Forum Moderators: martinibuster
As I said earlier in this thread, Google may have made changes that have affected some publishers, but if that's the case, simply complaining that you've been hit is a waste of time. It would be more useful to figure out what the affected publishers have in common.
Is it possible, for example, that a "quality score" (a la the landing-page quality score on the AdWords side) has been introduced?
Or is it possible that Google has figured out, at long last, that publishers who run the maximum number of allowable ads on a page need Google more than Google needs them, and that they can be paid less than publishers who aren't so dependent on AdSense?
Or is it possible that the smart-pricing formula has been given a tweak?
The only thing we can say for certain is that a substantial drop in eCPM during November has not been a universal phenomenon, so if you simply parrot the "Google has cut the publisher payout" mantra that unhappy AdSense publishers have been reciting for years, you're just venting when you could be trying to find an answer to the question of "Why have I been affected?"
There's one flaw in the "Google slashed pay across the board" argument: Not everyone is seeing that effect.
Brown noses never do.
Also, have you considered the possibility that any changes wrought by the "maintenance weekend" may have been aimed at certain types of content or publishers?
This is precisely what these various threads have been seeking to ascertain, is there any commonality between those affected?
It would not appear so, we are all from diverse industries/trades/whatever and, those of us who have been affected, have been affected in precisely the same way, i.e an immediate 50% drop in earnings with various levels of recovery and some, apparently, finding ot even worse.
Considering my sites have been around since the early 90's and easily the #1 authority sites for my widgets, it is not as though they have been built for AdSense however what is so striking about The Glitch is this:
Post Glitch CTR v Pre Glitch Jan-Oct -23.46%
Nov 1-15 2007 v Nov 1-15 2006 CTR -29%
Post Glitch Average Daily Earnings v Pre Glitch -42.46%
I feel sure even you would agree EFV that these are HUGE decreases yet no one has been able to come up with a plausible reason as to why this has happened other than the maintenance weekend.
Interestingly my EPC average this week is now at the bottom end of my usual range with some channels EPC absolutley normal, however this huge reduction in CTR is the puzzle for me.
Google really needs to tell us what it is they have done to affect us so badly whilst not affecting others, and I can assure you it is not only the WebmasterWorld forum posters that have seen precisely the same, there are many other forums with posters having witnessed this effect.
Sometimes I have the feeling of listening to a broken record. istening to a broken record. istening to a broken record. istening to a broken record. istening to a broken record. ...
It amazes me that some here come up with weird theories about "natural market behaviour in auction based systems", "quality scores for publishers", and the like, but still refuse to accept the possibility of Google simply taking a bigger share of the click-pie.
But why a bigger share of only some people's pie?
If you've been affected, what is it about your site or sites that makes you vulnerable? Why are you less valuable to Google than the publishers who didn't see a big drop this month?
In a forum where most members are anonymous and don't include URLs in their profiles, it's nearly impossible to make informed judgments of what might or might not be happening. Maybe some of the affected publishers would like to privately share information about their sites with Martinibuster, who (in my opinion) can be trusted to be discreet. It would be interesting to hear Martinibuster's thoughts on any pattern that might emerge.
My statistician husband added his two cents.
Conclusion:
The decline has in earnings per click has been gradual, and spread out over the year, taking seasonal effects in consideration. The decline became more dramatic in September, perhaps coincidentally, just after the subprime mortgage debacle started breaking loose.
I am usually a cynic. Yes I have considered the possibility of Google becoming more greedy. I have considered the possibility of a economic downturn to which online advertising might be especially sensitive, the fact that a lot of advertisers are bricks and mortars business and therefore not growing at the same rate as internet pages, etc.
Whatever the cause. It was gradual.
I don't see a sharp change. Maybe the brain perceives it that way, but when you see it on the charts, it's definitely gradual. If Google is taking a bigger share, they didn't push a button, they slowly turned the knob.
Maybe it hasn't affected the travel industry YET. Give it a year, you will suffer as the rest of us are, right now. People won't travel so much as fuel prices rise and their houses are foreclosed.
I have concluded that the economy is the cause of all this.
I am in in for the long run, adding more content. When the economy recovers in 5 years, I'll be all set up to take advantage of the fairer weather.
But why a bigger share of only some people's pie?
I completely agree with your question and this did seem to be MY possible issue straight after The Glitch however MY issue is now why my CTR has dropped by more than 23% and, obviously, this affects my eCPM to the same degree.
As I wrote earlier, my average EPC has now returned to the botom end of its usual range but I do have channels where the EPC is absolutely normal.
On the other hand when I look at Core Site 1 I see this:
Earnings post glitch -48.15%
CTR post glitch -15.3%
Clicks post glitch -19.57%
I know you can't give me/us the answer EFV and it's helpful for you to throw some ideas for us to consider however I cannot see what I have possibly done to deserve such a whacking.
I haven't changed anything with site structure etc in years and with only 1 x Leaderboard and 1 x AdLink unit I can't be accused of over-advertising.
Why would Core Site 2's EPC be back to normal when Core Site 1's has been drastically reduced.
Is Google jealous of my success and wants to keep more of it for themselves? Hey, only chucking out raw meat...:-)
But why a bigger share of only some people's pie?
But I'm inclined to believe it's just a bug that's not getting fixed because it has turned out to be a profitable bug--serendipity. Google's response to this is consistent with their cold-hearted responses to devastating glitches on the search side.
But why a bigger share of only some people's pie?
Why not? It would be easy for Google to target small-sized publishers. They might think - "hmmm, they really seem to DEPEND on us. During A/B tests they have been accepting serious cuts and still have not reduced the traffic/click volume".
If you've been affected, what is it about your site or sites that makes you vulnerable? Why are you less valuable to Google than the publishers who didn't see a big drop this month?
Why my site is "vulnerable"?
Honestly, I can't tell. Google simply does not give me enough information to even perform the most basic analysis. I don't know which ads show (reliable, that is). I don't know what each ad/click pays. I can't block more than 200 URLs.
As I have changed very little on the general concept of my sites, I have to assume that the fact that I am small and unimportant to big Google makes me vulnerable. They simply can get away with cutting the prices. THAT makes me vulnerable. I am kept in the dark. THAT makes me vulnerable. I am too honest to become a blackhat. THAT makes me vulnerable. There is no serious competition. THAT makes me vulnerable. I do not have enough information. THAT makes me vulnerable.
We will probably never agree on this. ;-)
Why would Core Site 2's EPC be back to normal when Core Site 1's has been drastically reduced.
Are there any obvious differences between the two sites in terms of traffic, type of content, audience and likelihood of conversion, etc.? In other words, what do the two core sites not have in common?
In other words, what do the two core sites not have in common?
Core Site 1 is the widget trade's International directory.
Core Site 2 is our International core widget supply site.
And wouldn't you just know it? Today's EPC on Core Site 1 is smack bang in the middle of its pre-Glitch yearly average!
What did you do EFV? :-))
Or is it possible that Google has figured out, at long last, that publishers who run the maximum number of allowable ads on a page need Google more than Google needs them,
EFV, do you know for a fact the sites that have been hit run a max. number of ads? No, you don't, as that is completely untrue. In several cases I looked at they only run one ad and no it isn't disguised as content.
I find it hard to believe that Google would find the number of Adsense ads were relevant. Do you believe they would actually rather see a site with 3 AdSense spots or one AdSense spot and a bunch of affiliate ads/links on each page? Your logic is not only flawed, it's simply untrue.
I'm not claiming to know the answer, but I also don't post information as fact when I have no idea.
"Possibilities" means just that: "possibilities." It doesn't mean "facts" or even "probabilities."
I have no idea why some publishers have seen big drops in November and some publishers haven't. Neither do you, and neither does anyone else on this forum (except possibly AdSenseAdvisor, although I'd guess that ASA isn't any more privy to the compensation scheme's inner workings than we are).
There seems to be several things in play and not everyone is seeing the same things. Everyone except a couple industries have seen anomalies in their AdSense stats except those in the travel or related industries (villa rentals, car rentals, hotels, etc.). My belief is the travel industries will be hit last as people continue to bid high/higher even though the number of sales will shrink as the economy tightens. They are more willing to pay even more for the eyeballs as they eyeballs pointed towards travel becomes fewer.
Some of what is being seen "could" be attributed to the economy here in the USA.
Sites are still seeing traffic, but CTR, ECPM, and daily earnings are way down. People are not ready to purchase, commit, or take that extra step to click to compare values. They are still entertaining the thought of purchasing the item or service, but simply are not going that extra step, as they know it's out of reach at this time.
Some "could" be attributed to Google updates - they simply are not getting the traffic they were a month ago, though they usually do not see a slowdown at this time of year. CTR and ECPM seem ok, but of course earnings are down.
Some sites are still ranking the same, so it almost makes you think people are not searching those terms and could be tied to the economy once again.
Some sites see anomalies in the reporting. The EPC is fine, page views seem OK, daily earnings seem OK, but CTR and ECPM seem way down. Does AdSense have a glitch in the reporting?
We have not discussed one single site that has seen EPC fall "dramatically", so there seems to be other things in play on every site.
I don't believe Google is keeping more or you would see a dramatic reduction in EPC. I happen to fall into the EPC is fine, page views seem OK, daily earnings seem OK, but CTR and ECPM seem way down. Is this simply something that changed in reporting…it doesn't make sense, but not sure why daily earnings seem normal to number of clicks, yet CTR and ECPM is halved (makes you think you should be earning twice as much).
What we saw over the last year was that CTR for AdSense for Content as a whole has consistently and steadily declined during 2007, leading me to believe that AdSense 'blindness' is an increasing problem. This is across tens of millions of keywords and 50+ major advertisers so it's as good a market snapshot as any.
Also, the reason we only spend 4% of our clients' search $$ on AdSense is that it very rarely converts at a level consistent with our clients' ROI goals & constraints. I think, however, that AdSense for Content gets ~15% of Google's total revenue, meaning there's a huge gaping maw of a canyon between what advertisers are currently spending on AdSense and the long-term value of that traffic. This comes as no surprise to me, knowing the extent to which most advertisers still aren't tracking the way they should, and knowing the lenghts to which Google (and even many agencies) go to position contextual traffic as more valuable than it is.
In other words, the AdSense for Content market is at once both profoundly overvalued and its inventory increasingly ignored by Internet users. Because of those trends, I think that it's more than unlikely that the eCPM decline publishers are seeing *suddenly* since 10/19 is due to either market factors and/or a change in Google's view of these publishers traffic quality.
Why do I say that? Google has had sufficient data to make a quality score judgement on AdSense publishers' traffic for eons now, so unless they're glaringly late to addressing AdSense traffic quality (unlikely in my view), this is an effort by Google to continue managing down its overall TAC (traffic acquisition costs) rate.
It's worth stating that, despite their lack of financial guidance, Google clearly is managing their business in order to continuously improve key metrics, one of the most important of those being TAC. Case in point: G's TAC rate has steadily declined over the past 8 quarters, from 33% to 29% of total revenues. As a % of network revenues, however, TAC has risen from 78.7% Q4 '05 to 84.1% Q3 '07, with only 2 slight blips in the other direction (Q4 '05 to Q1 '06 and Q2 '07 to Q3 '07).
How do they do this? Well, it's not easy. Key search and distribution partners like AOL, Ask, Orange and MySpace hold most of the cards in negotiations and by most accounts are getting 90%+ revshares with Google. So on the one hand you have the most important Google distribution partners getting revshares way higher than Google's overall TAC rate. Yet Google's overall TAC rate declines quarter after quarter.
How?
Google gets a higher & higher percentage of its overall traffic from its own sites, a trend uninterrupted for at least 8 quarters; Google site traffic has gone from 57% to 65% of revenues over the past 8 quarters, in relatively steady. This, IMO, is not by accident and is being actively managed by Google as well.
My theory is that the AdSense publishers seeing lower eCPMs are being 'sacrificed' in order to make up for very high revshare deals Google has engaged in over the past year (Orange, Ask re-up, MySpace, etc). Because this is active mgmt of its business on Google's part, and because macroeconomic forces render even G's forecasting speculative at best, G's doing in one fell swoop what it needs to to manage to its financial goals.
Why just some AdSense publishers and not all? Ask yourself this: if this is, in fact, Google managing its financials closely and in reaction to changing big-publisher deals and macro environment, would market forces be more plausible of an explanation if all AdSense publishers were equally affected? I think not. Google knows that a non-equal impact among AdSense publishers will be viewed as some sort of quality-based or market-force-based effect, whereas -27.5% eCPM across the board would be laughably transparent.
Now that I've run out of wind, I wait with heartfelt longing for what will undoubtedly be ridicule of my theory from EFV, adamant adherence to the idea that laissez-faire capitalism and 100% efficient market forces control Google more than Google does itself, and if I'm lucky maybe, just maybe a 'conspiracy theorist' aspersion.
My theory is that the AdSense publishers seeing lower eCPMs are being 'sacrificed' in order to make up for very high revshare deals Google
But that would be seen in earnings per click. If Google was keeping more they would simply lower the amount paid per click to the publisher...at least in my opinion.
Still the puzzle remains regarding my/our dramatic CTR reductions?
How have they been able to do this to some and not to others?
The Contractor
CTR and ECPM seem ok, but of course earnings are down.
Only this week can I say that my EPC has returned to normal, during the first week I thought I was going to go down to 0.00 per click the fall was that huge and this from a yearly average of more than 0.30.
Given your experience, I do not fear that you can be easily convinced by those sounding like a broken record ("supply and demand", "site quality", etc). Unfortunately, I do not have the same wealth of data that you had, but I am seeing some very strange patterns in my data. But the fact that there are patterns gives me hope. Hope to de-mystify the Adsense program.
Why just some AdSense publishers and not all? Ask yourself this: if this is, in fact, Google managing its financials closely and in reaction to changing big-publisher deals and macro environment, would market forces be more plausible of an explanation if all AdSense publishers were equally affected? I think not. Google knows that a non-equal impact among AdSense publishers will be viewed as some sort of quality-based or market-force-based effect, whereas -27.5% eCPM across the board would be laughably transparent.
I've said repeatedly that Google may well have different payouts for different publishers, even at the mom-and-pop level.
And why not? Let's say, just for the sake of discussion, that site A averages 5 page views per visit and gets 50% of its traffic from Google Search, while site B averages 1 page view per visit and gets 90% of its traffic from Google Search.
Site A is clearly adding more value to the Google/publisher relationship than site B is, so it wouldn't be unreasonable if (and note that I say if) Google paid a higher percentage for clicks from site A than for clicks from site B (where the publisher's site is little more than a secondary filter to capture users who didn't click on Google AdWords in the SERPs).
Evolution happens, and some species do worse than others when change occurs. Google may well have tweaked its revenue-sharing formula, but that doesn't mean other factors may be at work, too: such the much-ballyhooed drop in the value of the U.S. dollar, the November doldrums in some sectors, Google's introduction of site-targeted AdSense CPC ads, etc. If you're unlucky enough to be a victim of several different negative factors at the same time, you may be experiencing a "perfect storm" that's having a Hurricane Katrina effect on your earnings.
I'll only add that looking at two years worth of data, my EPC has declined as well. Traffic up, earnings down, all across the board.
Site A is clearly adding more value to the Google/publisher relationship than site B is, so it wouldn't be unreasonable if (and note that I say if) Google paid a higher percentage for clicks from site A than for clicks from site B (where the publisher's site is little more than a secondary filter to capture users who didn't click on Google AdWords in the SERPs).
Good job you got your "if" in there:-))
I actually average somewhere about 3 PPV since when people search for "widget 1", I'm #1 and they come straight to me for that info, learn what they need to and disappear. Searchers for my products globally know precisely what they're looking for.
I have several single page parked splash domains at the moment and they do have completely relevant content for their subject, their EPC is generally the highest I have which, I feel, puts your "if" idea to one side since these would surely be the lower paying whereas they are clearly not.
Keep bringing on the ideas since we've run out of them!
PS: I am getting great ads again, and still same low ctr and ecpm so something must be going on, believe it or not.
Getting back to the topic at hand, it wouldn't surprise me one bit if Google has introduced a "quality score" component (not unlike the one on the AdWords side) that's designed to incent certain types of content or behavior at the expense of others. On the AdWords side, Google has to acknowledge the existence of such scoring (since it has an immediate and sharp impact on minimum bids), but on the publisher side, there's no need for Google to say anything, and indeed Google would be foolish if it did explain what it was doing and why.
Hypothetical case in point: Let's say, just for the sake of speculation and discussion, that Google decided to pay a higher percentage for clicks from certain types of content than from others. Why would Google want to say, for example, "We're now paying more for clicks from articles than from sparsely populated directory pages"? That would just encourage publishers of skimpy directory pages to crank out junk articles. It would be much smarter for Google to quietly change its compensation formula and let evolution and the marketplace weed out "thin directory" sites over time.
Again, it's entirely possible that nothing has changed, and that major drops in eCPM aren't nearly as widespread as some people here claim they are. It's also possible that something has changed--but if changes in the compensation formula, smart pricing, ad allocation, or something else have occurred, it doesn't follow that Google is picking every other publisher's pocket so it can pay more to THE NEW YORK TIMES. And questioning the motives of Google or the people who don't share your conspiracy theories won't help you reverse your decline in AdSense eCPM.
One other thing I forgot to mention in my earlier post. During Google's most recent [Q3] earnings call, there was a great Q&A that bears directly on our discussion:
Justin Post of Merrill Lynch asks:
"Thank you. The gap between your revenue growth, 57%, and your sponsored click growth, has been maintained around 12%. Could you talk about the drivers there, where you are in your monetization cycle? Do you have a pretty good pipeline of things coming forward?
[Shorebreak - rest of question cut as it's not relevant to our discussion]
Jonathan Rosenberg (head of AdWords) replies:
"I can maybe cover some of the monetization issues. We are certainly very happy with the product upside that we achieved this quarter. It was really -- it really came out of over 20 quality and UI improvements that we launched.
There were two very big things that we’ve talked about publicly [Shorebreak - meaning that they *didn't* talk about 18 of 20 changes made that had an impact on monetization. So 90% of what they're doing is not revealed; certainly there are legitimate reasons for not revealing all changes, but it's equally reasonable, even expected, that some of those changes aren't revealed in order to maintain good relations with Google's advertiser & publisher partners]. The first was the reserve base promotion, and actually we only launched that in late August, so it only had part of the quarter to manifest itself in terms of improvements, and that was basically the change to the formula which determines which ads are shown above the search results, so that was certainly significant.
We’ve also been doing some things like previous query based ad targeting, which is pretty significant. We’re looking at the previous query to try to figure out what to do on the next query. So we’re pretty confident that we’ve got many, many more ad quality improvements like these. [Shorebreak - note that the question from Justin is about monetization improvements, and that Jonathan ends his response by saying there are "many, many more ad quality improvements like these". I think we can all agree that he means that Google has many, many more *monetization* improvements, and G motto aside, that monetization improvements are not necessarily improvements as viewed by Adsense publishers good & bad alike.]
We’re also launching them internationally pretty expeditiously, so from that standpoint we think there is a very healthy pipeline in ads improvements."
You'd have to have your head in the sand to take this Q&A as something other than clear proof that Google actively manages its monetization in a way that almost necessarily must result in changes of the type people on this board are seeing.
'Do No Evil' is a great motto, but I tell you this: while Google management and employees drive more than their fare share of Priuses (environmental consciousness is simply their cross to bear, right?), they also have way bigger houses and decadent, luxury, gas-guzzling 2nd cars like you wouldn't believe.
They are enlightened from an engineering perspective, but 'Do No Evil' is a naive & self-righteous motto that belies the truth, which is that AdWords & AdSense are two faces of a profit-generating machine that more perfectly extracts marketing dollars from consumer intent & activity than any other system in history. This profit-generating machine is designed - yes, that's right, I said *designed* although *evolved* works equally well - to systematically increase G's revenues while concurrently decreasing TAC.
We now have almost 3 years of history of Google as a public company, and the data, IMO, leads inescapably to the conclusion that AdSense publisher eCPM (along with other metrics like % of keywords on broad vs phrase vs exact match, % of advertisers using G Analytics, etc) can , are & will be managed by Google to improve EPS quarter after quarter after quarter or until market forces overwhelm their "healthy pipeline" of monetization improvements.
Did I say "monetization improvements"? Sorry, I meant to say "ad quality improvements", yeahhhhh, that's right.
Seriously, though, putting my SEM hat back on, the data I've seen over the last 4 years gives me personally 100% confidence that the majority of AdSense publishers have been making far more than they should given the ROI value of their clicks. Perhaps that's why it appears not only reasonable but overwhelmingly likely that Google is paying many of you less, knowing full well that most of the conversions are from Google.com and AOL, not your sites bereft are true search (high-intent) activity. Finally, it helps to know that there still is no real competitive threat to AdSense, meaning G's free to do as they wish. Applied Semantics at ~$30M was quite possibly the highest-ROI acquisition any Internet company ever made.
