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Is The Global Crisis a Threat to AdSense Publishers?
Knowledge seeker




msg:3832082
 9:45 am on Jan 22, 2009 (gmt 0)

As we all know that world rich economy is in downfall i.e USA, UK, and other's european countries, what will it effects on the google adword advertiser, as they will spend very little on the online advertising, and its consequent impact on the google adsense publisher? will adsense business is going to be finish in near future? do you see world depression on your adsense dailty earning?

 

dibbern2




msg:3834124
 5:50 am on Jan 25, 2009 (gmt 0)

Getting back to the OP: is the current economic crisis a threat? Of course it is.

But threats are only possibilities: they might happen, and then, they might not. We don't know how our markets are going to fare in the coming year, and there is no one in this group who has any more than a guestimate or a hunch.

The AdSense business model has never experienced a world recession of the kind we're in now, so there's no prior data to use as a compass. A safe bet is that about 50% of the opinions here on this subject are correct, but which 50%?

zett




msg:3834133
 7:06 am on Jan 25, 2009 (gmt 0)

I didn't say that Google keeps 5% of AdSense revenue, I said the amount Google keeps accounts for only 5% of total revenue.

Finally, after all those years debating whether this amount is the Adsense revenue share, this is a good definition. Still, it hast to be said that even a payout of X% to all Adsense publishers does not mean that EACH publisher gets X%. There may be sweetheart deals that get 100% (or maybe even more).

I wasn't talking about averages

Sure you were. As we don't know how many publishers there are and how the payout is actually calculated, we can only talk about totals. This lack of personalized analysis (which can not be performed due to lack of data) only allows to talk about impact for the average publisher. Too bad, that there are so few "average publishers" around these days. ;-)

Seb7




msg:3834199
 1:48 pm on Jan 25, 2009 (gmt 0)

Despite everything, I personally think adsense wont drop and that online businesses will continue to grow.

Infact, it could be that GDP is down because a lot of the worlds money is now flowing uncounted through the web.

-and we my might not actually be in a phyical recession after all. my bold statement! It does seem to be the service industry countries which seems to be suffering.

[edited by: Seb7 at 2:05 pm (utc) on Jan. 25, 2009]

nickreynolds




msg:3834226
 3:05 pm on Jan 25, 2009 (gmt 0)

I'm still on a gradual upward curve - nothing to panic about yet. Some sites are up a bit, some are down. My main niche has a niche within it - training. I've seen a massive upsurge in visitors (presumably people who think they may lose their jobs) and of course it's a great time for training companies so they are increasing their spend.

wolfadeus




msg:3834231
 3:20 pm on Jan 25, 2009 (gmt 0)

In terms of eCPM, I am down by approximately 50% compared to last year; this is partly due to reduced AdSense revenue, partly due to decreased direct spending on banners. And yes, I do blame the credit crunch and economic crisis for it - especially weak dollar and pound harm my websites, alongside with increased airfares and general pessimism that makes people postpone or cancel their vacations.

signor_john




msg:3834232
 3:21 pm on Jan 25, 2009 (gmt 0)

Internet advertising has been on a decline for a while now

No, it hasn't. It's been growing, and all of the projections that I've seen suggest continued growth in 2009. The rate of growth is expected to decline (as this forecast [reuters.com] from Wachovia Securities indicates), but most analysts are still predicting growth.

That doesn't mean some, many, or most AdSense publishers won't be hurt by the "global crisis," of course. Many will be, and perhaps a majority will be. But for any individual AdSense publisher, the state of the world economy is just one of the factors that determine AdSense revenue. Some publishers were bleeding badly long before there were any hints of a recession, and several of this forum's members have reported record revenues in the last month or two, at a time when companies are laying off workers, retail sales are slumping, and governments are talking about bailouts. As for MySpace and Facebook, they're two examples of sites that aren't good candidates for AdSense: They aren't niche sites, their audiences aren't researching purchases, and their ad revenues are derived from huge volumes of low-quality traffic.

htnmmo




msg:3834234
 3:25 pm on Jan 25, 2009 (gmt 0)

There may be sweetheart deals that get 100% (or maybe even more).

I wouldn't be surprised if there were. I don't think they started out that way, but the changes in the market have made it so. Google says they have some contracts that don't get paid per click or per impression, they have guaranteed payouts negotiated in their contracts. Like the $900 million deal for MySpace to use Google search.

When they first signed the contract their predictions for revenue growth might have made it attractive, but as things changed, they may now be paying out more than their getting.

Averages/totals, it's still important. Sure someone might be able to do better or worse, my point is for the past few quarters, revenue growth has pretty much been non-existent across the entire AdSense publisher network. Nobody should expect things to be as easy as they were in the past when quarterly revenue was in the double digit range. Everyday more publishers get added trying to grab their slice of a pie that isn't really growing.

If you think you're going to get $30 million in VC money to start a website that relies solely AdSense as a revenue source, good luck.

signor_john




msg:3834259
 4:39 pm on Jan 25, 2009 (gmt 0)

Everyday more publishers get added trying to grab their slice of a pie that isn't really growing.

What's really important is that the method of slicing the pie has changed since the early days of the network, when anyone could slap AdSense code on any kind of site and advertisers (or at least advertisers who weren't smart enough to opt out of the content network) paid full retail for junk clicks. Some of the changes that we've seen include:

- Smart pricing (advertiser discounts for clicks that aren't expected to convert at a high rate)

- Separate bidding for the search and content networks.

- At least one major change in how clicks are counted.

- An unlimited domain filter for advertisers.

- Placement targeting (a.k.a. site targeting) for contextual ads.

- Occasional purges of publishers who fit certain profiles (such as click arbitrageurs).

These are just the known changes that have hurt some publishers while benefiting others. There may be unannounced changes, too, that could be affecting ad allocation, the compensation formula, or both. We just don't know. What we do know is that AdSense has evolved from the anything-goes, advertiser-take-potluck ad network that it was five years ago. The spread between the "haves" and the "have-nots" will continue to increase, and--as ronburk so eloquently suggested in another recent thread--AdSense publishers will need to develop real publishing skills if they want to succeed with AdSense. In the AdSense network, as in Web advertising overall, the quality of content and audience is becoming increasingly important (as it always has been in the offline advertising world).

OnlyToday




msg:3834265
 5:05 pm on Jan 25, 2009 (gmt 0)

Black boxes are inherently prone to corruption. In times of shrinking revenues corruption wins.

maximillianos




msg:3834266
 5:07 pm on Jan 25, 2009 (gmt 0)

We have had to work harder for our Adsense money this year, but mostly due to changes like the clickable area and ever improving Adwords features for more control over campaigns.

That said, we are looking at having our best month ever in 5 years this month. And it is not our best month traffic wise.

On the otherhand it is being balanced out by our lack luster months of affiliate sales in certain niches that are being heavily influenced by the market (ie - financial products).

In the end our overall net is pretty much stayed constant.

ember




msg:3834314
 8:06 pm on Jan 25, 2009 (gmt 0)

Our numbers have been climbing, and the niche we're doing the best in is one of the ones being hit hardest by the recession. I can only attribute it to advertisers being desperate for customers. Will it last? Who knows, but while I expected revenue to tank six months ago, it hasn't happened. And we too are still being approached by independent advertisers.

potentialgeek




msg:3834343
 9:18 pm on Jan 25, 2009 (gmt 0)

A threat? Of course. But it depends how much advertisers were living in a dream world, borrowing money to pay their advertising bills and/or other bills.

One big advantage of businesses using online advertising v. other kinds is the ability to monitor results and see ROI. That has to feel safer.

Google just released its advertising revenue data for the quarter. Here's the graph.

[i.i.com.com...]

p/g

nomis5




msg:3834349
 9:39 pm on Jan 25, 2009 (gmt 0)

The downturn is not going to help matters, that's the only definite fact.

So asking the question "Is The Global Crisis a Threat to AdSense Publishers?" begs the obvious next question, how are you going to cope with the global crisis?

1. Expand your horizons to attract more potential advertisers?

2. Concentrate on subjects which may do well in the global crisis?

3. Ignore the crisis and concentrate on providing quality content?

4. Look for more one off quick earning opportunities?

There IS a crisis, no debate about that. Where are you heading for to minimise its impact?

htnmmo




msg:3834355
 10:06 pm on Jan 25, 2009 (gmt 0)

But it depends how much advertisers were living in a dream world, borrowing money to pay their advertising bills and/or other bills.

It's not that advertisers were borrowing money. It's that consumers are going to be spending less.

A lot of people's wealth vanished. Not just in real estate. If you had an investment or retirement account, the value of that likely fell dramatically. Lending is harder to get so that gives another reason for people to save more and spend less. Throw in rising unemployment too and things get worse.

Less consumer spending means advertising budgets need to do more with less to keep a good ROI.

One surprise was that the automotive vertical still did well in AdSense. Not sure how long that will last. The bailout probably helped.

incrediBILL




msg:3834381
 11:11 pm on Jan 25, 2009 (gmt 0)

You can either be a victim of circumstances or you can control your own destiny.

When AdSense took a tumble a few months ago the major issue I saw was CTR, which has never happened in the past.

What a CTR tumble means could be one of several things:

1) the ads are all crap
2) the consumers aren't buying
3) you need more traffic to make up the difference

So I went on the offensive and whacked all the crap ads in AdSense and blocked all the DoubleClick image ads (off topic junk) which rallied the click through rate once more.

Then, I did something unprecedented for my site and ran a massive sale for 10 days giving direct advertisers a deep discount and ad sales absolutely boomed. They're looking for a deal, you just have to find the sweet spot.

Now working on some additional ways to provide more value to my direct advertisers and members, which will leave me in control of the site earnings, not at the whimsy of AdSense.

Last but not least, it's time to re-evaluate the SEO for the site as it's always an evolving process.

Checklist of action items:

a) Do you rank for the terms in Google's auto-suggest feature?
b) Is your site squeaky clean in Google's webmaster tools?
c) Have you checked AdWords and Google trends for keywords you rank for?
d) Did you compare your competitors traffic and SERP rankings to yours?

Lot's of simple common sense things will help you weather the storm if you're proactive.

[edited by: incrediBILL at 11:18 pm (utc) on Jan. 25, 2009]

2clean




msg:3834558
 8:30 am on Jan 26, 2009 (gmt 0)

Online marketing is one of the few completley measurable and trackbackable-to-source forms of advertising. Therefore while there may be an overall cooling, if your a clever seller you should be able to actually make more in a downturn.

davidof




msg:3834563
 8:55 am on Jan 26, 2009 (gmt 0)

I'm getting calls from Adwords users to help them optimize their campaigns. As another poster said above the days of setting a budget and selecting some keywords are gone for many advertisers looking for ROI.

slartythefirst




msg:3834583
 9:49 am on Jan 26, 2009 (gmt 0)

The use of single line ads is the greatest threat to Adsense earnings. As an Adwords user, I opted out of the content network because it was seriously damaging my CTR and causing me to pay more. The single line ad is not much good for surfers, as they only see the ad title. So they click it less, my click through rate goes down and the cost per click goes up. More and more Adwords users are realising this, so it will reach a point where the majority of ads in the content network are for weight loss or get rich quick schemes.

tabish




msg:3834738
 3:07 pm on Jan 26, 2009 (gmt 0)

It is really bad for us. I don't know about others. but for example, one of my friend (adsense publisher) revealed me, that if he was getting around US$500 per day from few of his websites, NOW he has started getting US$25 only.

From 500 to 25.. it's really bad.. isn't it?

It's really getting bad to worst now..

signor_john




msg:3834739
 3:08 pm on Jan 26, 2009 (gmt 0)

Online marketing is one of the few completley measurable and trackbackable-to-source forms of advertising.

That's true of online direct-response advertising, such as contextual AdSense text ads. It's less true of display advertising (which is where a lot of big advertisers are spending the majority of their online budgets), although research tools are improving.

powerstar




msg:3835314
 3:08 am on Jan 27, 2009 (gmt 0)


Online marketing is one of the few completley measurable and trackbackable-to-source forms of advertising.

That's true of online direct-response advertising, such as contextual AdSense text ads. It's less true of display advertising (which is where a lot of big advertisers are spending the majority of their online budgets), although research tools are improving.

how is it different? a click is a click if its coming from banner ad or a text link. Everything is measure by a click

signor_john




msg:3835368
 6:18 am on Jan 27, 2009 (gmt 0)

how is it different? a click is a click if its coming from banner ad or a text link. Everything is measure by a click

Nope. Most display ads are not direct-response ads. Their purpose is to build awareness, communicate a brand message, give "lift" to other marketing efforts, support distributors and dealers, etc. A good example would be display ads for a cruise line. The cruise line builds public awareness and demand through display ads, while travel agents (who sell virtually all cruises) use AdWords, AdSense, direct mail, telemarketing, and other direct-response techniques to generate inquiries and sales.

graeme_p




msg:3835512
 11:12 am on Jan 27, 2009 (gmt 0)

Advertising per se is definitely cyclical. There will be a lot less spent on advertising in 2009 than in 2008.

There is a big "but": the web is a comparatively cheap place to advertise. If I compare my website to a print magazine with comparable reach in my niche, it is much, much cheaper. We have a very good chance than advertisers will cut back on expensive media (TV, magazines, national newspapers) first, so we will be relatively sheltered.

potentialgeek




msg:3835688
 3:05 pm on Jan 27, 2009 (gmt 0)

My biggest advertiser for a long time dropped out yesterday, but there was barely a dent, if any, to revenue. It had used a very aggressive ad campaign which generated over 2,000,000 new members (most all via AdWords). Either it dropped out of the Content Network and Search Network, or it got banned. Perhaps it was just a Campaign Suspension. It had been the top advertiser (by ad position) for over a year.

p/g

frontpage




msg:3835733
 4:10 pm on Jan 27, 2009 (gmt 0)

Example 3: One-third of chief marketing officers (CMOs) at leading US retailers said that their marketing and advertising budgets have been reduced this season, according to new research.

Where'd you get this from?

Google is your friend.

[marketwatch.com...]

signor_john




msg:3836096
 11:37 pm on Jan 27, 2009 (gmt 0)

OK, let's look at some real numbers from companies that track the advertising and publishing industries:

A January 26th ADVERTISING AGE article titled 'Online CPM Ads Take Tumble [adage.com] has some sobering statistics. According to the article, "Cost-per-thousand ad impressions for online publishers are generally off about 20%," and "where publishers used to unload 60% of their inventory, some are now able to sell only 30%." The article goes on to say that ad-network CPMS are dropping (in some cases, by 50 per cent year over year). In August, the Internet Advertising Bureau and co-sponsored a study that showed "average CPMs on ad networks ranged from 60 cents to $1.10."

Mind you, these numbers are averages; some publishers and vertical ad networks are doing far, far better than the IAB numbers would suggest. But others are doing worse: The PubMatic Q4 AdPrice Index study [pubmatic.com] suggests that the average online CPM in the fourth quarter of 2008 had fallen to 26 cents (from 50 cents in 4Q 2007), for a 48 percent drop in one year. (The study was of 5,000+ small, medium, and large publishers, mostly in the U.S.) Clearly, these are not great times for the advertising business, and it's only reasonable to expect that many--and possibly most--AdSense publishers will feel the impact of smaller budgets and lower real or effective CPMs.

guru5571




msg:3836286
 8:04 am on Jan 28, 2009 (gmt 0)

No it's not. First, you misinterpreted what I said. I didn't say that Google keeps 5% of AdSense revenue, I said the amount Google keeps accounts for only 5% of total revenue.

Basically. (AdSense Revenue - Paid To Publishers) / (AdSense Revenue + Google Sites Ad Revenue) = 5%

As for the 35-40%, Google keeps a lot less than that. Last quarter it was only about 13%, the quarter before that it was 11%. Highest reported quarter was 23% in 4Q04.

If you check Google's SEC filings it's in there.

I didn't misinterpret you. I didn't say that Google keeps 5% of AdSense revenue either.

Your methods are flawed and wrong for calculating what most publishers get. You can't just look at the SEC filing for TAC. AOL, Myspace and other big media companies are cooked into those numbers. They get deals that pay Google like they are just another ad agency. So you will never be able to glean publisher rates from SEC filings.

What else is Google including in overall Traffic acquisition cost? Uhh... we don't really know. Seems like a great place for corporate accounting to shoehorn lots of expenses. Nice way to keep things looking pretty.

The percentages I posted are what I roughly recall mentioned on that Federated Media conference call as the standard rate that they were taking. So 13% for Google is a pretty ridiculous number for most of us, more likely all of us here.

Google's filings are as good as toilet paper for gaining any insight into what percentages publishers get.

Highest reported quarter was 23% in 4Q04

Why in the world would Google voluntarily drop their take from 23% to 13% when YPN fizzled and all the other ad networks take 20%-50% for most publishers?

Obviously they didn't. They just refined their accounting methods. Corporate accounting isn't cut and dried number crunching. It's an art of gilded flourishes and perspective not to mention a little sleight of hand.

hendricius




msg:3844825
 3:34 am on Feb 8, 2009 (gmt 0)

The problem is that with less advertisers the ads are getting less relevant. Less relevant ads means less money per click and consequently less earnings for the publisher.

[edited by: martinibuster at 6:22 am (utc) on Feb. 8, 2009]
[edit reason] Removed URL. [/edit]

Atomic




msg:3844858
 7:23 am on Feb 8, 2009 (gmt 0)

The global crisis may be a threat to many publishers but, despite (or perhaps because of when it comes to my niche) all the bad news, my year over year earnings have increased almost 200% this month. However, only a week has gone by and last month we saw only a 13% YoY increase so who knows how February will play out.

signor_john




msg:3844868
 8:05 am on Feb 8, 2009 (gmt 0)

The problem is that with less advertisers the ads are getting less relevant. Less relevant ads means less money per click and consequently less earnings for the publisher.

That's the kind of generalization that doesn't hold up under scrutiny. Why? Because there may be fewer advertisers for some keywords and more advertisers for others, and the growth in publisher page inventory for some keywords will be greater for some keywords than for others.

One recent study suggested that advertisers are competing less for obvious "money" keywords and shifting more dollars toward "long-tail" keypharses. If that's true, it means that publishers who target money keywords may be losing out, but publishers who attract long-tail ads may be profiting at the expense of the money-keyword crowd.

For what it's worth, I've seen no decline in ad relevancy, and my site's average EPC was considerably higher in late 2008 than in late 2007. January was also quite strong. EPC has been somewhat weaker in February, but that probably has more to do with the economy than with anything else. It certainly isn't related to ad targeting.

zett




msg:3844871
 8:28 am on Feb 8, 2009 (gmt 0)

my site's average EPC was considerably higher in late 2008 than in late 2007. January was also quite strong. EPC has been somewhat weaker in February

On Y/Y comparison, I do see the same. EPC began to rise significantly (on a Y/Y basis) in July. This lasted until December. January was flat, and February sees a decline.

I can not see any rationale behind the huge daily EPC (and eCPM) volatility. What I *do* see though, is that long-term average EPC is flat down to fractions of a Cent. In summer 2008 I entered this EPC, and never left it. Huge daily variations, no change in long term average. Summer vacations, server crashes, financial crisis, economical crisis, changing advertisers, Christmas - nothing impacted long-term EPC. It's rock-solid. And no, it has not always been like this.

I am under the impression that EPC is pre-determined. It's hard to believe that all the economical turmoil would not affect the bidding behaviour of advertisers. (We're not seeing this in the real world.) So, I believe that "sumthin's fishy".

It certainly isn't related to ad targeting.

That's the kind of generalization...

This 69 message thread spans 3 pages: < < 69 ( 1 [2] 3 > >
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