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"Great news! My EPC has dropped!"

         

europeforvisitors

3:31 pm on Feb 6, 2004 (gmt 0)



We often see complaints here about falling EPC (earnings per click), often accompanied by speculation that Google has slashed payouts to publishers.

But think about this: In some cases, falling EPC numbers may represent success and growth.

To see whether that's true in your case, compare your effective CPM over time.

On my own site, for example, EPC in February is about 20% lower than it was last July, but my effective CPM (revenue per 1,000 impressions) has grown by more than 40%. Why? Probably because AdSense has a larger and more diverse pool of advertisers than it did last summer. In other words, I'm now getting clicks from targeted ads on pages about subtopics that were displaying only "default ads" six months ago. Those clicks on lower-bid ads have reduced my average EPC, but they're boosted my effective CPM and overall revenue.

Moral: When comparing numbers, look at the overall picture--and especially at your bottom line.

wgonz

4:15 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



Congratulations! And thanks to share that information.

I believe that I am experiencing similar changes in my websites. BTW; with "effective CPM" are you talking about (income*1000/( Paid Ad impressions))?
I understand that the impressions of AdSense Stat include both, alternates ads, and paid ads.

Wilmer

CPCretirement

4:20 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



I wish I could share in an increase in CPM. Unfortunately my EPC and CPM have both dropped. Not enough to justify replacing the adsense ads, but significantly.

The additional CPM provided by Adsense still blows away any general ad program. Selling direct (which is the majority of my revenue) is the only way to beat it.

europeforvisitors

4:24 pm on Feb 6, 2004 (gmt 0)



By "effective CPM" (which could be described more accurately as "revenue per 1,000 impressions), I simply mean revenue divided by total AdSense impressions (in units of 1,000), e.g.:

$1,000 divided by 100,000 impressions would be:

$1,000 / 100 = $10 effective CPM

hooloovoo22

4:32 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



the only way for this to be true is for your clickthrough rate % to have risen...correct?

richmondsteve

5:29 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



Wearing my glass half full hat, there's another reason that a declining EPC might not be bad. Ignoring advertisers that don't know how to track ROI and new advertisers, long-term advertiser CPC has to be low enough to achieve an adequate ROI.

Obviously CPC isn't the only lever that can affect ROI, but it's a big one and many advertisers focus on it. I have an informational site with a very specific focus. Through July there were 10-20 main advertisers, all offering services in a similar price range. Based on my EPC, information gathered from Adwords bidding rates and what I knew about these companies' conversion rates, it was apparent to me that something had to give. EPC was 3-4 times what it is now and there are now only 4 main advertisers (though some only opted-out of content site advertising), but CTR is higher due in part to better written ad copy and the CPC appears to have settled in a range that makes content-site advertising profitable to these companies.

Everything else being equal I'd prefer the EPC I saw in late June and most of July, but the CPC either needs to be low enough for advertisers to generate an adequate ROI or there needs to be continuous flow of new companies advertising and companies who don't (or can't) calculate ROI to keep the EPC artificially high. Since I don't think banking on ignorant and naive advertisers is prudent, I'm comfortable with the much lower EPC and effective CPM range that my site has settled into the last few months.

The initial high CPC also led to an explosion of inferior sites and sites created just for AdSense which competed with mine for AdSense impressions and clogged the Google SERPs with lots of low-quality redundant page which ensured my pages were lost in a sea of junk. I've definitely noticed a steady improvement over the last 2 months.

YMMV.

Chndru

9:07 pm on Feb 6, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



the only way for this to be true is for your clickthrough rate % to have risen...correct?

hooloovoo22, right on nail, provided the impressions are the same in both cases.

of all the statistical mirages, $ earned is the only true reflector

Visi

10:52 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



Call me greedy, but the improvements I have made to increase CTR (and gross clicks) should not be offset by declining EPC. Especially true due to high increase in traffic that has been obtained over the last 6 months.

Revenue is not the only way to judge continuing success. Improved traffic, higher CTR is what I can control and improve to some degree. just want google to keep up their side of the equation.

jabberwookie

11:12 pm on Feb 6, 2004 (gmt 0)

10+ Year Member



Well my EPC has dropped 33% and EPM has dropped 22% in the past 30 days. I have significant traffic but I guess the market for my content has dried up.

androidtech

12:28 am on Feb 7, 2004 (gmt 0)

10+ Year Member



Visi,

But it may not be Google. You really have to think long and hard on the fact that ALL your AdSense revenues are the result of hundreds, if not thousands, of simultaneous mini-auctions going on in real-time, between AdWords bidders on various keywords (one auction for every possible keyword phrase that lands on one of your web pages, multiplied by the number of web pages you have; complicated by crossovers due to broad matching AdWords campaigns and such; further complicated by the rate of display and the selection of ads that Google decides to display on your pages. Google is definitely sending more ads to those pages that have higher traffic then to those that don't).

It's like someone trading stocks or futures and expecting a steady income.

When the day comes we all simultaneously make "my EPC has dropped" posts, with no rebuttals, we will know that the Google's pay-per-click ratio has dropped.

thx

Visi

5:21 am on Feb 7, 2004 (gmt 0)

10+ Year Member



Agree android....especially about ads to higher traffic sites...and that is one of the main issues as we see it. Overselling the availibility of ads....has been the watering down effect of most ad servers. When you start getting more and more defaults and lower paying ads, we'll see how attractive the program remains. Fact is that in 7 months the trends are going one way...and doesnt matter how you track it. Yes revenue is up for us, but result of number of visits. Down for EPC, down for revenue/visitor, and down for CPM. Those are the trends.

europeforvisitors

6:57 am on Feb 7, 2004 (gmt 0)



Yes revenue is up for us, but result of number of visits. Down for EPC, down for revenue/visitor, and down for CPM. Those are the trends.

I suspect that such trends (or the lack thereof) vary quite a bit by category, keywords, and the variety of content on the site. Even if there were an overall negative or positive trend, it wouldn't have much meaning for the individual publisher, for whom specifics are what count.

Sense_able

11:46 pm on Feb 9, 2004 (gmt 0)

10+ Year Member



Ever since Adsense came along I have devoted all my time to building.....

Build, build, build and then build some more. I have added an extra 1200 pages to my website of content that I have been meaning to do for years.

Sure my CPC had dropped, and all my other 3 letter words but my impressions keep growing and with them comes the clicks.

I would rather have 6 clicks at 10c than one at 50c

Stop analyzing and get building , if you build it they will come, google may not last forever so lets make hay while the sun shines

Need3lives

12:47 am on Feb 10, 2004 (gmt 0)

10+ Year Member



Oh, I wish this was the case!

In my case ECPC and ECPM have both dropped dramatically since first starting w/ AdSense. My current ECPMs are about 1/3 to 1/4 of what I was earning back in August/September. As a result, my overall bottom line is down about the same.

Adsense is quickly approaching the 'Should I remove it from my site?' decision time.

irock

4:00 am on Feb 10, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



europeforvisitors,

What if I tell ya my EPC and effective CPM are both dropping... what would you say?

europeforvisitors

6:01 am on Feb 10, 2004 (gmt 0)



What if I tell ya my EPC and effective CPM are both dropping... what would you say?

Well, it's possible that you're heading toward the low point in a yearly or seasonal revenue cycle. Or maybe you're in a category where there's a growing number of publishers competing for a finite number of clicks. Or maybe you have a very "sticky" audience that's seeing the same ads all the time. Or maybe advertisers have deserted your category for a variety of reasons.

Obviously, AdSense doesn't work for every publisher all of the time. For some publishers, it won't work at all. But before dumping the program, you might want to try running AdSense ads on a small number of pages over a long enough time to see if your EPC and effective CPM improve.

markus007

8:22 pm on Feb 10, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Adsense is quickly approaching the 'Should I remove it from my site?' decision time.

Same here, bussiest time of year for me now, adword prices are sky high, payouts have turned pathetic. EPC is 1/4th that of august.

jomaxx

8:58 pm on Feb 10, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Man, I wish I had been using AdSense back in August.

loanuniverse

6:35 pm on Feb 27, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Moral: When comparing numbers, look at the overall picture--and especially at your bottom line.

Well, I just realized that I surpassed my total for January earlier today, and it only took me 26.5 February days to do so.... That has to be good :D

dazzlindonna

8:37 pm on Feb 27, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



loanuniverse, same here. best month i've had yet and the month isn't even over. in fact, it's been a really NICE increase this month. its not due to a seasonal thing, and the traffic is about the same, so i assume it must be higher paying ads being clicked on.

jhood

10:13 pm on Feb 27, 2004 (gmt 0)

10+ Year Member



Europeforvisitors is right, as usual. My experience is roughly similar to his -- EPC down but CTR and traffic up and bottom-line revenue coming back up from the trough it fell into last fall.

None of this is surprising to anyone who's ever been in publishing or broadcasting. Advertising revenue is very fluid and, especially on the national and international level, responds to all kinds of market forces that an individual publisher can't discern. Get used to it, guys. It's volatile.

The one way in which this forum differs from those you would find if broadcasters and print publishers frittered away as much time as Webmasters do is this: you would never see any other branch of publishing running down its honeypot (i.e. Google and its advertisers) and whining for advertisers to throw more money down whatever dark hole is under discussion.

This business needs to shape up and get at least a little bit professional. Where is Dale Carnegie when we need him? You think advertisers don't read this forum? Everybody ought to go take a sales course and learn how to talk up the value of their chosen medium instead of trashing it.

/jh

loanuniverse

11:00 pm on Feb 27, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



so i assume it must be higher paying ads being clicked on.

I wish I could say the same, even with the hit from the Yahoo switcharoo, my traffic continues to increase, but just like the title of the thread said "My EPC dropped".

If EPC had held or increased it would have been great.

europeforvisitors

4:09 am on Feb 28, 2004 (gmt 0)



This business needs to shape up and get at least a little bit professional.

Which business is that? There are so many! For better or worse, everything on the Web gets lumped together and treated as a single medium. It's as if people in the offline world were to talk about "print" instead of distinguishing between books, periodicals, advertising brochures, direct mail, pizza flyers, telephone directories, etc. (Can you imagine a media buyer at J. Walter Thompson buying print ads without knowing if they're going to run in THE NEW YORKER, the Yellow Pages, a home-published newsletter, or in the margin of a ciruclar for a hardware store? That's essentially what advertisers are asked to accept when they bid on Web "content ads.")

loanuniverse

4:32 am on Feb 28, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



That's essentially what advertisers are asked to accept when they bid on Web "content ads.”

IMHO, the situation is similar to say one of the first television stations or the first national TV network. Google is in a position to kind of dictate the rules. First of all, I don’t think it wants to hire the people that would be needed to sell ads in each individual show. Second, it wants to have as much reach as possible.

Does this mean that they are exposed to someone inventing a “better mousetrap”? sure it does. I just don’t think it will be easy to topple them. A sizeable percentage of the web might decide to go with another vendor because they might think that Google is their competition. But those sites, are not in Google’s network now, so it is not like it will hurt them inmediately. It might syphon some ad money, but the market is expanding not contracting.

Now if they could get a couple of thousand of us to switch, then that is another story. But so far there is nothing in front of us but rumors of competing programs.

401khelp

4:00 pm on Feb 28, 2004 (gmt 0)

10+ Year Member



Watching AdSense stats over time is a fascinating spectator sport. Just when I think things have stabilized into a reasonably predictable pattern, something abruptly changes. I don’t fixate on my stats, but I do find the patterns interesting. For example, on February 7th, my CTR abruptly dropped 24% (I made no changes that would account for it), but my EPC jumped 61%. This has held now for weeks resulting in a 19.7% increase in my CPM. Some days are as good as we had back in August.

I’m I concerned that my CTR dropped? Nope, because the earnings are super and growing. This is a case of "Great news! My CTR has dropped!"

One stat I like to track is my AdSense hourly wage. I simply take my weekly AdSense earnings and divide it by the standard average America work week of 40 hours. Since many of us can relate to an hourly wage, it is an interesting value proxy. My hourly wage has never been higher.

europeforvisitors

4:11 pm on Feb 28, 2004 (gmt 0)



Since many of us can relate to an hourly wage, it is an interesting value proxy. My hourly wage has never been higher.

Yes, but the medical and pension benefits suck. :-)

401khelp

5:40 pm on Feb 28, 2004 (gmt 0)

10+ Year Member



The site is my pension, but one benefit I don't have is extented vacation time! Regular four day weekends are easy, but two weeks in Europe can't be done anymore :-(. I can still visit your website, but it just isn't the same.