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Is Adsense going to eventually bust?
General concerns about Adsense
twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 4:55 pm on Apr 11, 2005 (gmt 0)

I am not referring to Adwords, becuase those can show up in search results for searches and that could be useful, just to Adsense.

1) I notice that most adsense are completely off-topic or unrelated anyway. To find this out though I typically would have to read them, I already ignore most advertising anyway, now I am supposed to not only not ignore it but take my time to read advertising? Even if it is doing well today, won't the average consumer get tired of reading advertisements at some point, especially when they are on every website on the internet almost.

2) For awhile now if I find a site that has good information or quality content I pay them back by clicking on their google ads. I don't even look at the page it goes to, but I figure it's like a virtual tip jar. They gave me some decent content and I tip them some change by clicking their google ad. I don't think I am the only one that does this either. Could similiar situations hurt publishers causing them to find alternatives.

3) Do people feel that the more adsense grows so will it's problems until the eventual point of collapse?

4) Didn't the PPC model already rise and fall once before? Does history tend to repeat itself or does everybody feel that it will be different this time?

5) I am not an economist but doesn't the model of supply and demand mean that at some point there will be so many websites with adsense that it will make it unprofitable? When a publisher has 500 websites wanting to run their ads won't they be able to pay less to each ad?

I am not trying to put down adsense, just have concerns. I currently do not use adsense but am trying to decide if it's worth moving all my content around to add adsense to my pages or just stick with regular affiliates. They may not be a quick buck but they seem, at the moment, a safer more permanent solution.

 

jetteroheller

WebmasterWorld Senior Member jetteroheller us a WebmasterWorld Top Contributor of All Time 5+ Year Member



 
Msg#: 6098 posted 5:00 pm on Apr 11, 2005 (gmt 0)

As I started June last year, I thought that EPC will decrease over time because of more and more publishers.

I think it's all within normal parameters.

As long as I can increase my income by more content against less EPC, it works for me.

ownerrim

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 5:01 pm on Apr 11, 2005 (gmt 0)

" currently do not use adsense but am trying to decide if it's worth moving all my content around to add adsense to my pages or just stick with regular affiliates."

Adsense is stable in every way except epc. In this regard, it is becoming quite infamous for the rollercoaster rides that publishers are regularly taken on. One minute you're making x, the next you're making .1x. Advertiser bids don't change THAT much. Could this be because of smart pricing? Perhaps, but why do you go from x to .1x and then back to x again, all within a week or two? There's no justifiable reason.

However, I think even the stability of the program itself is in doubt, simply because you can only yank around your publisher network when there is no viable alternative open to them. #*$!, adsonar, and all the rest don't count in that regard. When yahoo enters...everything could change. For better or worse is really the question.

jomaxx

WebmasterWorld Senior Member jomaxx us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 6098 posted 5:08 pm on Apr 11, 2005 (gmt 0)

Twist, GOOGLE ADS ARE NOT A TIP JAR, and believe me you aren't doing sites any favors by providing them with handful of fake clicks.

As for AdSense, maybe it'll work on your site, maybe not. Maybe revenues will remain steady in the future, maybe they'll fall. Ultimately nobody can answer these questions for you.

lammert

WebmasterWorld Senior Member lammert us a WebmasterWorld Top Contributor of All Time 5+ Year Member



 
Msg#: 6098 posted 5:12 pm on Apr 11, 2005 (gmt 0)

I am not an economist but doesn't the model of supply and demand mean that at some point there will be so many websites with adsense that it will make it unprofitable?

Yes, but here is where the AdSense system automatically stabilizes. If the costs-per-click for the advertisers goes down due to more publishers, the advertisers in that niche will see a higher ROI. This will push them to increase their budgets, and EPC will rise again for the publishers.

The model of supply and demand doesn't apply to this, because there is no fixed amount of advertisments. The amount of advertisements will grow as soon as the costs per advertisment decrease.

Sobriquet

5+ Year Member



 
Msg#: 6098 posted 5:17 pm on Apr 11, 2005 (gmt 0)

Twist, GOOGLE ADS ARE NOT A TIP JAR, and believe me you aren't doing sites any favors by providing them with handful of fake clicks.

I agree 100%.

Think from a layman point of view, and not from a Adsense user point of view.

Google AdSense actualy provides value to surfers by letting them have a gateway to more sites.

novice

10+ Year Member



 
Msg#: 6098 posted 5:21 pm on Apr 11, 2005 (gmt 0)

"5) I am not an economist but doesn't the model of supply and demand mean that at some point there will be so many websites with adsense that it will make it unprofitable? When a publisher has 500 websites wanting to run their ads won't they be able to pay less to each ad?"

Based on Google's projections they hope to add 2,000 new advertisers every week. That will help support the supply.

As for the demand, just because a publisher starts 500 websites that does not mean that they will generate a massive amount of traffic. Setting up a web site is one thing, getting traffic is another.

alika

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 5:31 pm on Apr 11, 2005 (gmt 0)

More than EPC, another factor to consider is if and when text ad blindness starts to creep in. Like the way of the banner whose CPM rose to statospheric heights at the start, then plummeted to the bottom a few years later. The more text ads the user sees, the greater the likelihood that they will learn to eventually ignore anything that has "Ads by Google" label on it - whether the publisher has camouflaged it to merge with the content or used eye catching colors.

Until then ... get on the bandwagon and enjoy it while it lasts. Then it's on to the next big thing, whatever that may be.

jretzer

5+ Year Member



 
Msg#: 6098 posted 5:33 pm on Apr 11, 2005 (gmt 0)

I *am* an economist and you haven't followed the supply and demand thing all the way through.

If the number of publishers outstrips the number of advertisers, then some (many?) of those publishers will see nothing but non-paying public service ads (or, they will get a lot of those 2cent clicks like I have). This will drive those publishers to seek other forms of revenue. So the number of publishers will fall back to equilibrium.

It also works on the other side. If advertisers far outstrip publishers, then that will increase payments to publishers. This will drive others to enter the market, and once more, things will fall back to equilibrium.

This effect will only become more evident as other google-like ad bureaus come on line.

cyberair

10+ Year Member



 
Msg#: 6098 posted 8:27 pm on Apr 11, 2005 (gmt 0)

Supply and demand can't be determined completely at this point, because this is an emerging market where many competitors, advertisers, and publishers are coming in and out. In order to have a more accurate view of the demand and supply, we have to wait more on the market to be more stable and have more consistent ad inventory (YPN).

In any case, it is unlikely that online ad revenue will dry up. As ROI and other metrics get more reliable on the net, more offline ad revenue will move to the online world. Some of that to centextual, some to graphical, and some will go to other forms of online advertisement.

Therefore, we have a high confidence level that online ad spending will increase, traffic will increase as well.

Will Adsense go bust? Maybe.

Will contextual advertising and advertising revenue programs for small publishers disappear? No.

twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 9:32 pm on Apr 11, 2005 (gmt 0)

In order to have a more accurate view of the demand and supply, we have to wait more on the market to be more stable and have more consistent ad inventory

So basically, when yahoo and all the rest get on the band wagon the pay-per-click market will turn into a commodity and the prices will average out.

another factor to consider is if and when text ad blindness starts to creep in.

If google is adding 2000 publishers a week which will in turn convert more and more websites to adwords, and then yahoo starts! Yes, it just doesn't seem like it will be long before it grows tiresome trying to seperate text ads from text content on peoples pages. Burnout seems inevitable.

I'm just going to wait and see. Thanks for the replies everybody.

Never_again

10+ Year Member



 
Msg#: 6098 posted 9:43 pm on Apr 11, 2005 (gmt 0)

For awhile now if I find a site that has good information or quality content I pay them back by clicking on their google ads.

Keep doing this and you will almost certainly ensure that AdSense does go bust.

I am not an economist but doesn't the model of supply and demand mean that at some point there will be so many websites with adsense that it will make it unprofitable?

If AdSense starts to become unprofitable then you would expect websites to start replacing it with other more profitable income generators. As a result, fewer websites will display AdSense which means less supply. Guess what happens when the supply of a good or service is reduced? Right, and in the case of AdSense it also will then become profitable. That is how the supply and demand model works it is self regulating.

Nathan

10+ Year Member



 
Msg#: 6098 posted 9:50 pm on Apr 11, 2005 (gmt 0)

I'm surprised there isn't more of an outrage over this guy thinking Google Adsense is a freakin' tip jar. When I read that my blood pressure started to rise.

I advertise on Google AdWords. When you click on Google ads you're taking money away from small business and people like me. You're not taking money from a huge corporation called "Google". You're a theif... you might as well become a shoplifter or a pick pocket. Just because you're hiding behind your computer screen doesn't mean your crimes aren't hurting people.

Never_again

10+ Year Member



 
Msg#: 6098 posted 10:02 pm on Apr 11, 2005 (gmt 0)

You're a theif... you might as well become a shoplifter or a pick pocket. Just because you're hiding behind your computer screen doesn't mean your crimes aren't hurting people.

Well put!

Crustov

10+ Year Member



 
Msg#: 6098 posted 10:26 pm on Apr 11, 2005 (gmt 0)

Nathan, I think there will always be a good amount of non-converting clicks for various reasons and it is something that needs to be budgeted for. Whether the ad is clicked by accident or whether it is being used as a tip jar, it is just a reality of the PPC world.

Alika, as far as adblindeness goes, I don't think people will become completely blind to adsense ads. For the most part, adsense ads are high quality. They are relevent and in many cases add value to the user.

It is in the advertisers best interest to accurately describe their site or service, because it will increase their conversion rate. And as long as ads are being placed where they serve the user, I don't beleive that the rate of adsenseblindness will increase to levels where they will destroy the adsense program.

It is only if the user is repeatedly betrayed that he will begin to ignore this type of advertising. Which doesn't seem to be happening yet.

Nathan

10+ Year Member



 
Msg#: 6098 posted 10:32 pm on Apr 11, 2005 (gmt 0)

Nathan, I think there will always be a good amount of non-converting clicks for various reasons and it is something that needs to be budgeted for.

WOW! Guess what? Shoplifters say the same exact thing! I should know, I've worked in retail. They say "Well you should just expect it to happen and adjust your prices accordingly"

People who steal from Google AdWords sponsors are petty thieves.

lammert

WebmasterWorld Senior Member lammert us a WebmasterWorld Top Contributor of All Time 5+ Year Member



 
Msg#: 6098 posted 10:42 pm on Apr 11, 2005 (gmt 0)

People who steal from Google AdWords sponsors are petty thieves.

I agree with you. The only thing is that in this case the thief is not cashing the money. I think the behaviour as described by twist does not help the publisher at all, because these are clicks that do not convert which may trigger smart pricing. So the effect could be that although the publisher gets one paying click, subsequent clicks will be worth less because of smart pricing, having a negative effect on the total earnings of the publisher.

So clicking as suggested by twist is not in the benefit of the advertiser, but it does also not help the publisher.

bbcarter

5+ Year Member



 
Msg#: 6098 posted 10:44 pm on Apr 11, 2005 (gmt 0)

I'm wondering if AdSense is broken-

Since the last rankings change, my traffic went down for sure, but the % of pageviews that become impressions has dipped even more significantly.

My impressions were 50% of my server pageviews. Several email exchanges with AdSense staff didn't resolve it.

Now it's down to 33%. I'm seriously considering another revenue model.

My only theory is that they are reviewing a large portion of my clicks- in the past they credited me for 'other' which doesn't tell you much, but I believe it was clicks that were under review.

This would mean that AdWords advertisers in our niche would lose thousands of quality impressions per day- because G can't get it together?

Quite frankly, we do such a good job of providing the kind of content that would provide a warm clicking prospect (without violating ToS), and we put up so much new content, that I think we must have set off some flags.

jomaxx

WebmasterWorld Senior Member jomaxx us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 6098 posted 10:51 pm on Apr 11, 2005 (gmt 0)

bbcarter: My guess is that the number of human referrals went down, but that the number of spidered pages (which likely show up in your logs but do not generate an AdSense impression) has remained more or less unchanged.

bbcarter

5+ Year Member



 
Msg#: 6098 posted 10:53 pm on Apr 11, 2005 (gmt 0)

this is probably off topic to continue too far on, but wouldn't the amount of spider activity have to increase and human referrals dip significantly, almost exactly, and at the same time, for your theory to be correct? If so, that seems unlikely.

jomaxx

WebmasterWorld Senior Member jomaxx us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 6098 posted 11:04 pm on Apr 11, 2005 (gmt 0)

No. You said SE referrals dropped significantly. Therefore if spidering remains at about the same level, it becomes a much greater proportion of overall server activity, which can create the effect you described.

bbcarter

5+ Year Member



 
Msg#: 6098 posted 12:30 am on Apr 12, 2005 (gmt 0)

Difficult to verify because I changed servers and I'm comparing apples to oranges in 'agents'- but in Feb 2005, I had roughly 38,000 spider hits versus 1,680,000 browser hits, so are you suggesting a scenario wherein my browser hits go down to 38,000?

europeforvisitors



 
Msg#: 6098 posted 3:19 am on Apr 12, 2005 (gmt 0)

I notice that most adsense are completely off-topic or unrelated anyway.

Depends on the site and the topic. AdSense works best on special-interest sites. On my own site, targeting has been quite good, overall, and it's been getting even better over the last few months.

Even if it is doing well today, won't the average consumer get tired of reading advertisements at some point.

Why should "ad blindness" be any more of a problem on the Web than it is in newspapers, magazines, radio, or TV?

If the ads are relevant to what users are looking for, they're an asset, not an annoyance--which is why trade and enthusiast magazines are able to attract and retain readers and advertisers month after month, year after year.

twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 7:07 am on Apr 12, 2005 (gmt 0)

When you click on Google ads you're taking money away from small business and people like me. You're not taking money from a huge corporation called "Google". You're a theif... you might as well become a shoplifter or a pick pocket. Just because you're hiding behind your computer screen doesn't mean your crimes aren't hurting people.

Thank you for the lesson in ethics. Since you pay google money for their adwords program maybe you could contact them about their ethics?

Type "tracfone" or "virgin mobile" into a google search. The very first clickable link is a adword for that company, directly below it is the actual link. People click on the first link and guess what, google makes money. You seriously think google can't check the first serp result and see that it matches their adwords result? They are, according to your definition, thieves and trying to steal money from their own adwords customers, and you support them. Glass houses.

If google's adsense model has a flaw you should talk to them not waste your time complaining to me about it. Even if you changed my mind it doesn't make the problem disappear, does it?

Nathan

10+ Year Member



 
Msg#: 6098 posted 7:19 am on Apr 12, 2005 (gmt 0)

They are, according to your definition, thieves and trying to steal money from their own adwords customers, and you support them. Glass houses.

According to my deffinition how exactly? You make absolutely no sense at all.

If people are searching for Tracfone and they click on the adsense ad, they are 100% targeted! When YOU click AdSense links blindly (you said you don't even care where the link goes) you're just ripping off the advertiser and wasting their money.

And Tracfone controls when their ad shows up! If they don't want their ad to show up when people search for "Tracfone" they can just exclude that term!

If google's adsense model has a flaw you should talk to them not waste your time complaining to me about it.

Translation: "Oh if you don't want me to steal stuff you should have better security!"

It's almost (or completely) impossible for Google to figure out WHY someone clicked a link in this situation. They don't know what a specific person's intentions are.

Even if you changed my mind it doesn't make the problem disappear, does it?

Translation: "Why shouldn't I steal? Lots of people do it!"

Talk about making excuses! You sound exactly like a theif! And yes, if I convince you and other people reading this right now it DOES make a difference.

[edited by: Nathan at 7:24 am (utc) on April 12, 2005]

twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 7:21 am on Apr 12, 2005 (gmt 0)

Depends on the site and the topic. AdSense works best on special-interest sites. On my own site, targeting has been quite good, overall, and it's been getting even better over the last few months.

No specifics but I found a website tonight about "<city>, <state>". It was the top of the serps for "<city>, <state>"

It had adsense and I was amazed that people from this small city had adword accounts. So I clicked on them because they seemed to be relevant. No indication that they weren't. They took me to a website for <city>,<different state>. All 5 of the adwords went to the same city name in an entirely different state. It clearly stated at the top of the page and was restated over and over throughout the page that city and that state. That can't be good for those publishers.

bbcarter

5+ Year Member



 
Msg#: 6098 posted 7:34 am on Apr 12, 2005 (gmt 0)

I sent AdSense another email about my odd declining impressions % - got a form email back about CPM etc. (even tho I was concerned about clickthru, not CPM- evidently that's been a concern for others)- thought you might be interested (below)-

and btw I'm becoming quite certain I need a mix of revenue sources, just like you need a mix of traffic sources... because AdSense seems to have NoSense ;-)

Hello,

Thank you for your email. I understand you are concerned with a decrease
in the effective CPM associated with the Google ads you're serving through
AdSense.

We're constantly analyzing data across our network against a variety of
factors. If our data shows that a click is less likely to turn into
business results (e.g. online sale, registration, phone call, or
newsletter sign up), we reduce the price that an advertiser will pay for
that click.

We take into account many factors such as what keywords or concepts
triggered the ad as well as the type of site on which the ad was served.
For example, a click on an ad for digital cameras on a web page about
photography tips may be worth less than a click on the same ad appearing
next to a review of digital cameras.

Please also understand that your earnings will depend on a significant
number of factors, such as your users' clickthrough selections, advertiser
spending campaign trends, and the types of ads being served to your pages.

At the same time, we're improving the targeting to content pages, to show
ads that are even more relevant than before. Even when a page contains
multiple topics, we'll be able to know which topic is more relevant to
your users. As a result, you'll notice an increase in your clickthrough
rate.

These two improvements to our advertising program are intended to increase
the long-term revenue potential of AdSense publishers, by driving rapid
growth to our advertiser base, and by providing more relevant ads and a
better user experience. Your AdSense reports will give you a good idea of
the effect of these changes over time.

I also understand that your clickthrough rate has dropped as well. As our
advertiser base is constantly changing, different ads will appear. I
reviewed your site and it appears to be showing relevant ads at this time.
Your users may also be affected by ad blindness. To decrease ad blindness,
you may want to rotate your color palettes to keep the ad appearance fresh
to repeat visitors.

Please feel free to reply to this email if I can be of any further
assistance.

Sincerely,

The Google AdSense Team

twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 7:44 am on Apr 12, 2005 (gmt 0)

Talk about making excuses! You sound exactly like a theif! And yes, if I convince you and other people reading this right now it DOES make a difference.

Can't argue with that logic, problem solved ;)

People's children die of starvation everyday. Posting a request to end world hunger on a niche message board on the web isn't going to make that problem go away.

My local walmart has 17 security cameras on the front side of the store alone. Walmart is actively trying to solve their theft problem in their B&M environment. A company can't just sit around expecting problems to go away. They either make the problems go away or the company goes away. It doesn't sound fair and balanced, but neither is the fact that people in other parts of the world starve to death everyday.

Nathan

10+ Year Member



 
Msg#: 6098 posted 7:46 am on Apr 12, 2005 (gmt 0)

That doesn't change the fact that people who steal from Walmart are theives.

You sir, are a theif. End of story

And comparing world hunger to Google Adsense? Riiiight.

[edited by: Nathan at 7:47 am (utc) on April 12, 2005]

twist

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 6098 posted 7:47 am on Apr 12, 2005 (gmt 0)

Your users may also be affected by ad blindness. To decrease ad blindness,
you may want to rotate your color palettes to keep the ad appearance fresh
to repeat visitors.

Talk about writing on the wall.

This 37 message thread spans 2 pages: 37 ( [1] 2 > >
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