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Page Impressions = Number of times an ad unit (collection of 1-4 ads/image) is displayed. (2 ad units on the page gives 2 impressions each time the page is loaded).
Clicks = Number of times someone clicks on an ad. If they leave your page, hit the back button and click another ad that's two clicks.
Your earnings = Your earnings
Clickthrough Rate = 100 x Clicks/Page Impressions (it's expressed as a percentage)
CTR= Clickthrough Rate (see above)
CPM (or Effective CPM) = Earnings per thousand page views
Not displayed but often discussed:
EPC = Earnings Per Click (your dollar earnings/number of clicks)
It is often argued that this is a metric you shouldn't obsess about as the final earnings are what count (more later)
Real figures are the page impressions, clicks and earnings. Google updates these - usually - several times during the day
Derived figures are the figures you can calculate yourself but Google displays for your convenience. These get automatically updated based on what the real figures are showing at any point in time.
What we've learnt since the program started:
1. Big picture You need to look at the big picture. The figures your stats give you at any point during the course of the day are likely to be inaccurate. If you check your stats several times during the day do it for amusement value (and negligible site monitoring value) and don't get concerned or ecstatic till a few hours after the end of the day.
2. Stats Updates/Speed of Updates Sometimes there are long delays in updating stats. If your stats update every two hours but one day you see no update for 12 hours - that is natural behaviour. There's no need to panic. Not even if other webmasters are seeing normal updates.
3. What's updated Google updates the real figures. The derived figures are just a local calculation based on the real figures. It's best to ignore the derived figures during the course of the day.
4. The Lag Google updates different real figures at different speeds during the course of the day. Let us take some examples and see how they pan out
- A. At 2.00 PM your stats get updated but what Google hasn't told you is that the page impression figure is the latest figure from 1.00 PM but your clicks and earnings figures are from 11 AM. This will appear to be a sharp drop in CTR, CPM and, of course, clicks and earnings.
- B. At 10 PM your stats get updated but what Google hasn't told you is that the clicks and earnings are from 7 PM but the impressions figure is from 5 PM. This will appear, at first glance to suggest you've had a sharp rise in CTR etc. which is not necessarily the case.
So how do you monitor these figures? Ans: By ignoring odd looking figures during the day and seeing how they pan out by close of business.
5. Close of business figures It's midnight on the west coast of the US of A, 8 AM in London and you want to see the latest figures. Note: You can't assume the figures you see there are the closing figures. Only when you start seeing some numbers for the new day can you assume that the previous days figures have all been updated and aren't going to change anymore.
6. Slow stats predate changes to program Usually when there are several consecutive days of extra slow stats updates there is an improvement or change to the Adsense program imminent. We saw these delays before the introduction of channels, before Smart Pricing, before the introduction of various new versions of TOS, and at several other times that Google made changes to the program (even when they were just adding support for new languages). It's not cause to panic.
7. Some figures carried forward several days Following on from point 4 it has often been observed that Google carry some figures forward for several days. They may freeze some quantities of clicks (and the associated earnings) to examine in closer detail for clickfraud/tracking purposes. If they do this it is possible to see earnings shoot up sharply on a day when you least expect it to because they may credit you with several days worth of frozen clicks/earnings... all in one hour. Your mid day CTR could shoot up from 0.5 to 10%, your CPM could shoot up from $2.00 to $200... it will gradually drop over the course of the day but still end up higher than previous days. Make a note of the days this happens. It may be useful when you are doing long range analyses of your stats.
8. Because of point 7 above the closest you can get to a serious analysis of your figures is to look at them over the course of several days/weeks/months (and preferably excluding the last few days from your analysis). One method used to great effect by some members here is the rolling average (Google it if that's an unfamiliar term).
Common Issues Raised Here
EPC does matter/ EPC doesn't matter
It does and it doesn't. First, you have no control over EPC. Even Google has very little control over EPC. There is some evidence (based on Google earnings data published at time of IPO) that Google pays publishers 70% or more of what Adwords collects from advertisers but the EPC of your own ads are influenced by a lot of variables including advertiser budgets, seasonal changes, ad campaigns launched and ceased ... and many others. The productive thing to do is to concentrate on metrics that you do have control over like page impressions and - to a certain extent - clicks (by optimising the position/colour of your ads).
What's an average CTR/CPM/EPC? How do I know if I'm doing as well as I can?
Personally I feel that any discussion of average CTR/CPM/EPC across different sites with different subjects, in different countries ... is a complete waste of time. First, there is no way of working out an average unless Google discloses the full figures that only they know. Any average calculated from figures disclosed by webmasters here is likely to be skewed because the people who do well won't disclose their figures so you have an incomplete picture. If there are only two categories of publisher who make either <$100 or >$10,000 then how will the knowledge that the average is $4,000 be of any benefit to anyone? It could drop to $1,500 if one or two of the multimillion dollar publishers pull out. And adding a million other sub $100 publishers may not move the average by more than a couple of dollars.
Someone else feel free to do a PART II covering "Search" and "Channels" or, if I have the time in a few days, I may attempt it. :)
Happy earnings ...and good mental health ;)
Page Impressions DO include PSA's (Public Service Ads) and Alternate Ads. Clicks DO NOT include clicks on PSAs or Alternate Ads. So if you get a high proportion of PSAs/Alts the CTR will be inaccurate (no longer shows the percentage of paying ads that are clicked on).
But really Macro I think you've hit the nail on the head which would answer most questions: never take the slightest notice of any stats until they are at least a day or two old! It's just a recipe for high blood pressure.
I also rarely get PSA/Alt Ads (to the point where I don't bother to config an alt ad) but it might still affect some.
Just proves that nobody reads what I write... :-)
Well I read what you wrote and realized what you meant -- you just caught yourself before I got here. :P
So far (I'm still pretty new to this) I only get PSAs when I accidentally fire up a page on my local server. I've added some "testing server" checks to reduce the number of times this happens but I'm sure those views are still being mixed in to my stats.
EPC does matter/ EPC doesn't matter
It does and it doesn't. First, you have no control over EPC. Even Google has very little control over EPC. There is some evidence (based on Google earnings data published at time of IPO) that Google pays publishers 70% or more of what Adwords collects from advertisers but the EPC of your own ads are influenced by a lot of variables including advertiser budgets, seasonal changes, ad campaigns launched and ceased ... and many others.
Just to add and clarify one thing: The 70%+ figure from the IPO report includes "premium publishers" and sites like AOL who get better rates so the number is likely skewed a bit for regular Joe publishers.
I have a few things to add, even though you touched on them.
1. Earnings go up and earnings go down. They can also go up and down again. Adsense is a chaotic system, get used to it.
2. You only bank earnings, not EPC or CTR (I have never seen a cheque with the amount to pay as "3.5%").
3. EPC is a figure you should mainly ignore. If you pay attention to it, the end result is loss of sleep and growth of unwanted hair. The biggest problem is that most people calculate it, but don't realise that they are calculating an average that shifts at every moment in time. It is the worst form of averaging and we don't have access to all the data to do it properly. Not that it matters, because we have no control over EPC anyway.
4. If you have a Google conspiracy theory, please try to understand how Adsense works before convincing yourself that the theory is true.
5. Google is not capping your earnings, see point 4.