2003 to 2006 - is the trend up?

Are you earning more now as advertisers pay more?

[farmboy]

Via another forum, I know someone who used to be a heavy seller on eBay. As competition increased and eBay's fees increased, his success on eBay began to dwindle.

Sometime around 2004 he discovered and started obtaining traffic via AdWords. The $0.05 and $0.10 clicks proved to be a good boost for his business.

He says the cost of those clicks gradually increased over time up to $0.30 or $0.40 and then eventually over $1 per click as more and more of his competitors discovered Google PPC advertising.

Now he reports moving to purchasing individual text ads on sites owned by individuals where reviews, articles, etc. are published. His description of these sites make them sound very similar to the type many here have developed with AdSense in mind.

If the demand for particular keywords is increasing it makes sense the cost to those advertisers would increase. But it also makes sense the earnings for AdSense publishers would see a corresponding increase, unless there are a lot of publishers coming online and always increasing the supply of ad space.

(Makes you wonder about the value of recruiting more publishers for Google via Referrals)

So which is it - is there a trend upwards for your earnings as more advertisers have discovered PPC advertising - especially on Google, OR is this man just in one of the few businesses where the cost of keywords has increased and not retreated?

Also, for those of you selling ads in addition to putting up AdSense, are you doing it alone or are you using some type of ad network.

FarmBoy

[farmboy]

And a related question - If I am in the widget business and want to purchase widget PPC ads, will my average cost per click be higher or lower (or no difference) if I only have those ads show on search results and not in the content network?

FarmBoy

[G_Smitty]

You will pay more for the same quantity. There would be more competition for the smaller serving space.

[europeforvisitors]

Meaningful comparisons between 2003 and 2006 are difficult, because few Web sites stand still. My own site has a lot more pages and--just as important--more pages on different topics than it did three years ago. So, even if one were comparing average earnings per click (as opposed to eCPM and total revenues, which would be affected by traffic), it would be hard to make an accurate comparison. (And it wouldn't be possible to compare specific channels, because channels didn't exist in the early days of AdSense.)

Still, I just did a quick comparison of March 1-27, 2006 to March 1-27, 2004, and I see that the 2006 EPC for that period is about 22% lower than the 2004 EPC was. (eCPM is down by a similar figure; CTR is unchanged.) This isn't especially surprising, because over the past two years I've added a lot of in-depth editorial coverage of destinations that don't yield high EPCs. Plus, I've made some changes to my site that have resulted in a huge increase in affiliate bookings, so it's possible that my affiliate partners are getting the lion's share of prospects who are more interested in booking than in looking.

Also, AdSense has been offering separate bidding for the search and content networks since January of this year, and it's likely that the change has affected EPC.

[hunderdown]

Hmm. Compared to this month two years ago:

Impressions: up by 50% (more pages w/AdSense, more traffic)

Clicks: 4 X as many

CTR: 2.5 X what it was

EPC: Down slightly, maybe 12-15%

Earnings: More than tripled

I'm intrigued by the increase in CTR. That's due partly to my having added an AdLink on one page that gets a great CTR and a lot of impression, partly to having increased CTR on the bulk of my pages. Is it also due to a larger and more varied ad inventory, better ad targeting, or some other factor that has made it more likely that a visitor will see an ad that interests them?

[edited by: hunderdown at 7:18 pm (utc) on Mar. 27, 2006]

[jomaxx]

Obviously the example in the first post -- 5 to 10 cents a click moving up to over a dollar -- is either an atypical field or more likely a simple exaggeration. The PPC market was already mature well before 2004, and I haven't noticed any wild swings since. You'd be better off asking in the AdWords forum whether clicks have gotten that much more expensive since then, but I doubt it.

[alika]

Comparing March 1-26, 2005 to same period in 2006

Page impressions = 11% increase
Clicks = 47% increase
Page CTR = 33% increase
Page eCPM = 81% increase
Earnings = 101% increase

For only small increase in traffic, our revenues doubled.

[hunderdown]

alika, what about EPC?

[jetteroheller]

Meaningful comparisons between 2003 and 2006 are difficult, because few Web sites stand still.

I developt my main site 1997.

It turned out this domain has extrem stable traffic over all the years. But as it was my first big site, it was difficult to add content.

Because of this difficulties to add new content, I started 2002 to create the first theme oriented sub domain.

So it happened that my main domain is practicall the same since 1997.

2000 major layout change

2004 June first AdSense month
$3.33 a day
2004 September, more than one ad supported by AdSense
$5.07 a day
2005 March I optimized much in February: blend in, fill URL filter list and Google introduced AdLinks
$9.43 a day
2005 November improved ad placement, it was the last domain where I switched to my current 120x90 AdLink plus 300x250 standard in the navigation. The reason for the late change had been the work to rearrange the menu items.
$17.78 a day

I optimized much, Google optimized much, the combined effort brought more than 5 times the revenues at the same old site.

[alika]

EPC increased by 37%

Page impressions = 11% increase
Clicks = 47% increase
Page CTR = 33% increase
Page eCPM = 81% increase
Earnings = 101% increase

I added new sections of the website - this is a multi-topic website targeting a specific target audience. Obviously it worked.