their heads stuck in the sand.

21_blue




msg:1339697
 8:23 am on Apr 12, 2006 (gmt 0)

how i can get the adword rate for my topic/keywords?

Set up an account at:
[google.com...] - you'll have to consult Google help pages on how to use Adwords as it is such a big topic. There is also another forum in WW world for adwords. But to find out the rates you'll need to set up a dummy/test ad, use the "traffic estimator", then quit the ad without publishing it.

David_uk, Scurramunga, et al, as a point of clarification, I haven't removed ads from all low performing pages. I've removed all pages that still have a low EPC relative to Adwords rates, even after I've tried to improve EPC. This means:

  • I have removed ads from some pages that, in the context of my site, seemed to be 'performing well' (ie they had a healthy CTR and reasonable eCPM)

  • I have retained some channels that are ostensbly 'low performing' (ie they have a low CTR and eCPM). Collectively, these pages provide a healthy slice of my income.

  • I've managed to avoid removing ads altogether from some low-performing pages by improving the EPC (eg: just having a 125x125 or 125x250 unit above the fold).

What I'm suggesting in this thread therefore differs in two ways from the conventional approach to removing low performing channels.

  1. I'm defining 'low performing' in a very specific way (by comparing average EPC for the last month with Adwords rates). This probably means I've removed some different, and fewer, pages than in a conventional strategy.

  2. I'm trying to 'rescue' low EPC pages first by cutting down the number of ads to a minimum (steps 2 & 3 in my strategy)

The benefit of this precision approach, I believe, is that it gets more income out of your site (eg: I've had 2 record days so far this week) and closes all the little openings through which junk ads manage to burgle your site.

flashher




msg:1339698
 9:27 am on Apr 12, 2006 (gmt 0)

what if i have a page with high traffic (from search engine), but the EPC is quite lower than the adword rate?

It seems risky to remove the ads from it... right?

flashher




msg:1339699
 9:45 am on Apr 12, 2006 (gmt 0)

.... just logged in my adword a/c and tried the traffic estimtor. What i saw is the average CPC is far higher than what I got pay per click on my topic...

What should I do? remove all the ads from all of my pages? There must be something wrong with my site I guess... any suggestions?

21_blue




msg:1339700
 10:19 am on Apr 12, 2006 (gmt 0)

flashher wrote:
what if i have a page with high traffic (from search engine), but the EPC is quite lower than the adword rate?
It seems risky to remove the ads from it... right?

To remove it from the page would be to jump from step 1 to step 4, in the strategy I outlined. This could be a bad idea for two reasons:

  • It may actually be another high volume page at your website, with even lower EPC, that is dragging the smartprice of your site (and this page) down.
  • You may still be able to get a reasonable income from this page by optimising the ad position

Having said that, this page sounds like a good candidate for change. I had a similar issue with a couple of pages at my site, both in the same niche/topic area:

  • In February, page 1 had a very low EPC, it generated 12% of Adsense impressions (largely from Search Engines), 10% of clicks and 2% of earnings. This month, it has generated no clicks because I've removed the ads altogether, but put a link through to page 2, which...
  • In February, page 2 had a moderate EPC, generated 8% of ad impressions (largely from internal navigation), 1.5% of clicks and 1% of earnings. This month, it is generating about 18% of ad impressions, 3% of clicks and 3% of earnings. The average EPC is about the going rate in Adwords.

So, looking at these two pages, it seems I've gained/lost very little by making the changes because they made 3% of earnings before and after. Except, the overall earnings of the site have increased significantly because the EPC on other pages have increased (due to smartprice) and because site-stickiness has improved (there are more click exits on other higher-EPC pages now). Actually, the income from these pages has also ncreased, because 3% of the new earnings level is actually more than 3% of the old earnings level.

Incidentally, the latter page is still "low performing" in terms of both CTR and eCPM, compared to the rest of my site, but the EPC suggests it is converting well. So it is earning 3% that, by removing ads, I would simply lose and it may even be helping support the site and/or account-wide elements of smartprice.

So, assuming that you have lots of other pages at your site covering topics related to your high volume one (this strategy is based on a content-rich site) then I suggest that first you try to increase the EPC and other site earnings - say:

  • cut down the number of ads leaving, say, just one block with one or two ads above the fold.
  • put some links above the fold to some of your other related pages that have a high EPC
  • see how that performs for the next couple of weeks (allowing for any unusual fluctuations over Easter).

If at the end of the fortnight the EPC is still very low on that page, remove the ads completely from that page and replace with links to other high-EPC, related pages.

Incidentally, I suggest that whenever you make a change to the site, you write it in a log so that, in the future, you can do a historical comparison of changes to your site vs changes in earnings. I've found my weblog invaluable. Also, whenever you make a change make a complete copy of the website on your computer so that it is easy either to roll back any changes you made, or so that when you review your log you can compare the page designs to see exactly what you did.

21_blue




msg:1339701
 11:29 am on Apr 12, 2006 (gmt 0)

Correction: in my opening post I said you could find out when smartprice updates on your account by looking at my Golden Gate post. In fact, that post is about natural fluctuations in site statistics. The correct reference is here:
[webmasterworld.com...]

Hobbs




msg:1339702
 4:12 pm on Apr 12, 2006 (gmt 0)

Excellent post 21_blue, it's people like you that put in the time and effort to give others the concentrate of their experience that make this forum what it is.

flashher




msg:1339703
 4:24 pm on Apr 12, 2006 (gmt 0)

.... just logged in my adword a/c and tried the traffic estimtor. What i saw is the average CPC is far higher than what I got pay per click on my topic...

I think I didn't set the max CPC and allow google to suggest it.... that is why i got those high numbers.

So, how to get a realistic CPC? How to determine the max CPC limit?

21_blue




msg:1339704
 4:47 pm on Apr 12, 2006 (gmt 0)

Thanks for your comments, Hobbs.

flashher wrote:
how to get a realistic CPC? How to determine the max CPC limit?

  • Make sure that budget optimiser is switched off (the setting is in Edit Campaign Settings - Bidding Options, Advanced)
  • Get to the traffic estimator (Create a new ad group; Name your ad group (eg: "test") and press continue; Enter dummy ad details, but using a valid URL, and press continue; type in the main keywords of your site (eg: "blue widgets") and press continue; click on "view traffic estimator"
  • firstly, leave the maximum CPC blank. The "Estimated Avg. CPC" column will indicate the likely high end click values
  • secondly, try entering and then reducing your maximum CPC values (say, starting with a dollar and working down in 10 cent steps) and pressing "get new estimates", until the Estimated Ad Positions change from 1-3 to 4-6. The value at which the number changes is a rough indication of the lower threshold for click values. Ie: if you have average EPCs below that value then smartprice is possibly starting to play a role.

NB: The market value of clicks in niches can change over time.

CainIV




msg:1339705
 6:12 pm on Apr 12, 2006 (gmt 0)

Excellent suggestions, and overall one of the more useful posts I've seen here in quite some time, thankyou very much for your time.

I have used your steps to conclude that my average EPC is less than 1/3 of what is found in Adwords. This would mean then that Smartpricing has taken over and that I should utilize the four steps you mentioned earlier to raise EPC on those pages?

21_blue




msg:1339706
 6:42 pm on Apr 12, 2006 (gmt 0)

my average EPC is less than 1/3 of what is found in Adwords. This would mean then that Smartpricing has taken over...?

It could do. Though, it could also be a result of having too many ads on some pages (as Chris999 suggested in the thread I cited in my opening post).

However, even if your average CPC is low mostly due to the 'Chriss999 factor' rather than smartprice, following steps 1 to 3 will help you identify on which pages you need to reduce ads, and from which you need to remove them completely.

On my main site, some pages have space for only 1 advert (a 125x125 box) whilst others have space for a dozen adverts or more (typically skyscrapers and banners). The 125x125 pages still produce a low eCPM (due to low CTR), but the EPC value is now higher than the rates I'm typically quoted in Adwords.

spaceylacie




msg:1339707
 10:18 pm on Apr 12, 2006 (gmt 0)

I thought of something and think it needs to be added to this thread.

Low performing pages do not always stay low performing.

I have a site that has it's own in-house SE to search the site's database and I tried Adsense on it. The results were terrible. So bad that I removed all the ads after a couple of months.

6 months later...
I read a post(I think it was here at WebmasterWorld) about someone making good money from Adsense from a niche SE. I thought, that can't be right, but decided to try the ads again anyway. Sure enough, it worked. I would be missing out on a pretty penny right now if I hadn't re-tried Adsense on the pages.

To reiterate the point:

Low performing pages do not always stay low performing. Make sure to occasionally go back and try ads again on pages that were low performing in the past. Every 6 months to a year would be adequate, more often would be better. Otherwise, you could be missing out on some $.

annej




msg:1339708
 1:25 am on Apr 13, 2006 (gmt 0)

However, these pages historicaly get very good visitor numbers. If I could use my knowledge of my site in choosing where to show what ads, then that would make myself and Google more money.

I'd like to be able to do this as well. I have taken adsense off of my content pages for each subsection. People don't click on the ads because there are too many other choices that would interest them. Yet they have high traffic rates.

21_blue




msg:1339709
 10:51 am on Apr 13, 2006 (gmt 0)

spaceylacie wrote:
Low performing pages do not always stay low performing

I think this is a good point, as is the converse: high performing pages do not always stay high performing. However, I think there is a difference between a short term blip and a long term trend - I've come to the view that it is best to leave pages alone during a 'blip', and only make changes when there is a long term change in page performance.

DamonHD




msg:1339710
 12:13 pm on Apr 13, 2006 (gmt 0)

Hi,

I always do some random infrequent sampling of all possible layouts, etc, to look for changes for blips to trends...

Rgds

Damon

CainIV




msg:1339711
 4:37 pm on Apr 13, 2006 (gmt 0)

following steps 1 to 3 will help you identify on which pages you need to reduce ads, and from which you need to remove them completely.

Does the reduction or total removal of ads on poorly performing pages boost the value of clicks and revenue generated from better performing pages?

21_blue




msg:1339712
 6:03 pm on Apr 13, 2006 (gmt 0)

CainIV wrote:
Does the reduction or total removal of ads on poorly performing pages boost the value of clicks and revenue generated from better performing pages?

Yes. For example, I've just looked at the performance of one of the 'better' pages. Since removing ads from another low performing page and linking to it:

  • EPC and eCPM have gone up by 25% (on that page)
  • impressions and earnings have risen by 50% (on that page)
  • CTR has remained roughly the same

The overall increase in earnings I'm seeing, therefore, is through seeing a significantly improved performance in those pages that were already performing well.

Having said that, I'm sure that a contributory part is played by the quality of the content and site stickiness, as I've also seen a 20% increase in the proportion of visitors viewing more than one page.

CainIV




msg:1339713
 8:17 pm on Apr 13, 2006 (gmt 0)

Excellent! How long would you estimate it takes Google to colect data on the pages and change on it's end the smartpricing calculation once I've removed, lets say x amount of ads per page?

21_blue




msg:1339714
 8:31 pm on Apr 13, 2006 (gmt 0)

Bear in mind that Easter is upon us, so that might distort short term figures somewhat, depending on your niche (Friday and Monday are holidays in the UK).

But that aside, after putting in links to other, better pages, I hope you'll see an immediate improvement, not due so much to smartprice as users exiting via better quality clicks on the referred to pages.

Thereafter once you've been through the whole process (including removing ads completely from pages that you can't improve at all) there will be some further improvements in the next few weeks as the site/account-wide smartprice improvements kick in depending on what day smartprice updates [webmasterworld.com] on your account.

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