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|Adsense Revolutionizes the web.|
When adsense first came out, i posted that we would see a dramtic change in the types of business on the internet and how they are run. Now 6 months on, adsense has begun laying the foundation for a new .com boom.
I personally know of a handful of publishers who have taken a 2 digit income before adsense and turned it into a 5 digit monthly income. These same sites are now feverishly hiring content writers, programers etc. Another 6 months of adsense and these sites will become strong forces online. How has adsense affected your long term goals and how has adsense changed your industry?
For those of us that are not into ecommerce and don't actually sell the product of service. It has been a nice change. I agree that the program has revolutionized the net, but I also think that the impact will also be limited. My observation is based on the following:
Regardless of the improvement, the money is in being the one that sells the product or service. The difference is that now the ones that funnel the traffic are getting compensated better.
Personally, it does make me feel good that hosting the stuff that I write pays for itself and leaves some pocket change behind. It has probably made me create more content, and pretty soon will allow me to get rid of a competing banner network making the site even less cluttered. Frankly, the other banner network only paid hosting costs, and was used so that I could fool myself into believing that I was not loosing money.
Edit: making it readable :)
[edited by: loanuniverse at 5:57 pm (utc) on Jan. 14, 2004]
While I agree loosely with loan, can I just point out that Adsense has allowed pure "information" site, which may or may not have high traffic, to more effectivly monetise their advertising space. I believe that these are the ones mentioned by markus. (And I can think of a couple more!)
I don't know that AdSense has revolutionized the Web, but it's certainly been manna from heaven for content sites.
On my own information site, AdSense has complemented affiliate sales very nicely--most notably, by monetizing subtopics and pages that weren't direct sources of revenue before. I don't let AdSense dictate what I cover, but it's nice to know that, if I do write about snowshoe walking tours of the Bernese Oberland in the winter or grape-stomping holidays during the Bordeaux wine harvest, there's a good chance that AdSense will serve targeted ads--if only for Bernese Oberland hotels or Bordeaux wines.
In my experience, I've operated a website for a niche area with 1k-2k visitors per day. This amount of traffic was not enough for big companies to come and invest in advertisement, thus I had very little advertisement revenue. With adsense, I've been able to have more targetted advertisers than a site my size would have ever had. In turn, it has allowed me to concentrate on providing more quality content and building a stronger community, because I don't have to worry anymore on finding advertisers to cover costs, and have a comfortable profit.
The things i enjoy the most with AdSense:
- The fun of writing new content and creating new pages and sites has now doubled for me.
- All the advertizers that refused to advertize at my sites in the past now advertize through AdSense _at_my_sites_ and i don't loose time and nerves because of enquiries, refusals, contracting and billing hassle.
Now, offer some better accounting, reporting, targeting and payment features, Google - your chance to make a new .com boom come true. Thanks.
I used to feel "used" for providing so much information that would benefit vendors. Now I don't. I feel like the tables have turned and that those who got a free ride off my own contents must pay for it now.
[edited by: Harry at 7:51 pm (utc) on Jan. 14, 2004]
|In my experience, I've operated a website for a niche area with 1k-2k visitors per day. This amount of traffic was not enough for big companies to come and invest in advertisement, thus I had very little advertisement revenue. With adsense, I've been able to have more targetted advertisers than a site my size would have ever had. |
I used to be associated with a "network of sites" that ranked in the MediaMetrix top 10. It was seldom able to sell targeted advertising even with millions of page views a day, and with perhaps several hundred thousand page views a day in its "travel channel."
For that matter, how often are the big banner networks able to sell targeted advertising?
There's always been huge advertising potential in the niches, and AdSense has made it possible for both advertisers and publishers to exploit that potential.
IMHO, the real strength and future of Internet advertising is in the niches, not on general news and entertainment sites or portals. Advertisers don't have a desperate need to buy run-of-network ads for Coca-Cola, Chrysler minivans, Tide laundry detergent, or Cartier watches on the Web, because there are plenty of conventional media that offer mass audiences or "lifestyle" audiences that are targeted by demographics. But for the advertiser who's selling purple fuzzy widgets to fuzzy-widget collectors or Bluewidget Canal Cruises to people who like canal cruising, the Web offers special-interest media targeting that, in many cases, doesn't exist offline. And AdSense is there to act as the intermediary between marketer and Web publisher. As AdSense evolves to give more options and control to the advertiser, its success and influence can only grow.
|AdSense will serve targeted ads--if only for Bernese Oberland hotels or Bordeaux wines. |
wish only adsense would serve the bordeaux wine as well :)
I think the 'revolution' began with ebay (p2p pricefinding: 1 person selling 1 item to an other person) and goto.com(overture): 1 company selling 1 item to x persons versus traditional media such as TV, newspapers etc. - and banner networks which tried to sell ads the same way the old media did and does.
Google is just executing ebay's/overture's business models extremely well and on a broader scale - to the benefit not only for the 'big ones' but also for the 'small publishers'
Killing the golden goose.
There are many people employing clickers to artificially generate adsense revenue. Adsense conversion is dropping, and its only surviving (maintaining bid rates) because the influx of PPC advertisers is increasing.
Once this influx slows, the bid prices will drop off like a rock. I personally expect that once Google splits content matches from search matches (allow advertisers to opt out), that content match adrates will drop way down to near banner ad levels, reducing the 5 digit income back to 2 digit income. I am just not sure how long it will take.
The reason PPC advertising works is because it converts twice as good as any other medium. Change this and the money will disapppear.
PPC ads on search engines will keep increasing, because it is targeted and converts much better.
nyehouse: advertisers already can opt-out. Please do your 'research' a little bit better next time.
I like AdSense, it's working fine for me at the moment. But generally speaking -- I don't like it very much as a concept.
Here is why.
With AdSense you are stimulated to make the site appear interesting, but be in fact junk. That way your CTR will sky rocket and profits will follow. One can say that AdSense like programs stimulate bait-n-switch kind of approach to web publishing.
I find the idea of micro-payments much more appealing, something along the lines of what John Walker is describing here:
Then web publishers will be paid for good, interesting content and the time visitors spend on their site, not for visitors leaving their site.
|With AdSense you are stimulated to make the site appear interesting, but be in fact junk. That way your CTR will sky rocket and profits will follow. One can say that AdSense like programs stimulate bait-n-switch kind of approach to web publishing. |
This is a good argument that would need to be addressed by quality control. However, I have not seen much of it already. I do agree that the potential is there.
I think that proponents of the program see it with "rose-colored" glasses, and opponents see it as some kind of evil aberration.
"The truth is somewhere in the middle"
There have been many people willing to write and publish unbiased information in niche fields. However, quality work takes time and cost money. There is a limit to how much time and money people will invest just to provide information to others.
Large general news and information publishers can get the advertisers to pay for it. Niche publishers, particularly those of us with "day" jobs and limited time, could not get the advertisers. "Publishers" who had something else go gain, such as sales people wanting to promote thier companies products did find it worthwhile to invest time and money into "information" sites that were biased to their products. There was no incentive for someone who whated to published a fair, unbiased, evaluation of different methods of peristaltic pump operation for diafiltration use, for example. (what ever that means :-} )
Now, with Adsense, even the "niche of a niche" sites can publish information, even sometimes pay experts for articles, with an income that will at least cover their costs and make a little extra money.
This will make it more likely that the web can be a source of otherwise difficult to obtain information. I have already seen some new information sites in narrow engineering fields. These sites all had Adsense.
I don't know about "revolutionize" but certainly it will improve the web.
|There are many people employing clickers to artificially generate adsense revenue. |
There are advertisers employing clickbots to harm their competitors, too. I'm sure that, when PPC ads were first invented, there were critics who said such fraudulent clicks would kill off PPC advertising. That hasn't happened, and PPC advertising is stronger than ever.
|Adsense conversion is dropping, and its only surviving (maintaining bid rates) because the influx of PPC advertisers is increasing. |
Says who? We've had reports here and on the AdWords forum from advertisers who have seen better conversion rates from content ads than from search ads--which merely goes to show that generalizations are foolish, and specifics are what count. Results will vary for advertisers (and publishers, for that matter) depending on the product or service category, the bid, the ad copy, where the ad runs, and other factors.
(For what it's worth, I'm still seeing many of the same advertisers on my site after six months, which would tend to imply that some businesses are quite happy with "content ads.")
I don't think there's much of an incentive to make one's site crap. A site still needs people to bookmark it and become return visitors. A site still needs inbound links to generate traffic and to give it decent position in the Google SERP's. That gives a big edge to quality sites -- more specifically, quality sites that are also carefully optimized for the search engines.
|nyehouse: advertisers already can opt-out. Please do your 'research' a little bit better next time. |
my bad - I was typing and not thinking. I meant that the ad rates are not separate. Overture recently announced separate bid network for contextual ads. When this happens on google, I expect these rates to drop compared to pure search.
|conversion rates dropping |
Obviously I do not know every case, but the 5-6 industries I track all favor search over contextual. I would love to hear some examples of industries where a direct search request converts lower than an indirect request. I am sure there are examples but a contextual ad is not much different than a targetted banner and we all know what happened with banners.
I am just trying to get as much money as I can while the golden goose is still shining. And yes, I have focussed on content more.
|I meant that the ad rates are not separate. Overture recently announced separate bid network for contextual ads. When this happens on google, I expect these rates to drop compared to pure search. |
Overture's Content Match program is geared toward large general-interest sites and isn't yet page-targeted, so its conversion rates inevitably will be lower than those of page-targeted ads on highly focused niche sites.
Having said that, I'll concede that Google content ads on the whole may convert at a lower rate than search ads. But the proper response to that is "So what?" Some search keywords or keyphrases convert better than others, too. That doesn't mean advertisers buy only the highest-converting keyphrases (or the keyphrases that are cheapest, or those that offer the highest ROI)--just as, for example, a vendor of mail-order car accessories doesn't buy ads only in the car magazine that offers the highest ROI: Unless the vendor is willing to reach only a limited audience, the vendor also advertises in the other leading car magazines because he can't count on 100% audience overlap.
Just the other day, I saw a marketer's post in the Google News forum in a discussion of Google's search results. As I recall, the member commented that search results were important (or words to that effect) because most Google search users don't click on AdWords. The implication of that should be clear: If you're a marketer who relies exclusively on search ads, you're giving up a large majority of your potential buyers. That may be a viable strategy for very small businesses, and it may be a necessary strategy for affiliate sites that work on very small margins (see this forum's thread on on Amazon.com ads), but larger mainstream businesses aren't willing to settle for picking the low-lying fruit and leaving the rest for others.
|Obviously I do not know every case, but the 5-6 industries I track all favor search over contextual. I would love to hear some examples of industries where a direct search request converts lower than an indirect request. I am sure there are examples but a contextual ad is not much different than a targetted banner and we all know what happened with banners. |
Actually, targeted banners can work quite well. (When I was running targeted affiliate banners on my travel-planning site, they were converting quite nicely.) Text ads normally convert better, though, as any affiliate manager will tell you. And I've never heard of an ad network or an ad-sales team that offered the level of targeting offered by contextual text ads like AdSense. When I had a European travel site on About.com, a "targeted" banner or skyscraper meant an ad for Hotwired or the South Dakota Department of Tourism. Certainly I can't think of a case where, for example, an article on Black Sea cruises on a site about Russian travel could display ads for Black Sea cruises as AdSense can. And it's hard to imagine that a search click on, say, "Black Sea cruises" would convert better than (or even as well as) a click from a reader who looked up "Black Sea cruises" in Google, found an article on that topic on a cruising or travel site, and clicked through to the article before clicking on an ad.
[edited by: europeforvisitors at 1:38 am (utc) on Jan. 15, 2004]
Adsense Revolutionizes the web indeed.
Quality and depth of content sites are getting improved on huge scale thanks to Adsense.
Thank you, Google! Adsense is the best thing ever happened in the Internet!
I agree with the revolutionizing the world statement. Adsense is a great deal for companies with a product to sell that want traffic. Best of all, Google is being fair to its advertisers. IMHO, most of the main players in the performance marketing have been rather slimey and routinely pull bait and switch games and diversionary tactics on their advertisers.
The key components to Google's succes are that adsense is being fair with to its advertisers and provides a relatively even playing field where small firms can bid alongside large.
I concur that affiliate abuse and quality control are a major concern. The low quality content issue is not about adsense...that is about SEO. SEO optimized spittle tends to outrank quality information. To keep the program vibrant, Google needs to aggressively stop abuse. My biggest concern is that Google might draw the wrong conclusion that small sites are the source or abuse and nix all small sites.
My experience is that small niche sites are generally the most honest. It is the midsized and large companies that tend to have the most questionable tactics.
You have good points, and you are right. I simple wanted to point out the risks of falling conversions as millions of pages of poor content designed to pull high adsense and the abuse of clicking by automated routines or people.
Adsense clicks still convert much better than most mediums but may not always be this way.
|I simple wanted to point out the risks of falling conversions as millions of pages of poor content designed to pull high adsense and the abuse of clicking by automated routines or people. |
Those are certainly valid concerns, and Google may have opened a Pandora's box by opting for Amazon-style ubiquity at launch. But I think we're likely to see changes as the program evolves that will allay at least some of the fears--e.g., more advertiser controls, possibly with a tiered pricing scheme so advertisers can choose between "go cheap and take your chances" to "pay a little more and pick your sites."
nyehouse...You could be absolutely correct when you say that advertisers get worse ROI on publishers sites as opposed to on the SERP's. However, there is a big reason why this may be so.
I have a site decicated to dog health issues. On one of my pages I talk about arthritis and joint pain in canines. Even though my page is purely about arthritis in dogs, I still get ads served from Google where the advertiser is trying to sell pain relief pills for humans with arthritis. My content is not junk, yet Google still has problems targetting correct ads.
This is neither my fault, nor the advertiser's fault. Targetting is not at an optimum yet. Of course, visitor's will click on the "human" arthritis ads out of curiosity thinking that it's an ad for canine arthritic medication. Thus, those advertisers would have a poor conversion rate.
Just my two cents...
<addition>These "untargetted" ads were showing up on my site in the beginning. I have since blocked them. But many other publishers probably don't even bother blocking irrelevant ads.</addition>
|Overture recently announced separate bid network for contextual ads. When this happens on google, I expect these rates to drop compared to pure search. |
...and then the Overture network publisher's revenues will decrease and they will sign up within Adsense.
I could have the worst/untargetted/painfull banner advertiser if the pay the same CPM than Adsense. Adsense is growing this way because pays very well to publishers and everyone wants have the code on their pages.
Europe's insights on contextual banner ads vs contextual text ads are interesting to me. I was quite frankly surprised to read what he had to say, since as an old print guy, graphics is what we sold.
This article from InternetNews backs up Europe's experience:
Now, that said, I have to say that more needs to be said.
Could AdSense be used for branding? And, no, you do not have to have graphics to brand (but it can help a lot).
I'm still trying to figure out what it is people are doing when they are online and looking at information and news. It is usually not like reading a newspaper or magazine--I know that.
For example, I'm a long-time reader of the Wall Street Journal. But, I signed up for a subscription online edition and canceled the print version. I can tell you that I approach WSJ.com very differently. All in all, I think it's a less worthwhile experience in many ways; but at the same time it's more worthwhile to my business since I have the WSJ.com filters set up to find news in industries and companies I'm interested in.
Therefore, looking at AdSense and other contextual services as a branding tool is fraught with the danger of the unknown. Ah, but it's sooooo tempting, too.
If I was a new player in the "inverse pump propeller" field, I'd want my name on every search result on the product--and with articles on inverse pumps--no matter if people click on the ad or not. And if I was the established player in the same field, I'd want to have my name on the search and articles as well to protect my brand. Now, how far can you extend that? And do you publishers want to see graphics to make it more appealing so as to drive up the prices paid? Ah, but if it's just branding and there is no real offer to drive clicks--uh oh, you publishers don't get paid, do you?
|...and then the Overture network publisher's revenues will decrease and they will sign up within Adsense. |
I'd be willing to bet that they did this because of advertiser pressure more than because it was something to do. If advertisers demand to pay less, or pull out of Overture, then why would they not demand it of Google which would also lead to Google paying out less?
The market decides this. Not Google.
|Could AdSense be used for branding? .... if it's just branding and there is no real offer to drive clicks--uh oh, you publishers don't get paid, do you? |
That's been a problem for CPC banner networks, but Google has a trick or two up its sleeve. :-) AdWords that don't meet a certain clickthrough rate are dropped, and since AdSense ads are also AdWords ads (i.e., ads that run on Google search pages), it's easy enough for Google to weed out ads that were designed purely for branding. Also, ad position isn't determined solely by bid; clickthrough rates are also taken into account.
|I'd be willing to bet that they did this because of advertiser pressure more than because it was something to do. If advertisers demand to pay less, or pull out of Overture, then why would they not demand it of Google which would also lead to Google paying out less? |
Overture may not have been responding to advertiser demand; it could just as easily have been trying to differentiate its new "content ad" program from Google's earlier, more established, and technically superior product. (In other words, it may have been trying to create demand instead of responding to demand.)
For the moment at least, Overture's content-ad product is far less targeted than Google's AdSense is. Until Overture can offer page targeting by keyword on special-interest sites, conversion rates and lead quality are likely to be inferior to those of AdSense.
That isn't to say that Google won't offer separate bids for search and content ads in the future. It very well may, along with other options that let advertisers pay higher or lower rates according to the degree of control they require.
|(In other words, it may have been trying to create demand instead of responding to demand.) |
That's what I thought the 20 percent discount was for?
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