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I reviewed all the documentation for the site targetted cpm ads and still couldn't figure why cpm was so low on my site.
But now I think I know why CPM ads seem to not work on my site...
Say I have a page that gets a page CPM of $10.
On this page i have a 280x336 ad block and a two-ad unit vertical block in the margin of the page. And a adlink somewhere on the page
I am getting targetted CPM ads paying around $1.50 to $2.00 cpm
I think google is counting up all the individual ad units (about 6 + something for the adlinks) and dividing that number into my $10 page cpm (10/6=$1.67) getting an Ad Unit CPM.
Google displays CPM targeted ads if they bid anywhere near $1.67
I lose $8.33 on every 1000 page views.
To prove my point, I removed everything except the 4-adunit block. Within a few hours all CPM targeted ads stop showing.
For example, the reports show a much higher avg CPM for the site-targeted individual ads, yet earnings go down when they are shown in higher quantity. I recall reading somewhere that SUPPOSEDLY G treats each ad block as a separate entity when determining which ads to place there (as opposed to the entire pgae). My pure guess is there is an accidental miscalculation in the algo which allows a full block site targeted ad (say a 300x250 graphic) paying $15.00 cpm to display in a block in preferrence over 4 individual ad units with avg ecpms of $5.00 each (for a total of $20.00 eCPM for the block). This theoretically results in 25% less earnings. This becomes apparent when displaying the per channel, individual ads report, split into site targeted vs content. The 'bug' also may not happen unless you have channel targeting set up as well and receive a lot of full-size graphics, as I mostly noticed it after that started. In this example a single whole block CPM targeted ad should not be allowed to display unless it's cpm exceeds $20.00 - all other factors being equal.
Of course without more details on what size and types of ads are being shown as site targeted it is tough to debug their software for them.
As far as the opening post, I would truly hope G is using ONLY the individual ad block CPM history to calculate which ads to display there and NOT using the entire page CPM to calculate! If this were the case, it would mean you should immediately get rid of all but your best producing ad block on the page, as a poorly producing 4 block ad in an out of the way spot could seriously drop your earnings. Although I hadn't though of it and this might explain some other things I've beem seeing.
[edited by: MikeNoLastName at 9:42 pm (utc) on Mar. 26, 2007]