Forum Moderators: martinibuster
I 100% guarantee that there are no earnings caps on AdSense accounts. I will swear it on a big stack of Google search results. No earnings caps.
The earnings ceiling is a bit of speculation that has divided publishers for awhile. It's about a phenomenom where it seemed an earnings cap blocked publishers from earning more, regardless of increases in traffic, clicks, or EPC. The results always seemed to balance themselves out. It appears the phenomenom, which I believe some members truly have experienced, has another explanation.
So what do you think accounts for the balancing out?
congratulations!
With us total opposite: More content, organic inbound links, info, vids, images, all original and owned, but no revenue increase at all.
Also, any conclusion based on so small a sample is totally invalid and that if you are constantly improving your site as most here are, the variables multiply rapidly.
Also known is that some here speak with a bias and that the system is so complex that even with ASA's superior knowledge some aspects remain will unclear. Assuming ASA is being totally truthful will still only know that there is no intentional cap.
Limited advertiser inventory and budgets
+ Almost unlimited publisher inventory
What's limited is the publisher inventory. Google's share of search is already pretty high and doesn't offer that much scope for growth. Their main opportunity for growing lies in getting their ads into more pages and there's a finite number of pages.
Advertisers' budgets are pretty unlimited. If they're making $1.10 for every $1 they spend they will be happy to take up every single click Google can give them. There is virtually no limit to how much they'll spend.
...it is tempting to assume that somehow G is personally targeting you.
But Google's stated goal is to personalize everything, that everyone is specifically targeted according to the profile they present. That is Google's business, it is what they do.
There's no need for any earnings cap. You just start taking a bigger share when you want to. The percentage is secret.
My average EPC this fall has increased considerably over the same period last year (it's up 40 per cent or so), so Google must have decided to give me a larger share of the click revenue. That's awfully nice of them.
On the other hand, CTR is down, so maybe Google decided to keep more of the clicks? :-)
Advertisers' budgets are pretty unlimited
You're taking only one type of advertisers and generalizing, and even that type do not adjust budget on daily basis, and even if they do put in money on daily basis, Google still has a fixed ad spend budget for that day, hence the limited resource (ad/spend inventory).
What's limited is the publisher inventory
Again it's the other way around, the daily growth in the number of publishers as well as number of new pages by existing AdSense publishers has to out pace the amount of new advertisers joining the program by several orders of magnitude, there is no official statistic to give you but it is just logical.
I wish there was an unlimited ad inventory.
An ad should bring in at least enough business to run another ad plus profit. If the advertiser has an unlimited capacity to deliver product or service then he or she has an unlimited ad budget.
No business runs with zero friction but a theoretical perfect ad brings in infinite profit.
We unfortunately inhabit the real world.
I wish there was an unlimited ad inventory.
My average EPC this fall has increased considerably over the same period last year (it's up 40 per cent or so), so Google must have decided to give me a larger share of the click revenue.
[edited by: true_INFP at 6:58 pm (utc) on Nov. 18, 2008]
Publishers have limited space and that's why per click and per impression rates do not go down under stable economic conditions. If these rates go down, this would be due to the cuts in advertisers' budget (due to worsening economic conditions) while our spaces for AdSense staying the same.
If advertisers' budgets were pretty unlimited, then we wouldn't be talking about slowing economy or global decline.
Daily ad spend budgets are false ceilings as long as the advertiser has the power to increase his daily budget and he acts logically in increasing the budget when he's getting a positive ROI.
I know it's fashionable in the Adsense forum for publishers to feel like the underdogs but it's the publishers Google is really after - the advertisers will follow.
Those who are lured by organic search or other means in the course of researching a particular subject are more likely to view multiple pages and, perhaps, click on one or more ads.
Having said that, I have also found that a site which constantly adds new content -- particularly evergreen content -- and steadily builds its average daily traffic will over time experience higher earnings in AdSense and some other programs.
My speculation is that this is because of the higher likelihood of clicks as in the earlier example and because, over time, the AdSense Gods expect higher traffic/clicks from the site in question and "budget" for it.
If the algo "thinks" it is going to get 100,000 impressions from a site and suddenly gets 300,000, it may not have set aside sufficient inventory to fill that many impressions. But if a site gradually ramps up from 100k to 200k impressions, the algo builds the higher traffic into its set of expectations.
Hey, it's as good a theory as any.
When they are getting a (measurable) positive ROI from each marketing dollar their inclination is to increase that spend, not decrease it. The state of the general economy is irrelevant from the point of view of the advertiser making a profit...
Let's suppose I make and sell widgets. I'm advertising and making $1.10 for every $1.00 I spend on advertising. In theory, there would be no limit to the amount I'm willing to spend on advertising under those conditions.
But to keep it going, I've got to be able to find buyers for my increasing production of widgets. I have to be able to find skilled employees. I probably need to be able to find credit to enlarge my building and purchase new machinery. Competitors will enter the picture as they see my business booming.
My ability to earn $1.10 for each $1.00 spent on advertising will be dampened unless I can successfully address all of the above.
FarmBoy
However, it's not a cap created by google. It's a cap created by the advertisers (like me) who advertise on your website via Google.
Fact is, google only sends through a limited group of advertisers who are relevant to your website.
Everyone in that group have caps on their budgets (trust me on this one, without caps, we'd be very very poor).
Thus, there is an effective cap on your earnings.
My suggestion, if you hit that cap, either branch out into new topics or add other advertising systems to the mix.
Looking at stable earnings from the other side, what about when traffic and or page (ad) views drop dramatically but income remains fairly consistent, does it mean there is an income floor for the site?
Have never experienced this. Fall in traffic always meant lower revenues (and thus the weekly trend in our earnings rise and drop)
Of course there is a cap.
However, it's not a cap created by google. It's a cap created by the advertisers (like me) who advertise on your website via Google.
This perfectly explain steady daily revenue regardless of traffic numbers (low traffic days too). Have seen it happening a million times.
I also like how exactly on 1st November the "Global financial crises" has struck many AdWords advertisers and my daily income was cut in exactly half. It sure had nothing to do with that maintenance a couple of days earlier or that letter from the AdSense team about slow market conditions.
Yea must be some unexplained algo at play...no doubt. :-0
[edited by: Web_speed at 12:12 pm (utc) on Nov. 19, 2008]
10 hour server outage. 100% down. Total crash in the middle of the day. No pages served, nothing, a total mess. (See message # 3750169 in this thread [webmasterworld.com].)
Later I saw the weird Adsense figures:
1. best eCPM in 2008
2. highest EPC in 2008
3. revenue clearly above average
4. all this with just 60% of the typical traffic
Strange, don't you think?
It's a cap created by the advertisers (like me) who advertise on your website via Google.
This does not explain the phenomenon that happens when a large block of pages is moved onto the site which initally brings in more earnings but within several days has readjusted to old levels. I have experienced this several times with different kinds of pages, different topics, different keywords that necessarily had to involve different advertisers. Yet old earnings levels return...
Yes, yes, I know it's all my imagination and that there must be some other explanation that I'm too dense to see because there cannot be a cap.
Strange, don't you think?
@ Zett
As i thought...must be some unexplained sophisticated algo at play.
This daily revenue "no cap" trick is so advanced...it is really very hard to detect, and has (like many other god old G tricks) many names and statistical explanations.
Gee, we must be very dumb OR illusinating.
[edited by: Web_speed at 4:37 pm (utc) on Nov. 19, 2008]
Let's suppose I make and sell widgets. I'm advertising and making $1.10 for every $1.00 I spend on advertising.... to keep it going, I've got to be able to find buyers for my increasing production of widgets.
And if you're making consistent profit the capital for expansion is not a problem.
But, irrespective of the logic or the economics, the facts speak for themselves. There's a reason Google pays a huge chunk - estimated 2/3 of the take - to publishers.
When you're making $1.10 in profit for every $1.00 in advertising you've already got the buyers.
The context of the thread was that as long as advertisers can make $1.10 for every $1.00 spent on advertising, there would be no limit to how much they are willing to spend on advertising. There are limitations on the demand for any product or service.
And if you're making consistent profit the capital for expansion is not a problem
That's not how things work in the real world. I can show my banker that I pocket $.10 for every widget that goes out my door now and I want to borrow some money so that I can increase my production of widgets by 25%. He's not going to lend me money unless I can show him I can find new or existing customers willing to buy that 25% more widgets I plan to produce.
And in the current business climate, my access to credit is limited even if I can show a good reason to believe I can sell 25% more.
FarmBoy
Gee, we must be very dumb OR illusinating.
?
And in the current business climate...
Not even signed purchase orders from Fortune 500 companies, and it may only be a matter of time before T-Bills are downgraded from AAA.
Our entire economy may be an illusination, whatever that is.
But hey, things will turn around. I hope we live so long, hope is cheap.
As long as the premise holds the conclusion is valid. Your error is in changing the premise ;)
But I'm afraid you may not be convinced and as this is threatening to derail the topic of this thread, I will make it my last post on the subject.
