NoLimits - 10:12 pm on Jan 10, 2006 (gmt 0)

For the first year or so that I was with AdSense, I wasn't a dedicated webmaster. My site had a fair amount of traffic (1,yyy unique daily) but very little SERP activity.

My EPC for Adsense was the HIGHEST it's ever been during that time period.

I noticed a great opportunity to make money, and began to research SEO and continue the developement of my site. I managed to attain fairly good rankings in Google right off the bat, assumingly due to having a 4+ year old domain that has an active forum with lots of IBL's.

Suddenly, I had reached what I thought was eCommerce nirvana - with thousands of Google referrals coming in daily. It was a steady rise from 1,yyy to 1y,yyy uniques daily. My EPC fell, as my traffic rose - eventually hitting rock bottom at about 1/5th of what it was with less traffic.

I lived with this until YPN came out, and I quickly applied and was accepted early on. I gave Y! a good deal of my ad space because it was doing a little better for me on the bottom line. I cut adsense impressions down to the amount of views it was at prior to my search engine success - and magically over the span of a week or so EPC climbed back to where it was the last time my traffic (as far as AdSense can tell) was that low.

Then came Jagger -
NO search activity - none, virtually zero (from google)
I switched all my inventory space back to Google, because with the LOW CTR of YPN for me, it wasn't worth waiting for 100+ pages for that magical big dollar click - eeeking out 2,yyy uniques a day on good days, EPC remained fantastic with AdSense.

Then I met Google Images - traffic started to trickle in again, this time from images.google.com - I left AdSense with 95% of my ad inventory and watched the EPC fall day by day as my traffic increased.

This brings me to this week. Google images has been sending me tens of thousands of referrals - destroying any prior records by mid-morning. My EPC continues to fall...

The last 2 times I saw this happen - I dismissed it, after some complaining, as the result of depleted inventory due to my extra clicks - or smart pricing.

I will not dismiss it again. When I look at an EPC graph for my site from the time I started with AS to today, it looks normal... ups and downs. The magic happens when I make a graph with both clicks by day and epc. My EPC is right in synch with my Clicks per day... the higher my clicks go - the lower EPC goes... time and time again.

I don't know what to make of all this other than, it has led me to believe that there is a sliding scale at which we are paid, based on the number of CLICKS your site receives.

Why do I say based on Clicks?

- I noticed that if I improve my CTR, my EPC will adjust itself accordingly to make it so that I end up back where I was at before. I consider this an affect of Smart Pricing - and I ACCEPT IT AS SUCH.

The problem is have is when I simply increase my amount of traffic - FROM THE SAME SOURCE - and my CTR remains the same :::: and the EPC STILL falls off. The more clicks I get in a given day - the lower my EPC will be, almost guaranteed - this day, that day - every damn day.

Some things that I should note, as I know my post is disorganized... perhaps I can fill in some blanks.

+ I am not depleting my ad inventory. The ads are the same - ALL DAY, almost every day. There are several very large industry players in my niche that get the exact same adverts I get on my site... ver batim.

+ I believe that Smart Pricing is the reason I see my earnings "normalize" when I make a change to up the CTR - but not when traffic from the same source increases and EPC still drops.

+ SmartPricing is supposedly updated weekly... I notice that if Google SERPS shuffle, and my traffic goes through the roof like the flip of a switch - my EPC IMMEDIATELY falls off when the traffic starts coming in - and I mean immediately as in, within one hour the EPC is waaaaaaay lower than it was before the traffic flood started. It most certainly does not take them anywhere near a week to cut your EPC by 80% or more, it can happen over the course of 10 minutes - and then it sticks for about a week.

+ On the other end of the stick, if all of that traffic goes away as quick as it came, my site will continue to have a crap EPC (from high traffic levels) for a few more days. So the week theory checks out here.

So what is the deal really? Why do I always magically see this dramatic decrease in EPC (80-85% less than on days where my number of clicks remains relatively low is where it seems to bottom out)

I have switched 90% of my inventory to Overture, because I'm tired of games and theorizing about the internal workings of adsense. I want what is best for the advertisers too - so if there is something Smart Pricing doesn't like about more traffic from the same source - then it needs to be more transparent for me to do anything about it. I see no reason for such a sharp decrease in EPC... especially considering it can happen at the drop of a hat, and takes nearly a week to correct itself when traffic returns to "normal" in my experience.

At this point, even if Yahoo's CTR is garbage for me - I know what I am making per click, and it does not change based on weather or not I got 100 or 1000 clicks on a day to day basis.

Here is how I view adsense clicks in terms of value - please note these are made up numbers:

40 Clicks over the course of a day = .2 per click
40 Clicks over the course of an hour = .05 per click

100 Clicks over the course of a day = .15 per click
100 Clicks over the course of an hour = .03 per click

You get the point...

My final conclusion (more speculation) - is that AdSense discounts clicks based on the amount you are receiving over a given unit of time. I don't know if it is a static scale for all sites, or if they base it off of your site click history or even indivual page click history.

My big question is... Had my site STARTED OUT - with the level of traffic and clicks that I am getting right now - Would I be seeing such a low EPC? ... or is my low EPC the affect of having a staggeringly lower number of daily clicks on average over my entire time with adsense? All of the time I invest in finding out why my AdSense revenue does what is time wasted. I should be adding content RIGHT NOW - but the amount of monetary difference the EPC makes forces me to investigate.

I am going to give Google just enough traffic to keep them busy (just enough that my EPC stays high) - and Yahoo will get the rest until I can figure this mess out.

Any opinions, advice, or similar/opposite experiences welcome. I'm just trying to learn why this is repeatedly happening to me so that I can correct it.

[edited by: Brett_Tabke at 7:44 pm (utc) on Jan. 11, 2006]
[edit reason] fixed typo upon request [/edit]