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75% Drop in AdSense Income

How do You Dig Yourself Out?

     
10:27 am on Oct 19, 2006 (gmt 0)

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I have never been hit by smart pricing until recently. My revenue has gone down by 75% and I cannot handle looking at my stats. All of my hard work has gone to waste.

How long does it usually take to turn around?

Thanks

10:40 am on Oct 19, 2006 (gmt 0)

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It can take a long time or even forever.

But I serendipitously found that changing the ad format might lift the filter for a while. It's like Google has to recalculate the ROI for the advertisers.

I did it a couple of times in the past. And it always seemed to work.
For now I'm just going with the flow. But I can understand that when incomes drops by 75% you want to try something.

11:06 am on Oct 19, 2006 (gmt 0)

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bts111 - when did you get hit? What sort of figures did you have before you were hit? Was it a gradual decline, or was it over-night?

Perhaps if everyone pooled a bit of information regarding figures - obviously not detailed ones to breach TOS, we coud determine a pattern and try to prevent future attacks, and try to ensure longevity for those who have not been struck down. Is there a strict pattern that it follows, or is it random. Is there a money earned cap? (although I doubt that one).

I guess the above above suggestion re ads, has got to be worth a go - after all, you've got nothing to lose, and everything to gain. I can only imagine how gutted I'd be if it happens to me - you have my sympathy.

11:27 am on Oct 19, 2006 (gmt 0)

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My site had a fairly constant EPC for about 2.5 years.

Then, this summer epc started to fall... still falling.

Now it is about 30% of 'normal'.

CTR has dropped too after 2.5 years.. ctr is down about 30%. Combine those two dropoffs in percents and you see where I'm at - it isn't pretty.

11:39 am on Oct 19, 2006 (gmt 0)

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It's weird as I know the traffic converts - I have between 50-150 affiliate sales per day and am contantly harrassed by account managers wanting me to give their programs more exposure. They may get their wish very soon.

I can see that I getting site targeted which I think is one of the main problems.

trannack - I won't go into figures but everything was very high and extremely stable.

11:57 am on Oct 19, 2006 (gmt 0)

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Did any other parameters change? Site layout, content, type of ads. Any new pages that are the sort Big G don't like - alcohol sales, pharmacy stuf..... What was the average monthly CTR pre problems? Is the bulk of your traffic organic or PPC?

Do you advertise on Yahoo, MSN? Just trying to get a bit more of an overall picture of why you guys have been hit. How many pages to you have adverts on? And the list goes on....

12:09 pm on Oct 19, 2006 (gmt 0)

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Site Layout: Nope
Content: Updated daily as per usual - I have content writers
Type of Ads: No change

No nasty pages that would be against the TOS. All traffic is organic :) Have adverts on 85% of pages.

1:07 pm on Oct 19, 2006 (gmt 0)

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Maybe it is an organic traffic issue - maybe they prefer you to be paying them some revenue - via Adwords? Could this be a pattern?
1:37 pm on Oct 19, 2006 (gmt 0)

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Not likely since my traffic (about 5k page views all search and organic links etc) has risen slowly over the last three years.
2:07 pm on Oct 19, 2006 (gmt 0)

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bts111 smartpriced 4 times in one year, and the result is almost 1000$ day to 10$ day...

Smartpricing quoted in google to help publishers earn more, its BACKWARDS!

2:32 pm on Oct 19, 2006 (gmt 0)

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Smartpricing quoted in google to help publishers earn more, its BACKWARDS!

The purpose of smart pricing isn't to make publishers richer; it's to protect advertisers (Google's customers), who won't use the content network if their budgets are being exhausted by sites that send them large numbers of non-converting clicks. (Of course, it's possible that publishers whose traffic converts will earn more than they'd earn if there were fewer advertisers in the AdSense pool, so in that respect--and that respect only--smart pricing benefits publishers.)

Here's what Google has to say about smart pricing:

[adwords.google.com...]

[adsense.blogspot.com...]

3:45 pm on Oct 19, 2006 (gmt 0)

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If site targeted ads are the problem (and it might be) then email google and request that they switch off cpm ads on your site. They can always turn them on again if you lose out by it.

I'm conducting a trial of how my site performs without them at the moment, and the results are encouraging.

5:42 pm on Oct 19, 2006 (gmt 0)

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the object is to price the site-targeted cpm garbage right off of your site... getting a bunch of it means that something is wrong.

does removing it mean that you get more psa ads? will your epc/ecpm drop back down in the long run?

>>>I have between 50-150 affiliate sales per day<<<

i'd be dumping adsense left and right, especially on the pages where channels have told you that it's a dead duck.

5:49 pm on Oct 19, 2006 (gmt 0)

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If the site is doing extremely well with affiliate sales, maybe the hot prospects are using the affiliate links and the people who click on ads are mostly non-purchasers.

I doubt if the problem is as simple as having site-targeted ads, because (according to Google) those aren't served if CPC ads are likely to perform better on a given page at a given point in time.

7:01 pm on Oct 19, 2006 (gmt 0)

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Google's standard spiel simply does not apply in many cases, and should be taken with a pinch of salt most of the time.

The only way to find out if cpm is a problem or not is to have them remove it and see. Since removal of cpm, my main earning channel as nearly doubled it's ecpm and overall epc is the best it's been for a while.

We know that the algorithms don't perform that well, and often don't produce the results Google think they will. I know that ideally they would like it to be the case that their technology was capable of serving the ads that give the maximum earnings, but sadly on so many occasions it fails to do this.

7:47 pm on Oct 19, 2006 (gmt 0)

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btw, dropping from 1000 dollars to 10 dollars a day...? How many clicks did you use to have then and how many do you have now?

I need at least 200 clicks in order to reach 25 to 30 dollar so I guess the value per clicks dropped alot for you then?

9:50 pm on Oct 19, 2006 (gmt 0)

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As it has been suggested... change your AdSense code every now and then to make the bot come and look at your page. It helps.

Mike

2:02 am on Oct 20, 2006 (gmt 0)

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My gut feel is that somathing is wrong with the whole smart pricing thing.

How can GG be sure that adwords advertisers are acurately tracking thier ROI?
What motivation does a advertiser have to report accurately?
Are we sure GG is not just taking a larger share?

We may never know...

For now, I'll keep pushing YPN with gg playing a minor role on my site.

2:27 am on Oct 20, 2006 (gmt 0)

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How can GG be sure that adwords advertisers are acurately tracking thier ROI? What motivation does a advertiser have to report accurately?

Google has never said that smart pricing is based on individual advertisers' conversion tracking. (In fact, what Google has said suggests the contrary.)

Are we sure GG is not just taking a larger share?

You can follow Google's quarterly earnings reports.

2:56 am on Oct 20, 2006 (gmt 0)

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>>>Are we sure GG is not just taking a larger share?<<<

since the google quarterly reports do show increased profits for google in q3, you could very well be right, and no one out here can prove otherwise.

google does not split up their earnings report based on content publishers vs. premium partners, and there is no way to know how many of either party are in the adsense program... more partners than last year, or less? more international partners and fewer domestic partners? google does not tell us that.

what we do know is that premium partners often get paid differently than we do; in some cases, they get to keep 100% of the ad income... how would you like to keep google's share of your adsense clicks?

3:15 am on Oct 20, 2006 (gmt 0)

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Before making too many assumptions about premium publishers, it might be worth reading rbacal's comments in this thread:

[webmasterworld.com...]

[edited by: jatar_k at 3:51 pm (utc) on Oct. 20, 2006]
[edit reason] fixed link [/edit]

4:44 pm on Oct 20, 2006 (gmt 0)

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"A lot of media companies, such as the New York Times feature Google ads prominently on their online sites. In some cases Google hands over as much as 100 per cent of the revenues to key partners. It does this to gain distribution and it is also able to grab the customer relationship through its "advertise on this site" feature."
-Tom Foremski, silicon valley watcher, january 2006
5:06 pm on Oct 20, 2006 (gmt 0)

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Whatever deal Google might have with THE NEW YORK TIMES isn't likely to be responsible for the "dark hole".

[edited by: jatar_k at 5:13 pm (utc) on Oct. 20, 2006]

6:45 pm on Oct 20, 2006 (gmt 0)

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"...according to Marc Leibowitz, director of strategic partnerships at Google...As a rule, Google pays out 50 cents of every dollar to partners—and can range up to the full dollar, depending on the size of the relationship, according to Leibowitz.
- [foliomag.com...] 12-2005

"Google admits this competition will squeeze its margins. On March 7, in a Form 8 filing, Google said revenue would grow from $6 billion this year to $9.5 billion next year, based purely on trends in traffic and monetization growth. “But strong competitors are attempting to aggregate traffic. AdSense margins will be squeezed in 2006 and beyond,” the company said.
-http://360techblog.com/2006/06/21/the-adsense-quality-conundrum/

so is it really "smart pricing", or is google keeping more for itself?

7:57 pm on Oct 20, 2006 (gmt 0)

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The topic of Google's AdSense margins really belongs in the GOOG forum, but it's worth pointing out that Google's share of the PPC advertising market increased in the 3rd quarter, as did total revenues.

Every quarter, a small number of WW members make dire predictions about advertisers deserting Google, and the next quarterly report proves them wrong.

Still, the real issue in this thread is why some publishers are seeing massive drops in their earnings. Smart pricing is likely to be one reason; another may be supply and demand in their sectors or for their specific keywords. Even if the number of advertisers for "widgets" increases by, say, 25%, there's going to be a shortage of high-paying clicks if the number of publishers' pages containing AdSense ads for "widgets" increases by 50%, 75%, or 100%.

More food for thought:

The mix of advertisers may also change over time, especially for topics that generate large numbers of junk clicks. If an advertiser for "fuzzy widgets" is seeing a decline in ROI because made-for-AdSense pages about fuzzy widgets are proliferating, that advertiser may bid less or pull out of the content network altogether. (Whether junk traffic is a problem, and whether advertisers pull out of the content network, will obviously vary by sector and keywords.)

Finally, advertisers in some sectors do have other options. One of the big research firms predicted a few months ago that revenue growth for display ads will outstrip revenue growth for text ads over the next few years. In one sector that I'm familiar with, for example, display ads are selling extremely well these days, and advertisers are starting to make longer-term commitments. That doesn't mean such advertisers are abandoning CPC advertising (assuming that they've used it in the past), but they're more likely to reserve it for targeted, time-sensitive promotions and cheap filler ads instead of making it the centerpiece of their online advertising plans. This could result in a softening of demand, or at least a softening of revenue growth, for CPC text ads from AdSense and other vendors.

11:47 pm on Oct 20, 2006 (gmt 0)

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adsense margins affect publisher earnings, so this is the correct forum to discuss it... here is another negative factor in publisher payout:

"GOOG has generally maintained a 50/50 split between revenue from Google sites and revenue from third-party Google network sites. But over the past year it has begun moving more ads through its own sites where it doesn’t have to share revenues with partner sites. (In (2005) Q3 revenues from Google sites grew 20 per cent as revenues from Google’s network sites grew 7 per cent.)

TAC costs in (2005) Q4 decreased "reflecting primarily the continued shift in our revenue mix from Google network revenue to Google-owned site revenue." ...It is also bad news for the many VC funded web service startups whose revenue models are based on being honey pots for Google AdSense clicks."
-http://blogs.zdnet.com/Foremski/?p=35

google promoting it's own adsense sites over publisher sites continues in this latest 2006 Q3 report:
"TAC as a percentage of advertising revenues fell to 31 percent in the third quarter from 34 percent a year ago, a slight dip from 32 percent in the second quarter. That number shows more of Google's revenue coming from sites it owns."
-http://www.clickz.com/showPage.html?page=3623739

7:47 am on Oct 21, 2006 (gmt 0)

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I think I also got hit. On October 19 it my earnings went down 10%. Yesterday (October 20) my earnings dropped 60%. I also noticed a decrease in traffic.

What's going on?

10:25 pm on Oct 31, 2006 (gmt 0)

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So what triggers smart pricing?

I've read all the info Google offers, emailed back and forth with them and read the threads here, there and everywhere else, but I still have no idea what's up.

In my experience with AdSense (several years), it seems like every time we build revenues up, they take a corresponding sudden drop.

Most recently we made some changes to ad unit, colors used and ad placement on a particular site in an effort to increase a low CTR.
Overnight the CTR went up as planned - by 400%! eCPM also went up, but unfortunately, EPC was cut in half.

The site is earning more sure, but it feels a lot like the drop in EPC was a direct result of the increase in CTR, though I've seen other mentions of drops around the same time (Sept 18), so maybe it's something else entirely...

Anyway, enough rambling. Time to get back to work.

7:19 am on Nov 1, 2006 (gmt 0)

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There is one absolutely vital aspect of pie sharing that never gets mentioned in all of these discussions.

It's always assumed that as the payout share is fairly stable, the fact that earnings have gone down must be "Your fault". The factor that's missing is that there is ONLY one pie, and the more people that want a piece of it, the less we all get. So by the time you've added in all the greedy arbitrage players on the take, most of us will suffer as a result.

Is the fact our income has dived as a result of there being less pie the fault of publishers? Well, in some cases that's bound to be true. But in many others the reason is bound to be simply that there is a lot less pie per person due to the mushrooming number of publishers - many of them arbitrageurs.

There is a tendancy amongst certain prolific posters here to make out of hand assumptions that if someone is earning less, then it's their fault and they shouldn't whine. I don't think that this is acceptable, and that that when people come here to discuss constantly lowering earnings there should at least be some recognition made that the loss of income is not necessarily as a result of anything they have done - just the fact there is less pie per person nowadays. It should be the goal of the forum to help publishers increase their share of the pie - not assume some failure on their part.

7:41 am on Nov 1, 2006 (gmt 0)

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How long does it usually take to turn around?

It takes however long you delay looking for an alternative method to monetize your site.

This 110 message thread spans 4 pages: 110