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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.
[edited by: markus007 at 8:08 pm (utc) on April 1, 2004]
<paraphrase>........New AdWords pricing
model will automatically adjust the price of clicks based on their expected value to the advertiser.? Taking into account the keywords or concepts that triggered the ad.......
Too early to tell how it will affect publishers, hopefully not everyone will be adversely affected.
[edited by: loanuniverse at 9:15 pm (utc) on April 1, 2004]
1. They're "enhancing our targeting technology" which is supposed to not only figure out the content of the page, but ascertain the relevance of various concepts found on the page. This is supposed to result in better targeted ads and higher ctr.
2. They're changing the payout structure. CPC, for the advertiser, will flux, depending on Google's estimated value of the lead for the advertiser. They give an example that clicks from the same ad for a digital camera will cost more on a web page reviewing digital cameras than it will on a page about photography tips. It seems that the more targeted your content is to the ad, the more the ad will cost, and the more you will make as a publisher.
I sure hope that their decision to base CPC on perceived conversion potential is based on some actual research, and not just on advertiser perception (which may or may not be accurate) that certain types of content generates less worthy leads.
joined:Oct 27, 2001
2. They're changing the payout structure.
Not exactly: They're introducing variable ad rates, with the system apparently determining what a click is worth in any given context. (In other words, the cost to the advertiser may vary, and the earnings for the publisher may vary as a result, but that doesn't mean the payout formula is changing.)
Like, will the Adwords advertiser be able to say -- " I will pay more for this click if the click comes from this page, blah blah blah." Will this provide the needed control advertisers have been asking for from Adsense?
Hmmm ... interesting developments. Questions, questions and lots of questions
ie photography is a 40% match for 'digital cameras' and 'canon digital camera review' is an 80% match. Therefore if the page is better matched the same digital camera ads appear but will pay better.
This makes sense to me - I have a lot of pages where very loosely related articles are serving the same ads as highly related pages. You should earn more on the more highly related ads as they will convert better for the advertiser.
joined:Oct 27, 2001
I don't know EFV, they are throwing another factor into the formula. To me this changes the formula.
It changes total incoming revenues for Google and the publisher (and, as a result, the publisher's earnings), but it doesn't alter the payout formula. There's been so much paranoia on the "payout" issue that we need to be careful about the wording we use. Otherwise, some publishers are going to get the mistaken idea that Google is varying the revenue split instead of the ad rates.
Seems like they're short-changing us adsense-publishers and trying to fob us off with supposedly higher CTR rates. Like how are they going to achieve that? We have more control of CTR than they do.
joined:Oct 27, 2001
I hate to say it but it doesn't look like any of us will be experiencing a rise in earnings with this new payment structure.
That's hard to say. If conversion tracking comes into play, some publishers could benefit. At any rate, it shouldn't be too long before the results of the change begin showing up in our Google reports.
Hopefully, Google values their customers enough not to make too big of a profit grab.
For one thing, we all know that Yahoo will roll out a competing product soon, and Google will have to be careful.