Forum Moderators: martinibuster
Isn't competition for ad space a factor in determining the value of a click? For example, suppose there is an inventory of 10 advertisers for the content on one of my pages. My clicks don't convert very well. But over the course of time, new advertisers come on board until there are 30 advertisers for the content on one of my pages.
Would the increased competition for space on my site dictate that I would earn more per click despite having a poor conversion rate?
And if Yes, wouldn't that tend to be an argument for keeping my filter as lean as possible, instead of as full as possible, and thus letting the competition among advertisers work in my favor?
Based on what I am experiencing in my account since December and those nagging monthly messages from AdSense encouraging me to consider removing URL's from my filter, I'm wondering whether I should just follow Google's advice?
On a related note, does anyone have any idea what percentage of the advertisers allow Google to know how many conversions result from the ads?
FarmBoy
Would the increased competition for space on my site dictate that I would earn more per click despite having a poor conversion rate?
But would there be increased competition for space on your site? If you had a poor conversion rate, mightn't some advertisers add your domain to their site-exclusion filters? Also, don't forget that, over the course of time, there are more publishers and pages competing for the ads from those 10 or 30 advertisers. If the number of publishers and/or pages is growing faster than advertisers' budgets for the keyphrases that generate your revenue, the law of supply and demand will work against you, not for you.
Isn't competition for ad space a factor in determining the value of a click? For example, suppose there is an inventory of 10 advertisers for the content on one of my pages. My clicks don't convert very well. But over the course of time, new advertisers come on board until there are 30 advertisers for the content on one of my pages.Your question is a bit oversimplified, and there's actually not a simple answer.Would the increased competition for space on my site dictate that I would earn more per click despite having a poor conversion rate?
First, your actual conversion rate is unknown to advertisers, at least generally. Second, advertisers are not actually in direct competition with each other for your specific site, so bidding wars for your site don't work the way you might like.
Third, while companies are not in direct competitions to be on your site, they ARE in direct competition to appear on google SERPS which is why google benefits from direct competition on their own property, buy you do not from competition for your site (except for site targeted ads which are still in the disaster stage).
And if Yes, wouldn't that tend to be an argument for keeping my filter as lean as possible, instead of as full as possible, and thus letting the competition among advertisers work in my favor?
That's reasonable logic IF they compete,, which they do not.
Based on what I am experiencing in my account since December and those nagging monthly messages from AdSense encouraging me to consider removing URL's from my filter, I'm wondering whether I should just follow Google's advice?
Depends. I use the filter so my visitors don't have to see all the junk sites. I'm not removing those sites.
On a related note, does anyone have any idea what percentage of the advertisers allow Google to know how many conversions result from the ads?
Not enought to provide reliable, valid data for google to use in smartpricing. It's a bit of a myth that ACTUAL conversions are important or determine smartpricing. It's PROJECTIONS google makes about the probability of conversion in the present and future.
That's reasonable logic IF they compete,, which they do not.
I believe they do compete in the sense that if the ad inventory is greater than the available ad space, the advertisers willing to pay the most per click are going to get the ad space.
Depends. I use the filter so my visitors don't have to see all the junk sites. I'm not removing those sites.
I had that same philosophy. I sure like the results since I had a change of attitude.
FarmBoy
[edited by: farmboy at 12:27 am (utc) on Feb. 16, 2008]
But would there be increased competition for space on your site? If you had a poor conversion rate, mightn't some advertisers add your domain to their site-exclusion filters?
The part about a poor conversion rate was hypothetical.
The part about increased "competition" seems to be a reality. Since I stopped adding URL's to my filter, I'm observing lots of new ads showing up on my pages that for months just had the same old ads again and again. And my EPC has reached a level that shocks me some days when I check my account. It's like the late summer of 2003 all over again.
I haven't gone so far as to start taking sites out of my filter, but it sure has me wondering.
FarmBoy
coachm:
Not enought to provide reliable, valid data for google to use in smartpricing. It's a bit of a myth that ACTUAL conversions are important or determine smartpricing.
I believe they do compete in the sense that if the ad inventory is greater than the available ad space, the advertisers willing to pay the most per click are going to get the ad space.
The principle doesn't apply to YOUR specific site. Advertisers aren't bidding on YOUR site, and are therefore NOT competing for space on YOUR site.
It's a little hard to grasp, but once you understand exactly what advertisers ARE bidding for, then it all makes sense.
...but unless they are site targeting, they sure as heck aren't competing for YOUR site.
farmboy: You're right that, in principle, an empty filter should result in a higher eCPM. That's the way any auction- or competition-based system would logically work.
I think this kind of statement just confuses people. It's NOT an auction and has not been one for years. When on "bidder's" bid of 50 cents can be worth many times more than another person's bid of 50 cents, in terms of exposure, it isn't an auction anymore, in any meaningful way.
Google seems to feel otherwise. Suffice it to say that conversions are one factor that Google looks at; whether they are an "important" factor is unknowable, and to a large degree a matter of semantics anyway.
I think you'll find that google uses phrases like "liklihood of converting", which reflects exactly what I'm saying. You have to read very carefully when google "speaks", a lot of the information is subtle and involves very subtle wording.
As for it being semantics, you're WAY off the mark there. It's HUGELY significant in terms of publisher actions whether google relies on actual conversion data, or predicted conversion data based on on site characteristics or other non-conversion counting data.
A wily publisher simply does things differently depending on what he believes influences smartpricing re: conversions.
Nonetheless, as I already said and I agree with you about, ad placement is also based on a variety of other factors which are not transparent and which don't always yield the best-paying ad for the publisher.
I won't bother replying to all that, but the "bidding" is based on expected CPM rather than simply on the number of cents per click. Google has always been clear on that point.
Expected CPM? I must have taken a wrong turn, or perhaps my computer is caught in a time eddy, or other disturbance in the continiuum, because darned if, when I log into adwords to alter my bids, it's all in CPC.
Maybe you're thinking about the idea of revenue maximizing, and mistakenly calling it "expected cpm"?
I think you're confusing the issues really badly.
It's based NOT simply on the gross cents per click, but also on what Google expect the ad's CTR to be. CTR * CPC = "how much you earn", geddit?
To put it even more simply, a fifty-cent-per-click ad is useless if the CTR is likely to be 0%. That's why AdSense is still a competitive placement system, even though Google don't necessarily go with the highest bid.
I won't bother replying to all that, but the "bidding" is based on expected CPM rather than simply on the number of cents per click. Google has always been clear on that point.
We're saying the same thing. And it's not semantics.We agree it's not an auction based on bidding, which I said before. Where we differ, apart from your talking about cpm above which is confusing if not outright wrong, is you call it a competitive placement system, even though the people bidding have no direct control over the competition. Sigh.
And, that while the entire system may involve competition for space, that doesn't mean that anyone is directly competing for the space on any one site.
Ok. It's too complicated a distinction for most people here perhaps. But it sure as hell is an important one to help publisher understand and make decisions.
Oh well. I'm out on this.
And my EPC has reached a level that shocks me some days when I check my account. It's like the late summer of 2003 all over again.
You know, during the past few months there have been quite a few changes in AdSense that may be more of a contributing factor than your filter.
I've never really been into filtering. At most there might be a couple dozen at any given time. I typically only filter out extremely off-topic ads, and ads that include a phone number. However I've also experienced an increase in EPC during the past few months. Yesterday was the highest I can remember.
