Forum Moderators: martinibuster
i show text only ads. but from time to time, i enable image ads to see if some positive changes happened in the image ad inventory and in the payout.
when i looked at my stats, i selected the report on site targeted impressions per ad block. i was completely underwhelmed by the results:
8 cent per 1000 impressions on average!
looking at some references from ad agencies (which of course should be handeled with care), the average market-cpm there for the advertiser is typically a few dollars, mostly at least around ten dollars for a leaderboard. that's more than 100 times the ppm i get from 1000 impressions for an image banner on the adsense network. how can this be?
well, when you look which kind of sites successfully show site-targeted cpm ads, it becomes clearer. myspace, youtube, big media sites.. all of them so-called click monsters, that means a massive amount of page impressions compared to relatively few unique visitors.
so the average publisher with a mid-sized website with let's say around half a million ad impressions per month is peanuts against these huge social network sites.
with their massive presence they simply take away most of the network-wide ad impressions, thereby depressing the network-wide cpm for those ads to a few pennies. in fact, on those sites they typically aren't worth more. some online newspapers for example freely admit that they work on ways to inflate the number of ad impressions even more (picture galleries, fiddly navigation,..). justification: "too little online earnings". so they bring down the market cpm = worth of 1000 ad impressions even more with these tactics.
collateral damage: you as a normal publisher who offers worthwhile ad exposure with a reasonable uniques to impressions ratio also only get these few cents.
whats's foul? well, the algo seems in no way to regard the amount of unique potential customers who can be reached through a site targeting campaign.
example:
a site targeted cpm ad is shown on a clickmonster:
100 page impressions per visit = 10 million banner impressions reach 100,000 visitors.
same campaign on your website:
3 page impressions per visit = you need only 300,000 impressions to reach 100,000 visitors.
but you get the same payment per 1000 impressions. you get the idea?
one can show the same banner 100 times to an individual, but is it worth it?
the worst thing is, advertisers seem to not realize this quality gap at this point, so they don't spend more on branding exposure on better performing sites, that is sites with better reach in the proper sense plus better attentiveness of the recipients.
solution: to get this right, people/google/advertisers must take notice of the enourmus divergence in numbers of individual customers which can be reached with a certain amount of impressions. this sometimes can vary from website to website by a huge factor. this has to be taken into account in the payout formula.
pay per unique adressed visitor so to speak. otherwise, the big networks with their underperfoming visitors to impressions ratio will continue depress the cpm network-wide to the disadvantage of those publishers who offer real value for the advertisers' money.
now google names it placement targeting - but the issue remains.
if you ask me, the cpm market is totally out of whack.
edit: argh, mods could you please change the title to "why cpm doesn't work" or so. otherwise it's a bit ambiguous, because i only describe the implications of cpm targeting, not cpc targeting, which is a different matter.
[edited by: moTi at 11:57 pm (utc) on Nov. 19, 2007]
I must say that the ads have worked okay for me. Sometimes the CPMs have been outstanding; more often, they've been adequate at best, but they've still been better than I would have expected from contextual ads on, say, a photo-gallery page where users aren't likely to be researching a purchase. (Also, when CPMs for site-targeted CPM ads are low, very few of those ads get served.)
Side note: You don't have to accept AdSense display ads to run AdSense site-targeted CPM ads. (All of my site-targeted CPM ads are text ads; I don't use display ads from Google.)
for me, it's always been a non-starter. inventory is still way too low (around 5 different advertisers in an otherwise highly competitive topic with plenty of different cpc ads). cpm is laughable. the reason could very well be that i thematically compete with the mentioned social networks.
banners are served from time to time, but i really don't agree to offer my ad space for high impact graphical banners at this rate.
and isn't it too bad to always only take cpm as a filler?
i think i have outlined a few things which could be causative and i'd like to hear statements on that. is it logical?
side note: i know that i don't have to accept image banners to run cpm ads. but at least in my area cpm ads most of the time show as image ads if ever. so in most cases: cpc = text, cpm = image. must be completely different market conditions for you and me here..
and isn't it too bad to always only take cpm as a filler?
I see nothing wrong with taking CPM text ads as fillers in AdSense ad units. They don't compete with display banners that are sold direct, by a rep firm, or a display-ad network. They compete only with other AdSense text ads.
But I would like to introduce another issue that led to my turning off CPM on my site: Google is not saying the truth when they claim that CPM ads compete and get displayed only when they could earn more than CPC ads on a page.
Fix that and let them really compete, then youtube, myspace or even MFA will be the least of our troubles.
Google is not saying the truth...
Uh-oh. Another conspiracy theory!
...when they claim that CPM ads compete and get displayed only when they could earn more than CPC ads on a page
With regards to CPM ads, I see in my stats that the overall effect works indeed as advertised. The eCPM from CPM ads is better than the eCPM from PPC ads. However, I have not broken this analysis down to single pages/adblocks. This is the overall effect.
It could very well be that Google is assigning well performing PPC slots to cheaper CPM ads, thus dragging the total eCPM down (instead of improving the eCPM on low-performing pages).
Well, we'll never know.
Clearly they want to get into that market, they have some stuff coming up that sounds a bit like insertion orders.
But at the moment I would not touch the system with a barge pole. Not enough control or transparency. When you look at other banner networks they either have very detailed control panels where campaigns can be managed or they work one-on-one. Adsense does have that approve campaign thing but it does nto tell you how much they are paying...so next to useless.
Low ball filler banner ads are ten a penny with loads of low tier networks around.
[edited by: FattyB at 2:13 pm (utc) on Nov. 20, 2007]
in order for us to use them they need to compete with the CPM we get on our banner slots not what we get from our Adsense spot.
very good point. you can't compare apples and oranges.
from the adwords blog:
If the purpose of your placement-targeted campaign is to increase sales, leads, sign-ups, or other conversion-oriented metrics, you can select CPC bidding and pay when users click on your ads. If you want to maximize impressions and increase brand awareness among your target audience, you can select cost-per-impression (CPM) bidding.
well, on paper, sounds nice. but what do ordinary advertisers really do? most of them don't care too much about branding issues - at best as a bonus, a freebie. what they do care about is accountable direct returns. on the other hand it is very difficult to measure (positive) branding effects. so if branding is one purpose, then at least it has to be dirt cheap, that's the thinking.
what's the outcome? well, google puts the banner on a click monster and the advertiser wonders about the lack of clickthroughs and user response. whereas the normal publisher wonders where his money is as compensation for the visual impact of the banners on his website.
cpm banners on adsense won't work properly, because:
a) advertisers are downright hindered to realize the benefit of a cpm campaingn on a high performance website. google makes no difference between the type of websites the ads are shown on. but it should: ad impressions on a website with a favorable visitors to impressions ratio (e.g. 1:3) are worth much more, whereas impressions on clickmonsters (e.g. 1:100) are worth much less.
b) the branding premium is not included in the payment. maybe this way it can't be factored in anyway. funny thing is, if it was included, advertisers would moan more than ever about lack of direct return of cpm ads. but they need to realize that the purpose is completely different. so you can't let cpc and cpm compete against each other at all. that's the whole point.
[edited by: moTi at 3:52 am (utc) on Nov. 21, 2007]
well, on paper, sounds nice. but what do ordinary advertisers really do? most of them don't care too much about branding issues - at best as a bonus, a freebie. what they do care about is accountable direct returns. on the other hand it is very difficult to measure (positive) branding effects. so if branding is one purpose, then at least it has to be dirt cheap, that's the thinking.
Depends on the advertiser. I've seen site-targeted AdSense CPM text ads on several occasions for companies that were big enough (and experienced enough) to know what they were doing. And these weren't the same advertisers who were buying contextual CPC ads.
Every site is different, so it's pointless to make assumptions about whether site-targeted CPM ads are good or bad. The only thing that matters is whether they're good or bad for your site, and that's something you can learn only through experience.
I see nothing wrong with taking CPM text ads as fillers in AdSense ad units. They don't compete with display banners that are sold direct, by a rep firm, or a display-ad network. They compete only with other AdSense text ads.
that's right. so to get this straight:
letting cpc and cpm text ads compete:
- no problem if the ads look the same, because same ad type, only different accounting method.
- distortion, if cpm text ads serve partially a branding purpose (like when the ad has big font and takes up a complete slot)
letting text ads and image ads compete:
- no way, because different application, different purpose, no matter if cpc or cpm
from this it follows that to make the image banner product more attractive, there needs to be a standalone solution. google, do you listen?
apart from that, if you think about it: in an auction based system, isn't the payment method really irrelevant for the purpose of the ad? advertisers simply choose the cheapest way (be it cpc, be it cpm) to achive their objectives (be it clicks, be it branding).
