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Your AdSense Earnings Less in 2012 than in 2003?
martinibuster




msg:4490433
 2:31 pm on Sep 1, 2012 (gmt 0)

I made more in August 2003 than I did in August 2012!


Someone posted the above statement in the August 2012 AdSense Earnings Observations [webmasterworld.com] thread. There is a lot going on in that statement. The question to think about is, what got us to the point where some are making less today than they were nine years ago? It's intellectually lazy to scoff that web publishers are making less in 2012 than in 2003 because of the economy. This is how we miss the truth, by scoffing at the obvious without looking at what's happening deep down. Number one, there are billions more ad dollars being spent in 2012 than there were in 2003. On page 7 of this report of online ad spending compiled by the Internet Advertising Bureau [iab.net](IAB), their measurements of online spending in the U.S. show that in 2003 there was just $7.27 billion spent on Internet advertising. By 2010 that figure had risen by almost 400% to $26 billion dollars. By other measures, global 2011 advertising spending grew by almost 17% over 2010. IAC had a great second quarter, whose earnings rose by 40% [hollywoodreporter.com]. Google had a great 2nd quarter, too. Google's paid clicks increased by 42% [zdnet.com]. How does that compare to your paid clicks? It's not the economy. Clearly the world has changed, but not in the way you might suppose. The world has changed to the extent that more money is being spent on online advertising today than at any other time. So what is going on?

A major problem with the AdSense program is that it is poorly promoted. Now ask yourself, how does Google benefit from an AdSense program that underperforms? Let's count the ways:

1. AdSense doesn't siphon off ad dollars from the AdWords program
Google makes more money from the AdWords program. Make no mistake, the AdSense program competes for limited advertising money with the AdWords program. A weak AdSense program keeps more money in Google's pocket.

2. AdSense is good for Google because it's bad for affiliate programs
Think about it. Why would Google create a competitor against affiliate programs but not promote it to it's advertising clients? Because the AdSense program increases advertising inventory at the expense of affiliate companies. Affiliate programs were competitors for advertising dollars that Google would rather see flow to them. But competitors compete with advertising inventory. AdSense gave Google a way to lock up advertising inventory and keep it from their competitors. By not promoting their AdSense program, whether they planned it or not, Google created a way to keep advertising inventory from their competitors while simultaneously not allowing it to compete with their more profitable AdWords inventory. That's a win-win for Google AdWords but a lose-lose for web publishers, affiliate companies, and ecommerce sites that would otherwise be advertising on pay for performance affiliate networks.

3. AdSense is good for Google because it is bad for competing search engines
For awhile the AdSense program blatantly allowed spam sites to participate in their program. Why? How did it benefit Google to host thousands of copyright infringers and article spinners in the AdSense program? One benefit is that it was bad for Yahoo and Bing. AdSense Spam flooded the index of Bing and Yahoo. There is no smoking gun where someone at Google admitted as much. But the reality is that for a time AdSense was a defacto weapon against the other search engines, a weapon that degraded the search indexes of Google's competitors.

4. Data, data, data... and more data
Mediabot, for "bandwidth saving purposes" shares data with the search index. I am not saying that Google shares AdSense information with the search department, particularly which sites are connected. But the associated data is very rich for identifying spam networks, linking patterns, etc.

When someone posts that they are earning less in 2012 than in 2003, it's easy to dismiss it that the world has changed. It's too easy. But then again it's always more difficult to take a moment to think things through, so one can't be faulted for dismissing such a statement. But if you do dismiss that statement then you'll miss out on what's really going on behind the scenes.

[edited by: martinibuster at 2:57 am (utc) on Sep 13, 2012]

 

buckworks




msg:4491018
 7:31 pm on Sep 3, 2012 (gmt 0)

I see many obvious CPMs on many sites..


Leo, CPM ads are targeted by page relevance or by user behaviour just the same as CPC ads are.

Please clarify for us what makes CPM ads "obvious" to you.

Leosghost




msg:4491021
 7:41 pm on Sep 3, 2012 (gmt 0)

One which has absolutely no call to action, no product offered, and in some cases there is no text merely a photo or a graphic with the logo..

I have even seen photos of totally nondescript corners of factory rooms with no logo, no explanation and no markings to say that it is an ad...only "on hover" and only looking at the status bar or actually clicking through can one tell it is an ad and not part of the images on the page..

I have a collection of screen caps of some of them ( I cap less than 5% of them, I nevertheless have 100s from the last year alone ;-)..most of them are totally irrelevant to the sites they were on ( not mine )..and are ads from companies whose sites I have never been on..

A "classic example" ( of totally unrelated, and non personalised ads ) would be the "belly fat" ads ( although these are not CPM "branding", but they definitely are "scattergun" ;-)..they are less prevalent than they were, but still around, and for example, I have seen them on "el reg", when the article I've been reading was not about tech ( the subject of the register ), but not sufficiently well "focused" to pull in subject related ads..

buckworks




msg:4491026
 8:24 pm on Sep 3, 2012 (gmt 0)

no call to action, no product offered, and in some cases there is no text merely a photo or a graphic with the logo.


Those are not necessarily signals of CPM, but they are definitely signals of a clueless advertiser.

The belly fat ads could be either CPC or CPM, but either way the reason they show up is that they're either outbidding or outperforming whatever other ads the algo might be considering for that page at that moment.

not sufficiently well "focused" to pull in subject related ads


If, indeed, there are any subject-related ads available at that moment.

For publishers, the notion of making sure our pages are well focused is vital, absolutely vital. Assuming that subject-related ads are in fact available, we'll have a better chance to get them if the algos can tell without a doubt what the page is about.

Leosghost




msg:4491027
 8:30 pm on Sep 3, 2012 (gmt 0)

The belly fat ads could be either CPC or CPM, but either way the reason they show up is that they're either outbidding or outperforming whatever other ads the algo might be considering for that page at that moment.

That is what I was saying a few posts back.. :)

If, indeed, there are any subject-related ads available at that moment.

Again..That is what I was saying a few posts back.. :)

For publishers, the notion of making sure our pages are well focused is vital, absolutely vital. Assuming that subject-related ads are in fact available, we'll have a better chance to get them if the algos can tell without a doubt what the page is about.

That is what I've been saying for years..:)

netmeg




msg:4491049
 9:20 pm on Sep 3, 2012 (gmt 0)

All this is off the original premise posted by martinibuster, but the bottom line is, Google isn't going to change to suit any of us, so we have to adapt to the program or do something else. Preferably both.

buckworks




msg:4491067
 10:32 pm on Sep 3, 2012 (gmt 0)

If you want to directly address something in the OP, how about this one:

"Make no mistake, the AdSense program competes for limited advertising money with the AdWords program. A weak AdSense program keeps more money in Google's pocket.


<puts on advertiser's hat>

The comment about "competes for limited advertising money" does not match my experience on the advertising side. Running ads on the content network doesn't reduce what we're willing to spend on search ads, or vice versa; they're not in competition. We want strong ads on both search AND content, it's not either/or.

The only limitation is ROI.

Play_Bach




msg:4491069
 10:42 pm on Sep 3, 2012 (gmt 0)

Hi Buckworks,
I *think* what martinibuster is saying has more to do with the split that Google pays to publishers (68%) vs what they get to keep on search (100%).

7_Driver




msg:4491192
 9:44 am on Sep 4, 2012 (gmt 0)

If you don't like interest-based ads appearing on your site, you can try turning them off.

(Or at least you could a few months ago, because I did).

I found that EPC fell slightly, and CTR didn't change - so my EPM ended up lower.

I was surprised by that result - but that's why it's worth testing.

Leosghost




msg:4491203
 10:35 am on Sep 4, 2012 (gmt 0)

You can't turn them off..we have been over that point dozens of times ..and then ASA at the time confirmed to us that you can't turn them off from appearing your site, you can only turn off your site being used to influence the interests that are profiled into the visitors cookie and the data held upon them at Google....

read..
[webmasterworld.com...]

You can't "turn IBAs off" since 2009..!

StoutFiles




msg:4491238
 12:53 pm on Sep 4, 2012 (gmt 0)

It is almostly completely due to oversaturation. Back in '03, there were few players and plenty of wealth to spread around. Now everyone and their mother has a website with AdSense and advertisers can't keep up.

The other major factor is that Google went public in '04, and every year since they have likely been siphoning off money from AdSense to keep their shareholders happy. It's pretty easy to do when they won't share any relevant numbers with you; everything about how you're getting a paid remains a mystery.

Play_Bach




msg:4491258
 1:39 pm on Sep 4, 2012 (gmt 0)

A few minutes ago I enabled text/image ads for one of my units. I just checked the page and saw an image ad for a comedian that's playing here locally in a month. Needless to say, my site and niche have nothing to do with standup comedy. Nor do I recall ever searching for comedians to have triggered some kind of IBA in my history. Instead, this appears to be a hyper local ad based purely on location. Welcome to the new Adsense everybody!

ThatsBoBo




msg:4491309
 4:53 pm on Sep 4, 2012 (gmt 0)

Regarding Interest Based Ads:

In this scenario, we are assuming all bids and quality scores of said ads are the same.

If Google determines that the % chance of a click of said interest based user on an interest based placed ad is greater than the chance of a click on content placed ads, then the Interest-Based ad is placed.

Interest Based ads should make you more money in the long term. If they do not end up making more overtime, see above verbal algo.

Also, if:

Interest-Based ad bid = $5.00 with a 5% chance of being clicked
And
Content based ad bid = $2.00 with 10% chance of being clicked

Interest Based ad will be placed as it will make you (and Google) more money long term in this situation.

In summary, I do not feel Interest Based ads are responsible for a decline in anyone's earnings via Adsense.

Leosghost




msg:4491315
 5:22 pm on Sep 4, 2012 (gmt 0)

Your assumption is erroneous..
Interest based ads are based around the concept of repetitive advertising..

Thus Google's criterium for whether they show an interest ad on your site is not "will it engender a click whilst it is showing on your site" when compared with them choosing to serve a content based ad of equivalent click value..

Google's criterium is "will showing an IBA on any single site, result in a click on that IBA over time in that or consecutive sites that the visitor goes to"..

If G shows content based ads on your site the CTR might be 5 clicks per 100 "shows"..that is 5 clicks for you and 5 for G..

If G shows IBAs on 10 sites and the CTR is 8 per 100 shown overall..That is possibly 1 click for you per site, but 8 clicks for G ..( IBA CTR is higher when taken over time and if the IBA is set up accurately..than CTR on many if not most "content based ads"..especially if the publisher site does not "prepare" the visitor for the ad or get them in a purchasing frame of mind* ( Buckworks will be along, ( I hope ;) to explain in detail why and how advertisers should use IBAs, she has done so before in a past thread at least once that I'm aware of )

If G shows IBAs , they gain, individual webmasters do not..as it becomes matter of chance ( from the point of view of the publisher ) and factors entirely outside of the control of the publisher as to what frame of mind , ( "purchasing" or "repurchasing" or otherwise ) the visitor who sees the IBA is in..

This is why the showing of IBAs is not optional for publishers..G has IBA inventory to move..IBA works for G and advertisers ( but not for individual publishers ) G will not allow publishers to interfere with that revenue stream..

As netmeg says .."publishers are not going to be allowed to drive the bus" ;)..they can, to a degree, choose where they sit, or stand on the bus..or whether they are on or off the bus..but they ain't gonna get to hold the steering the wheel..

*in French we say "mettre l'eau la bouche" or "donner l'eau la bouche"..translates not literally ( ie; word for word ) to "make the mouth water"..a well set up publishers site should be "making their mouths water" when they hit the button and click the ad**..or you can think of it like, a well set up publisher's or aff' page or ad, is like foreplay ;) if it isn't any good, you'll get no rewards ;)..Better is best ..

**As should a good affiliate site...and / or a good ad..

MrSavage




msg:4491322
 5:55 pm on Sep 4, 2012 (gmt 0)

With respect it's absolutely incredible that people think that interest based ads aren't responsible for declines in Adsense earnings. If it made sense you would see it used on the mother ship Google search results pages. If anyone can explain to me or show me examples of businesses that have a store front and signage for a restaurant but behind the door is a shoe store, please let me know. How the hell does anyone know if it was an ad related to your content that got clicked or whether it was an off topic totally irrelevant ad they clicked? Logic says and the reality shown in the past is that the more relevant the ad to your page, the greater clicks, the great earnings. I give up explaining this more. It's another topic but perhaps I need enlightenment to the motive, rationale, etc. as to why interest based ads are the new way. There is obviously a "big picture" aspect to this for which I don't understand.

Leosghost




msg:4491323
 6:03 pm on Sep 4, 2012 (gmt 0)

Most IBAs are image ads too..block them ( and only allow text ads ) and you will get far more relevant ads to your content..if your theme is tight and accurate, and your copy is good and works like I said in my previous post..;)

netmeg's case is an exception ( as are others ) as there are not ads available due to G adwords TOS, for certain site KW subjects..so related or general IBAs will do well there, and on sites in a similar situation vis a vis KWs..

Even so, not everyone can or could make those sites pay, but netmeg isn't "everyone" :)

MrSavage




msg:4491325
 6:11 pm on Sep 4, 2012 (gmt 0)

Thanks Leos I will give that a shot with the image ads. This is completely contrary to what I was told by Adsense folks at Adsense In Your City, but I know you know your stuff. In fact it's only been in the past year where I did switch from using "text only" to "text and image" ads across the board. This is something definitely worth a shot and I appreciate your advice on that.

ThatsBoBo




msg:4491329
 6:31 pm on Sep 4, 2012 (gmt 0)

I am sorry, but I have to disagree with those against IBA.

The fact still remains that if the algo shows that such IBA has a higher chance of a higher return, it will be displayed over that of an interest based ad. Even if it takes time for a user to click such ad after seeing it on multiple sites, multiple times an algo can easily take that into consideration when determining which ad to place. For example:

Lets say that the algo determines that said IBA has this % chance of being clicked based on times seeing on different sites:

1 time 1% chance
2 times 2% chance
3 5 times 3.5% chance
6 7 times 2.5% chance
Greater than 7 times .5% chance

They could use the above numbers to determine which ad to display based on expected returns between contextual and IBA ads.

3 - 5 times = ($5.00 IBA bid)(3.5%) = .175
Contextual = ($2.00 Contextual bid)(4%)= .08

IBA wins and is placed. The numbers would change as above each time, so there would be times when the contextual would win out. Say after greater than 7 times the IBA is shown.

7 times = ($5.00 IBA bid)(.5%)= .025
Contextual = ($2.00 Contextual bid)(4%)=.08

Contextual wins and is placed.

The analogy of a shop with an ice cream sign out front selling shoes inside is not the same as a website taking in visitors that may have just been looking for that pair of shoes that IBA is now displaying on your site.

If your physical store were digital, and could collect the massive amount of data that Google does, and it could place a product that your visitor was recently looking for in front of that store visitor (even if the item had nothing to do with your store), that visitor may indeed purchase it. You can't compare apples to oranges.

Don't get me wrong, I'm no Google-Fan-Boy, but...

Play_Bach




msg:4491331
 6:39 pm on Sep 4, 2012 (gmt 0)

> There is obviously a "big picture" aspect

$ - that's it as far as I can tell. Google is sitting on a mountain of data and I'm pretty sure they're quite aware of where the $ is and are pursuing whichever route monetizes for them the best. In short, it must mean IBAs are working for Google, otherwise they wouldn't be doing it.

londrum




msg:4491335
 6:59 pm on Sep 4, 2012 (gmt 0)

The fact still remains that if the algo shows that such IBA has a higher chance of a higher return, it will be displayed over that of an interest based ad.


IBAs might result in a quick click, but they don't help publishers all that much in the long run.

what advertisers want most of all, is traffic that converts. and the way that publishers can earn more money is to deliver that traffic. our eCPM will slowly go up, and every click we get will be worth more money.

but IBAs knock all of that on the head, because the ad has got nothing to do with the site. it's basically just blind luck. any site could have delivered that click, just by throwing the same ad in front of the same user.

if google delivers more and more IBAs, at the expense of targeted ads, then it will be that much harder for us to make our sites stand out in front of the rest. our skills in delivering targeted traffic to the advertisers won't matter so much, because the ads are no longer targeted to our site

but there's nothing we can do about it anyway, so we just have to go along with it.

buckworks




msg:4491337
 7:17 pm on Sep 4, 2012 (gmt 0)

it's basically just blind luck.


No, it's not just blind luck. An interest-based ad impression is only triggered when something in that user's history signals a higher-than-average likelihood of interest in the ad's offering.

It's not blind luck, but a careful, informed projection of the odds.

londrum




msg:4491341
 7:22 pm on Sep 4, 2012 (gmt 0)

sure, i know that. i know that the ad only triggers when the user has shown an interest in it (hence the name). but as far as the publisher is concerned, its blind luck. our sites had nothing to do with it. that ad could have appeared on any site... any site that the user visited.

an advertiser will not want to keep paying one particular publisher more money, when any site could have delivered that same click.
but when the ads are targeted, and we have a history of delivering targeted traffic, we have a better chance of attracting higher paying ads.

[edited by: londrum at 7:26 pm (utc) on Sep 4, 2012]

Leosghost




msg:4491342
 7:25 pm on Sep 4, 2012 (gmt 0)

It's not blind luck, but a careful, informed projection of the odds.

That they will eventually click, certainly, but the site that they are visiting, when they click on an IBA, has nothing to do with the calculation..

IBAs are good for G, bad for individual publishers, unless their site could not efficiently be used to trigger normal / usual adsense due to lack of adwords ( due to adwords TOS restrictions or other factors ) on the site / page ..subject..

[edited by: Leosghost at 7:30 pm (utc) on Sep 4, 2012]

buckworks




msg:4491344
 7:30 pm on Sep 4, 2012 (gmt 0)

when any site could have delivered that same click


Only if the IBA was outbidding and outperforming the normal topical ads that might otherwise have appeared on that page.

londrum




msg:4491345
 7:35 pm on Sep 4, 2012 (gmt 0)

yeah but what are the chances of IBAs being the same price as the normal ads? if a user visited a site about cars or holidays, or, to use a few obvious examples, loans and mortgages, before they came to your "new shoes" site, then every ad will cost more than your normal shoes ones. they are going to outbid absolutely everything.

SevenCubed




msg:4491347
 7:39 pm on Sep 4, 2012 (gmt 0)

...but a careful, informed projection of the odds.


I'm not too sure about the careful and informed aspect of it. A few weeks ago I wanted to try out the Collusion add-on for Firefox and had to take off all my browser armour protection for it to work properly (surf as a typical user). It wasn't long before I was being bombarded with IBAs about how to invest in the stock market and every "expert" out there trying to sell me their book on stock market analysis on every site I landed on. The reason was because I purposely checked, a few times, the prices for facebook and zynga as they burned on the NASDAQ. The resulting ads were being presented to someone (me) who is LEAST likely to click them. However the sites that I went to where they were presented -- I would have been more likely to click an in-context ad because they were my typical sites of interest. There has to be many many examples like that in the wild.

Leosghost




msg:4491349
 7:41 pm on Sep 4, 2012 (gmt 0)

outperforming

Outbidding ? yes
Outperforming No..

Not on that site..but outperforming for G "overall" yes..but not necessarily on that particular site..( in fact it performance on that particular site for that particular IBA cannot be calculated , because by definition each IBA shown on any site has no performance history on that site ..( each visitor sees a different IBA ..by definition ;)
only on the network..

IBAs outperform on "aggregate" over the content network,( thus G and advertisers who know how to use them like them ) they rarely "outperform", from an individual publisher point of view, on particular sites..

buckworks




msg:4491350
 7:48 pm on Sep 4, 2012 (gmt 0)

they are going to outbid absolutely everything. .


Perhaps, but they also have to perform (which in this context I would define as getting a competitive CTR when placed in a certain context or in front of a certain user).

bombarded with IBAs about how to invest in the stock market


That sounds to me like remarketing ads, which are not the same as Google's interest-based ads.

buckworks




msg:4491352
 7:51 pm on Sep 4, 2012 (gmt 0)

advertisers who know how to use them like them


Keep in mind that if I can't figure out how to use the AdWords system profitably, I won't be running ads at all.

SevenCubed




msg:4491354
 7:56 pm on Sep 4, 2012 (gmt 0)

That sounds to me like re-marketing ads, which are not the same as Google's interest-based ads.


Ahhhh ok thanks - easy to see I am not an advertiser. So I'll assume re-marketing ads are instigated by advertisers and not by google? Still it seems they affect the individual publisher sites adversely.

Leosghost




msg:4491355
 7:57 pm on Sep 4, 2012 (gmt 0)

remarketing ads

He would have had to make a purchase or made a substantial "interaction" such as filling in a form etc with the previous site(s)for them to be "re-marketing ads"

SevenCubed's experience ( as described ) is of classical IBA ads, according to Google's own definition of such..
[support.google.com...]

buckworks




msg:4491358
 8:05 pm on Sep 4, 2012 (gmt 0)

would have had to make a purchase or made a substantial "interaction" such as filling in a form etc with the previous site(s)for them to be "re-marketing ads"


Wrong.

The only "interaction" needed is to visit a page that has the remarketing code snippet installed.

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