Forum Moderators: martinibuster
Since the latest adsense algo took effect (late November) my CTR has hit an all time high yet my CPM is at an all time low - decreasing my bottomline by 50% of what is was for the last six month.
So my question is? How do these figures translate for publisher and what should I aim for to increase my bottomline?
First thing you need to do is make sure you REALLY understand what these things are, and how they are related. They aren't complicated.
Here's the basic equation:
EPC x CTR x 1000 = eCPM
What this does is tell you what you earn (the "e") per thousand impressions.
Example: What's your eCPM if you have a 5% CTR and a 25 cent EPC? Be sure to write the numbers as decimals. So you get:
$.25 x .05 x 1000 = $12.50
What if your CTR goes up to 10% but eCPM goes down to, say, $10.00? Then your EPC must have gone down:
EPC x .10 x 1000 = $10.00
When you solve for EPC, you find that it's dropped to 10 cents!
Keep in mind, though, that eCPM is mostly useful for comparison purposes--to compare sites, or this month versus last month. But it's not a good bottom line measure.
If, for example, you have pages with low CTRs and pages with somewhat higher CTRs, and you remove the Adsense code from the low CTR pages, then your eCPM will increase, because your CTR will go up. But your earnings most likely will go down (with a possible smart pricing-related exception, but I don't want to get into that).
Actual earnings are your eCPM times the number of impressions in thousands. So removing ads from pages will reduce the number of impressions and thus clicks. An example: 4% of 5,000 is 200. 6% of 2,000 is 120. A 6% CTR will give you a higher eCPM, but also considerably fewer clicks, and so probably lower earnings.
SO. To increase your bottom line, you need to increase your earnings. There are exactly three possible ways to do that:
Increase traffic
Increase EPC
Increase CTR
Of course, you have to do these things in a way that doesn't reduce one of the other factors.
Hope this helps. Or maybe it's too basic?
Try to send the advertisers more targeted traffic.
Which will mean less CTR.
When you try to optimize your income you look at the cash, not at any of the other the stats. Your only choice left is long term vs. short term profits. I've been goign for long term for years now.
Everything on my sites (except for adding more content NOT more ads)in the last 30 days is due to being hit hard with these "new" ugly stats.
Here is an example of what has happened (not exact figures just examples)
CPM dropped from $7.50.00 to $2.50
CTR now 4.50% from an average of 2.75% over the last six months
Would suggest removing more ads from my pages (I only ever have one block ads per page - and certainly not ads on every one of my 300+ pages) or should I opt out from "advertise on this site"
