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Sudden increase of CPC recently?

My campaigns are full of inactive keywords.



6:37 pm on Apr 5, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

I didn't review my campaigns since last week, I remember a campaign with arround 1000 keyword in which I had about 150 "inactive for search".
Today I have 750 "inactive for search"!

Does anybody get any similar to this recently?


4:33 pm on Apr 10, 2006 (gmt 0)

5+ Year Member

Then that is absolutely bad business on Google's behalf. For a client to spend 120k a month, and not have a dedicated manager is beyond me. If you could, I would try to go above the slacker to see if you could be reassigned to someone who actually wants to work.


4:52 pm on Apr 10, 2006 (gmt 0)

10+ Year Member

The minimum bid for many of my keywords has dropped from $5 or $10, but not back to the original levels, and about 40% are still $5 or $10. For example, a set of keywords that were running in the 20 cent range now need a 50 cent bid. It's still too high.

I've been changing all my ads over to direct to merchant, and outbidding other affiliates (many of them running crappy, cheap ads). My sales are returning to normal that way, albeit with a smaller profit margin, but it's still profit. Google thinks their visitors are better served going direct to the merchant, yet I know I have more information on my pages and better comparisons of products. Google just doesn't think there's any value in that.


8:51 pm on Apr 10, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

Just wanted to add my 2 cents for what its worth as a publisher, on the adsense side since this was first reported we are seeing a large increase of 40% ctr across every property we own, this would translate to me after watching our stats closely for 3 years almost as a increase in the quality of the ads now showing on our properties and being much more related to what users are looking for.

We are seeing no increase in payout however epc wise but a large increase in ctr on a large volume of traffic so perhaps it is a tweak to improve accuracy as Google is stating and not a wild theory of them trying to cash in etc. Just my 2 cents.


8:06 am on Apr 11, 2006 (gmt 0)

10+ Year Member

Drall, I'm seeing similar % increase in clicks on my adverts on the landing page from Google / search partner sites. Certainly relevance must have been improved Google's end. So well done to Google even tho my revenue and ROI are down.

I've resisted raising my bids and traffic is back to around 60% of pre 5th April.

I wonder, did anyone see more new inactive phrases for broad match than for phrase match than for exact match? This would be interesting to know.


12:01 pm on Apr 11, 2006 (gmt 0)

The same thing happened to me. After a day on the phone with the arrogant Google representatives, I discovered that it was at least partially about duplicate content.

My site is an affiliate site that uses descriptions from a merchant datafeed. I knew this would hurt me in the SERPS but the site was created with PPC in mind.

I removed the descriptions that were not my own content and within a few hours my keywords were back online.

On a side note, dealing with the people at Google and their "take it or leave it" attitude has certainly prompted me to set up PPC campaigns elsewhere in an effort to reduce my dependence on Google. Google is an arrogant company who has once again demonstrated that they will destroy the credibility of their business model before they will admit a mistake.

I pointed out site scrapers who were now occupying top PPC spots since they kicked all the good advertisers out. They said nothing. I pointed out site scrapers in the top 5 SERPS for certain keywords.

They claim to do all of this in the name of the customer experience yet they seem to place site scrapers above quality sites. Makes me wonder how many Google employees might have their own web sites.


12:33 pm on Apr 11, 2006 (gmt 0)

10+ Year Member

So I guess an official explaination from AWA is not going to occur here?


1:35 pm on Apr 11, 2006 (gmt 0)

I'll give it you officially, from the inside: "We need more money. Selling off 1.5 billion worth of shares per month is not enough, we must get 2."


3:15 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

I wonder, did anyone see more new inactive phrases for broad match than for phrase match than for exact match? This would be interesting to know.

Exact 32%
Phrase 24%
Broad 44%

Total Keywords
Exact 33%
Phrase 24%
Broad 43%

Seems to be across the board, Simon. I've looked for a rhyme or reason without much success. Certain times including a lesser used preposition had a 50 cent bid, without the preposition wanted $5-$10. Many sites which in my opinion are lacking in quality were untouched.

The only vague sense that I got was that text to HTML ratio may have been considered, but contradictions abound there too.

Only trends I could discern.

22% of keywords are now inactive. I met some minimums where I really needed the keyword bad, but I'd say they represent 2% - Most keywords had impressions and usually clicks. CTR could be 15%+ on an "Inactive" and a CTR less than 1% was left alone within the same adgroup.

Sorry, I'm not smart enough to understand the algo ;)



4:58 pm on Apr 11, 2006 (gmt 0)

<rant>This is what you get when you use "free conversion tools". All they want to know is what converts better in which niche, and guess what - you webmasters caused this M***F*** G$$gle to go "GREED ALL THE WAY".</rant>

The only thing I can suggest is anyone in their right mind to IMMEDIATELY remove any G$$gle conversion tools they have installed.

The Fool pays 10-fold.

<edit>It is a dream-come-true subject for a journalist. Imagine title "Google deceives advertisers with its 'free tracking' tools to pump up the prices of ads". I'd bet this'll get slashdotted</edit>


5:15 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

aleksl - you actually bring up an interesting point... how many of us use Google Analytics too?

I do.


5:19 pm on Apr 11, 2006 (gmt 0)

It is not an interesting point, it is a freakin fact. You DON'T EVER GET A FOX TO GUARD HENHOUSE.

G$$gle sells you traffic, and if you buy at 10 cents you should NEVER EVER tell them that it converts at 1000%, or you will be paying a $1 in no time. It is a common business sence.

Seriously, I think this is so big it deserves front page thread at WebmasterWorld, much more than that odd Orion algorythm topic.


5:39 pm on Apr 11, 2006 (gmt 0)

10+ Year Member

I had the 1000% increase in cpc, like from 0.10 to 8.27 and I use Analytics with really good ROI.

My Average Adwords CTR is > 10%...so it's not possible that they are not performing well!


5:45 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

"It is not an interesting point, it is a freakin fact.."

I for one would like to see the facts behind this...


6:30 pm on Apr 11, 2006 (gmt 0)

aleksl you are correct - NEVER EVER EVER use those free tools and complain that now they are charging you more. No one gives you anything for free!

I fight my clients all the time about these emails they receive from Google and Yahoo about free tracking and reporting tools. Why don't you just fax them your balance sheet and bank account numbers?

I also love when that whenever you talk to Google and they look into your account and see that you that you are not using their conversion tracking code that they try and 'sell you on it'. I say we have our own tracking codes, and they usually try and suggest that theirs are better or more accurate :)


6:33 pm on Apr 11, 2006 (gmt 0)

ConfusedWriter - it is very simple.

1. Fact. You used to be able to pay $0.10 per click on G$$gle Adwords
2. Fact. Google recently implemented and promoted "free conversion tools".
3. Fact. Many performing keywords are now over $0.50, and some are over $1.

From #2, since G$$gle is in business of making money (for those of you still believing into "be no evil" fairy tale we can discuss it in another thread). A BUSINESS is not something that wastes resources on nice-to-have tools. Obviously G$$gle was looking into which keywords convert better, i.e. into your data. Any traffic selling entity will want that data, and G$$gle is not exception.

Now, in order to get to #3, you need data from wich you can draw reasonable analytics . "Free conversion tools" give G$$gle such data. No doubt, they may have purchased some analytics, but why, if YOU WEBMASTERS give this VALUABLE INFO to them for free?

Should I quote?

Kamangar said Google would also use the conversion data to gauge the performance of keywords. While he said the data would not initially be used in determining rank, he did not rule it out in the future.

"It's a quality signal," he said. "We're always open to new quality signals about which ad we show in what order."

Danny Sullivan, editor of Search Engine Watch (which is owned by the parent company of this site), said such data could show quickly how robust the return is for keyword advertising.

"I suspect the main thing Google might do is watch to see if they can determine that clicks are converting well beyond what they cost," he said. "If so, they might decide to up minimum bids on certain terms."

I rest my case


7:00 pm on Apr 11, 2006 (gmt 0)

It's shocking that so many advertisers can be so blind. Of course Google will use any information you give them to their advantage; like it's been pointed out - all companies do this.


7:18 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

I'm not saying Google doesn't do that in general, but this theory doesn't jive with what happened on April 5th.

Google sees that I bid on keyword "X," and also has conversion statistics, available through Analytics showing that "X" converts very well (let's say I make $10 for every $1 spent advertising on Adwords for that keyword).

Why then would Google hike min CPC prices to 50x? That hike then makes it something like for every $10 I make on keyword "X," I've now spent something like $50!

It's not tightening screws and shrinking my margins - they're putting me out of business!

If Google is doing what you suggest, margins would go down, but I'd still stay afloat.


7:40 pm on Apr 11, 2006 (gmt 0)

10+ Year Member

Thanks for the feedback Israel. I have many more broad match than phrase or exact match.

I was wondering if I should move some broad >> phrase or broad >> exact match. From your info this wouldn't make too much difference.

I thought of doing that to improve the relevance of my landing pages after using Googles keyword tool. Based on a small selection of my keywords, mostly (there are always exceptions!) a keyword that had gone inactive had a significant number of suggestions from the keyword tool. Those that stayed active had only a few keyword suggestions. I kind of jumped to the conclusion that the ones that had gone inactive went that way since they could be shown on Google for a more diverse range of phrase matches. ie Google moved the relevancy knob hard to the right.

I guess they've backed off that knob a bit since.

As mentioned above, I saw a 30-40% increase in clicks on ads on the landing pages. Did you see any improvement?


7:45 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

Since this is still a matter of conjecture, aleksl, can you tell me why my keywords have increased 10x, but I do not used Analytics? or anything tracking related by Google?

And, if I may quote:

"----->I suspect<----- the main thing Google might do is watch to see if they can determine that clicks are converting well beyond what they cost," he said. "If so, they might decide to up minimum bids on certain terms."

Case re-opened.

Quantam Goose

7:55 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

Somehow, in all these posts, there is an underlying theme or assumption that Google "is" or "would" act in their own best interest. And that if they are not, then, they are being punitive or misguided or whatever. I submit:

1. What is in their interest depends on who is in control of the business model. If it is an MBA with lofty credentials, he can easily crash (over time) the business. Probably out of arrogance or ignorance - take your pick.

2. If the control guy put out a new "theme or direction" such as "cleanup all the people gaming Google", where is it written that at the implementation level Dufus is not controlling what he thinks is in line with the new direction.

So, between misguided MBA wheel horses and the algorithm Dufus you can have chaos.

The reason I point all this out, is I regularly see postings on this forum that attribute to Google some "God Like" intelligence the likes of which the world has never seen. In point of fact, Google is now almost a blue chip large Company protective of revenue and market share. And ALL large companies have a high probability (since they are made up of humans - gaming within the company for nefarious purposes) of just plain screwing up.

The purity of Googles "search engine" and its rapid dominance is just market BS. The genius of Google (and most companies only do one or two things fabulously right in their lifetime) was the astoundingly simple "ADwords/Adsense" scheme. Not only was it cheap and effective, but also it was an advertising dream with links back to the mother ship.

The Stanford "secret" algorithm was the founders breathing their own gas.

Adwords/Adsense is the core engine, and if for the reasons mentioned above they are damaging that engine, or more likely, morphing Google into a manufacturer approved, Fortune 1000 approved, sales channel - then the street guys, mostly everybody here, will simply find other channels or identify the next "Google".

A corporate bureaucracy is one of the dumbest items on the Planet.


8:02 pm on Apr 11, 2006 (gmt 0)

10+ Year Member

Could it be that the market is saturated for google? No new customers coming on board so it is neccesary to squeeze existing advertisers? If so, it bodes poorly for them going forward, you can only make so many trips to the well before it goes dry.

Bye bye stock market darling, it was nice while it lasted but with no new blood coming into the income stream you are a dinosaur, time to look for a new trophy stock, you are old and a bit ugly.


8:05 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

It's possible. I could definitely believe that with increases of say $0.10 to $0.15-0.20. But increases of $0.10 to $10.00 sounds more like a super-glitch.


8:42 pm on Apr 11, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

I could definitely believe that with increases of say $0.10 to $0.15-0.20.

... and even that is too much! Think about that, we're talking about 50% to %100 increase of your costs. Who on earth give a 50%/100% increase on any product these days?

They really messed up, because must of us didn't rise our bids. So they ended up losing money. A slight but generalized massive increase in the cents range would have a bigger effect in earnings to them since most people would just increase the bids without too much complain.


8:56 pm on Apr 11, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

People, you really need to think. It wasn't a glitch. It's a polite way of saying that you are not welcome. They know you can't afford $10 or $5 or $1. They want you to leave. This happened back in November too.

G now has enough of a base that tossing out what they deem as "undesirables" from a paying program is something they feel they can afford to do.

That is how big G is now. They don't care about you or your money. They get enough money from nice looking sites from good neighborhoods. (aka ebay, shopzilla, dealtime, etc)


10:09 pm on Apr 11, 2006 (gmt 0)

hannamyluv I don't completely agree. One of my clients started a second website and second Adwords account, but since it was a new site the CPC prices were obscene - this was about 3 months ago.

We basically stopped advertising on this new site; last week a Google rep. called me to try and get us to resume bidding on this account. That kind of shoots down your theory that they don't need money from smaller advetisers. And this is in a very competitive industry - not one they need to grow.


10:40 pm on Apr 11, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

I didn't say smaller, I said prettier.

I firmly believe this comes down to an image thing. They don't want their ads associated with crappy looking sites. That's why the big doorway type sites don't get hit. They look nice and don't give the ads a bad rep.

I think it does have to do with human intervention. I think for awhile now they have had people looking at a small group of sites and determining what unconcious factors make them like it or not, then introducing it into the algo on a larger scale.

And I also think this is testing ground for the organic side.

The reps wouldn't have a clue. G wouldn't trust them to decide if a site is "worthy". They depend on the sales reps to get the people in and then weed the bad ones out later with an automated process.


11:34 pm on Apr 11, 2006 (gmt 0)

5+ Year Member

intresting theory about analytics and conversion tracking...

I have been using the conversion tracking in my account but wasn't able to set it up properly for my second account for quite sometime.. when the theory above came about, I immediately looked at my account, it could be coincidence but best converting keywords on my first account is at $5/$10 range.. my second account is at $1/$2 but doesn't have conversion tracking at all...

now another interesting thing is I have a different set of campaigns for other industries and these didn't get affected as the others, they never had a conversion tracking in place since they were started...

I think the conversion data could be derived from all the bidders that provided the conversion data then they would decide ok, these are the keywords that converts... whoever is willing to pay a premium we can show those... this also means better quality for the end users because history says other people took action. "Better revenue for us, better experience for end users fewer choices, also better for those willing to pay higher, less competitors" win-win? hehe...

could be all coincidence. although we can't really completely dismiss it.

am not too happy but not too sad about this... google is becoming a smaller percentage of my advertising budget.. since its so frickle minded.. we can't spend all the time baby sitting it.. we got better things to do like building real business..


1:24 am on Apr 12, 2006 (gmt 0)

Answering a few questions, and restating my point.

ConfusedWriter: can you tell me why my keywords have increased 10x, but I do not used Analytics?

It doesn't matter now that you didn't use Analytics. What matters is that hundreds of clueless webmasters and equal number of business-challenged managers desided to give away a farm (all their conversion statistics) to G$$gle. G$$gle has the data now, and they can up the prices to make it a cash cow. It is irrelevant now whether you did it or not.

It may be too late, yet I'd seriously urge anyone using Analytics on their sites to IMMEDIATELY REMOVE IT, for the sake of their business.

etr06: It's not tightening screws and shrinking my margins - they're putting me out of business!

hannamyluv: G now has enough of a base that tossing out what they deem as "undesirables" from a paying program is something they feel they can afford to do.

Finally, someone started to notice. If you built your business on buying cheap G$$gle traffic, be prepared to start receiving Social Security checks. G$$GLE IS PUTTING YOU OUT OF BUSINESS, for giving away their data.

ConfusedWriter: "Danny Sallivan: If so, they might decide to up minimum bids"

There's no more "might", they already did.

Moderators, I seriously think this topic deserves front page.


1:40 am on Apr 12, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

If you built your business on buying cheap G$$gle traffic

I don't think is an issue either. It's actually not in G's best interest to jack up prices. New people wouldn't sign on if the word got out that you couldn't get a KW for less than $1. There is plenty of .05 (or less) KWs left. This is actually a process to keep those slots open for new advertisers.

G also can not afford to openly ban sites that are not "aesthetically" pleasing as it might discourage new advertisers from signing on. It's much better to get someone on board then dump them later than to scare off a perfectly good customer.

But on a side note, while I don't think they are using conversion data to determine bids (too much they don't know, mainly operating costs and cost of goods) I do think it's a bad idea to let them have it on principle.


3:54 am on Apr 12, 2006 (gmt 0)

10+ Year Member

I don't know which has more crakpot theories, the recent google increase in CPC or the JFK assasination.

Seriously though, every theory someone has appears to have a counter argument. For example, to the person that said google only wants the big time advertisers. Then why would they introduce their new "quick start" program aimed at small mom and pop retailers.

Or the argument that google is now using covnersion data to increase CPC on the great keywords. Once again, this does not add up either since the logic would say they would increase the CPC to just barely being profitable, but it seems like they have made it totally unprofitable.

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