There are many flaws to this methodology.
The problem is that those top 3 may have opted out of content, leaving lower paying ads.
You might be checking bids for single "keyword" while AdSense is targeting ads to that page for "keyword keyword2 keyword3" phrase.
Some advertisers who have one of the top slots in search may have set up a lower bid price campaign for those same keywords in content. (ie. bidding $1 for search, but only $0.20 for content).
I don't think AdSense is doomed, since they still pay significantly higher that competitors (except for a couple of niche markets that tend to be higher in fraud, with more advertisers pulling out of content).
One flaw - Advertisers turn off content.
Here's another flaw.
Publishers drop Adsense.
Not all of us think that it is worth it anymore.
We are weary of chasing bread crumbs. And 2-cent clicks.
|Have you ever considered why Google is so secretive about their Adsense Publisher payout? Their is only ONE REASON - they don't want you to know how poor it really is. Period. |
A more likely explanation is:
1) They don't want to help competitors cherry-pick the most profitable AdSense sites by offering higher rates;
2) Their compensation formula isn't as simple as a straight percentage split;
3) They want the ability to adjust the compensation formula over time--e.g., by paying more for certain levels of revenue of profitability;
4) They don't want to deal with constant complaints from publishers who can't understand why Johns-big-and-highly-profitable-site.com is getting a higher payout than Jims-small-and-barely-profitable-site.com.
If you're really offended by Google's secrecy, there's an easy solution: Pull the AdSense code from your pages. The Google TOS allow a publisher to suspend participation or withdraw from the network at any time.
I agree with all the above three points from Genstar and want to add one more.
In Adwords bidding system, you never know the actual CPC for each ad except your own ad. If you prefer to the AdWords "Traffic Estimator", the CPC you get is at the maximum based on a default CTR. This max. CPC may be twice or three times the actual cost for the same position.
This is true. There are some publishers dropping the AdSense everyday. However, there are lot of publishers who are very happy and stay with AdSense over a year.
Dear Sally Stitts,
I would like to remind you that this is not yahoo's GOOG board. In my oppiniion it is really bad idea to badmouth GOOG stock here. It certanly looks like you've got a trackload of GOOG puts and scared ***less to lose your gamble. The GOOG stock is sure expencive but guessing the tops and bottoms is never easy and it is at least irreponsible to offer us "peons" to help you out of the ***hole you got yourself into. Particularly, by promoting such nontrivial financial instruments as stock options.
Some "Peons" who are on this board make a living by developing the Internet and with great help of AdSense, one of very few decent advertising networks out there.
I am sure that such an investment guru as yourself had already read latest GOOG's 10q SEC filing. And one who can read can see Google's statement that "Traffic acquisition costs as a percentage of advertising revenues from Google Network web sites is 80% for 3 month ended June 30th 2004". Assuming that 5-10% goes to other expences (like adsense hosting expences) 70%-75% goes to publishers. Your claim of 20% publishers cut is noncens.
Note: Jut to put in the content. Please note that there was another post from Sally Sitts online on this forum promoting buying GOOG puts in order to make reaches from "imminent" GOOG drop. I cannot find that post anymore though, aparently deleted by mods.
|If you're really offended by Google's secrecy, there's an easy solution: Pull the AdSense code from your pages. |
There's a brilliant suggestion, Sally. I can't figure why it didn't occur to you before.
|Google's quick ride is OVER |
Funny that. The first time I heard it was over a year ago. I suppose we'll still keeping hearing it a few years from now :)
|The 3 top bids are very stable and are over $1. |
How can you know that unless you are the one making the top 3 bids? Bids are not public on Google. Unless you are making the mistake of assuming that Overture and Google have the same bid for the same search terms. People around here tend to make that mistake a lot.
Jenstar - What "methodology"? Studying data? Asking questions? Seeking answers? Making bold statements to elicit strong feedback?
EFV - Your post was perfect, and exactly what I was looking for. Your posts are always helpful, and well thought out, as opposed to simply being dismissive.
fdmaster - Take a deep breath. I have NOT done any stock transactions for over 3 years. I have no intention of doing it here - way too risky.
I'm not promoting anything - I AM JOKING. I had to go back and make that clear - it wasn't just you.
Next time, I will wait until April Fool's day. Thanks for the outing, however inevitable.
Doesn't anybody have a sense of humor any more?
Does no one understand the phrase "tongue in cheek'?
Have you ever been bored, and tried to stir up some cogent discussion?
Whatever the share is. Google still pays more than any other ad company I have seen. That is what counts.
The reason why we are serious is that we are making serious money from Google.
Plain and simple.
The 3 top bids are very stable and are over $1. ...
EPC is ALWAYS LESS THAN ONE-FIFTH of the bids.
20% is NOT 50%.
So, 3 people are paying a buck per click. What about the 300 people who are willing to take whatever traffic they can get for .05 cents a click? The top 3 bids tells us nothing. You'd have to know the average of all bids for the field to come anywhere close to guessing the % cut for publishers.
|EPC is ALWAYS LESS THAN ONE-FIFTH of the bids. 20% is NOT 50%. |
Interesting post Sally_Stitts, but you make a fundamental error in assuming the percentage of a bid shared by Google has any relevant. The total income that can be generated with AdSense in a set period of time over other alternatives is the primary measure a good business person looks at when making decisions based on financial issues.
If Google pays me only 20% of the bid but my total AdSense income is 100% more than I can make with alternative income generating schemes, I’d be a fool to drop AdSense and move to these other schemes.
Now, you could have a point if your argument is that Google is being dishonest by telling us one thing (“We share 50% of the bid with the publisher.") but is actually delivering something else (only giving out 20% of the bid). I would not agree with you, but at least it would be a logical contention.
>>And 2-cent clicks.
If I had 2 cent clicks I'd drop AdSense too.
At the risk of sounding unpopular, I praise your post Sally. It's nice to have some dissent on this site once in a while.
I think AdSense sucks too so I promote affiliate programs. My earnings per click for my affiliate programs are 10X my earnings with AdSense.
It's not as easy to make sales as it is to generate clicks, but it can be more lucrative if you know what you are doing.
|I think AdSense sucks too so I promote affiliate programs |
If you think AdSense sucks, and if you have an alternative that's earning you good money, why continue to use AdSense?
|It's not as easy to make sales as it is to generate clicks, but it can be more lucrative if you know what you are doing. |
IMHO, the real strength of AdSense is its ability to generate revenue from pages that don't work well with affiliate programs. Let's say you've got a site about Elbonian travel with affiliate links for Elbonian hotels, rental cars, and rail passes. One day you write an article for barge cruises in Elbonia. That article may not generate affiliate revenue, because people who go on barge cruises may not need hotels, rental cars, or rail passes. But with AdSense, the article will display ads for Elbonian barge cruises, allowing you to monetize pages that otherwise wouldn't have produced income.
In theory, why not place an adwords ad for a fairly obscure term, allow the content network and then have someone click your ad on an adsense site. You can then see what you were charged for the ad and how much you made. Trick is getting only 1 click.
I know the T.O.S. crazies are going to scream at me but I'm just mentioning that is the way to figure it out, I'm not going to do it and know I'd get kicked out for it if they found out that I did it.....
If you are not making tons of money on adsense you don't know what you are doing. I have personaly received a $20K check. I know people who make even more than that. The only problem is the only way to really make a lot of money is if your only goal is to make money on adsense. You can't have a site that is helpful or informaitve or is a labor of love. From what I here forums don't work. You can't just stick adsense on any site and make money. I have seen 2 sites with the same amount of page views and visitors one makes $1 a day or so and the other makes $500 a day. There are a bunch of factors that can make a site not make money with adsense. There are just as many ways that will help a site generate a ton of money. This is not an easy get rich quick program that any fool can do. It takes a lot of work to figure out how to make money. If it was easy everyone would be doing it.
As others have said your test was completly flawed. It has more holes than Sadam's rolls royce.
europeforvisitors makes a good point about putting adsense on pages that can't generate good affiliate income.
I use AdSense for 2 reasons:
1. To have multiple streams of income
2. In situations where there is not a viable affiliate program.
It really is all about the kind os site you have, and how well you can monetize the traffic. I tried affiliate marketing, only to get terrible ctr and a lousy 30$ from ebay, that I will probably never get cause its bellow the mailing minumum or something. My visitors click on adsense though, and true, the money I make pre click is low, but at least I see some real green comming in from time to time. Obviously, keywords on my site are extremelly un-competitive (low payout) and my target market has no cash (forget about affiliate), but I still get some money.
Also, you get wiser with time. I just managed to get some more serious revenue. Reading WW helps. Can't wait till mid-january, I'll be able to pay off that holydays visa bill ;)
From the other side:
I run content ads on campaigns for a few weeks - each... CTR appeared on par or higher... sales conversions however are seemingly nil 'always'.
Logically - a person clicking on a targetted ad 'anywhere' where the 'audience is targetted' should have a similar sales conversion rate [+/- %] as anywhere else that is targetted.
Moreover: fraudulent clicks might account for some discrepancy but would think no more or less prevailent than search... thus it doesn't make sound business and marketing sense to pay for something that doesn't seem to offer fair return.
That said - all campaign today get content ads 'turned off'.
It's a shame it doesn't work for you - I used to turn off content until Smart Pricing. Smart Pricing reduced the cost and made it profitable to use the content network again. However, some campaigns work better than others.
Personally, I think Google's mistargeting of ads has a lot more to do with my poorer converting ads.
|From what I hear forums don't work. |
There are Fed-Ex club AdSense users running AS ads on forums.
There are always exceptions. Besides we were talking about low click value not fed ex club. Yeah you can make a lot of money if you have 1 million visitors a day. What kind of epc does this person get TJ.
Sally, in the age of "smart pricing" how can you do a pure test? And how does your analysis line up with the #'s provided in Google's financials?
|What kind of epc does this person get TJ. |
Far more than a few cents.
Forums are just content - no different to any other content. That content will attract SE referrals, it's not just about the regulars.
AdSense performance will vary from site to site. To say that "AdSense doesn't work on forums" is, imo, too wide a sweeping statement.
AdSense won't work effectively on some forums. Nor will it on some websites.
|Logically - a person clicking on a targetted ad 'anywhere' where the 'audience is targetted' should have a similar sales conversion rate [+/- %] as anywhere else that is targetted. |
No, because audience behavior will vary with the topic and type of content--which is why Google's "smart pricing" gives a bigger advertiser discount on some types of content than on others.
On a travel-planning or product-review site, for example, conversion rates are likely to be high because visitors are actively researching ways to spend their money.
Well all I can say is that I'm starting to make just as much with my Adsense than I am with my affiliates. It's not quite there yet, but it seems as if Adsense revenues for me is climbing every month, and I DON'T HAVE TO DO ANYTHING. It's just there all the time. Paste it and forget it. Unlike my affiliates, which I love, because right now they make up the bulk of my income. But if Adsense keeps going like this...
|Forums are just content - no different to any other content. That content will attract SE referrals, it's not just about the regulars. |
Depends on the forum, the audience, and the topic. Traditionally, though, advertisers have viewed community content with skepticism. (I can remember when AOL had a nominal CPM of $65 in some of its search categories but maybe half that in forums and something like ten bucks in chat.)
It's great that Adsense works so well for many webmasters, but doesn't Sally have a right to point out that it's not working for us all? Why get offended and attack her for that?
If Adsense were really the be-all and end-all, wouldn't it be able to work well on all types of webpages?
Why can I make money from Fastclick or affiliate programs but Adsense can only offer me a few pennies a day?
One possiblity is that AdSense advertisers aren't creating ads that would work on a site like mine. However: (a) that isn't true because I've seen plenty that would work, and (b) if it were true, shouldn't AdSense be trying to lure all types of advertisers that would work on all types of sites?
I got so disgusted with Adsense that I started experimenting more with Fastclick's CPC ads, which I avoided before because I didn't expect a high click-through from my niche content site, and what do you know -- some of them do quite well on my site. Why is it that Fastclick can find ads that match my site content and appeal to my visitors, and Adsense can't?
Well, for one thing, Fastclick lets me identify my site's category for advertisers who want to target that category. Adsense doesn't even do that simple thing.
And when I do get clicks, why is the pay so low? I sell some quite expensive items through affiliate links, so I know my visitors have money and are buying. I do feel AdSense is treating me like a peon.
Adsense is clearly good for some sites, but it could be much, much, much better.
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