Forum Moderators: martinibuster
probably started around the end of april, before recovering a little tiny bit first week of may, and then heading south. shows no signs of slowing either. i'm now down to about half what i was earning at the end of april. the last two days have been truly awful.
i've seen some graphs about the slump in eCPM for various different countries (uk, spain, france), and they all show drops of nearly 50% from about December 08 to February 09. i'm guessing the economy has only got worse since then.
so instead of another depressing thread about how we are all doomed to die a penniless death, i was wondering if anyone has some good guesses about when the upturn will begin.
i figure that a lot of advertisers plan their budgets quartley and half-yearly, so the earliest that we might realistically expect an upturn is july. probably a bit optimistic though.
i was wondering if anyone has some good guesses about when the upturn will begin.
When people start spending like crazy again is when you'll see the upturn.
Credit must be available and cheaper as the CC companies are randomly raising people's rates to radical amounts or just canceling cards, sometimes for no apparent reason, which will both have impact on AdWords spending.
The indicators to watch for are when the housing sales increase, stock markets start to gain steam, retail spending is on the rise and the jobless numbers are declining.
When all that happens, people will start spending on advertising again.
Until then, brace for the long haul.
1) The economy, which may show improvement in some sectors and regions before it does elsewhere.
2) Evolutionary changes in how the AdWords/AdSense program works, which may help some publishers while hurting others. (Placement targeting, the site-exclusion filter, and how Google determines whether a click is valid come to mind.)
3) Changes in the advertising industry itself, which may help some publishers while hurting others. (There are a lot of very sophisticated things happening with media buying, how ads are served, etc. that could have an impact on Joe Publisher's AdSense earnings down the road.)
4) The ratio of supply (AdSense impressions) to demand (AdSense advertiser budgets), which depends not only on the economy, but also on relative growth rates for Web pages and ad budgets.
In other words, an economic upturn would be helpful, and some analysts are predicting that ad budgets will increase later in the year. But even if budgets do increase, other factors could keep the average publisher's earnings from increasing at the same rate.
But even if budgets do increase, other factors could keep the average publisher's earnings from increasing at the same rate.
Some publishers were going down due to smart pricing and other factors even when most of use were having boom years so some may never see an upturn.
My point was and still is when you see people spending money odds are you'll start earning more money, assuming something else hasn't happened to your account, but it will need loose budgets and credit which we currently don't have.
[edited by: incrediBILL at 10:14 pm (utc) on June 7, 2009]
Newspapers will be going out of business left and right - that is a good thing for us.
More ad control and response statistics will mean other advertising venues will decline as well (radio, magazines) and moving to online methods.
My bet is that the economic worm will turn on or about Thanksgiving of this year.
You may quote me on this.
1. Anyone who is watching the news with baited breath for "the" report that indicates things are about to turn is just setting himself up for disappointment and frustration. Among other factors, the mainstream media in the U.S. is eager to find something they can report to show the economy is getting better. I'll stop there because saying anything more will create a political discussion that won't help anyone concerned about earnings from AdSense.
2. Unless there are drastic changes to what has recently been started and has been planned, don't be surprised if the lifestyle/standard of living in the U.S. takes a hit for a decade or more. How that will impact your AdSense earnings depends a lot on your topic, where your visitors come from, etc.
FarmBoy
Sure all technology and algorithms will change over time - so what.
Tell that to the AdSense publishers who were complaining of declines in earnings before the current economic crisis.
What's more, the factors that I mentioned weren't limited to "algorithms and technology." Some were far more basic, such as more hands-on control for advertisers (placement targeting, site-exclusion filter) and comparative growth rates for AdSense impressions (a.k.a. the number of Web pages with AdSense ads) and advertisers' budgets. If you're Joe Publisher and your site doesn't perform well for advertisers, and or if you're Jane Publisher and your topic is one that's generating pages faster than advertisers are increasing their budgets, improvements in the economy may help to slow the bleeding, but they won't close the wound.
Anyway, I'm just thinking out loud here because I'm not going to do this. But it seems like "window shopping" should be as popular as ever and an advertiser that's in it for the long run will be happy to have ads on that sort of site. One of these days, I am going to buy that lens, and it will probably be from one of the advertisers that I checked out this year.
From the advertiser's point of view, if the cash flow isn't sustainable and flowing on time to pay the bills, the game is over.
But it seems like "window shopping" should be as popular as ever and an advertiser that's in it for the long run will be happy to have ads on that sort of site.
The thing is, direct-response advertising is intended to evoke a response right now, and advertisers who measure ROI from their direct-response campaigns are interested in current conversions, not in building brand awareness.
To use an analogy, AdSense cost-per-click ads are like the classified ads in your local newspaper's car section that say "2009 Rockbuster Pickup Demo, $19,999." They aren't intended to sell you on the Rockbuster Pickup (that's the manufacturer's job), or even to instill good feelings about the Shelbyville Rockbuster dealership. They're just intended to get you onto the dealer's premises in the next day or two so you'll buy that Rockbuster pickup or one of the other vehicles on the lot.
My underlying question here is... Why would people click less ads simply because they can't afford to buy, when it doesn't cost them anything to click?
Why would people click less ads simply because they can't afford to buy, when it doesn't cost them anything to click?
From a macroeconomic perspective, I am pleased to see people exercising more restraint and trying to avoid the frivolous purchases that brought everyone into the current economic mess.
From a personal perspective, I am annoyed that my sites' visitors are exercising such restraint. They should click on ads, go to the sites, and THEN exercise restraint and not buy. :)
Why would people click less ads simply because they can't afford to buy, when it doesn't cost them anything to click?
But the transaction still involves a seller (you) and a buyer (the advertiser). The click is still worth the same to the consumer (zero) but to the advertiser, it's worth a lot less if they are not going to buy.
I don't think visitors are clicking less. I think advertisers are bidding lower.
I don't know when the economy will turn around, but I'm guessing online advertising will be a leading indicator rather than a trailing one -- the recovery should be preceded by a lot of speculation that there is going to be a recovery, which may lead businesses to increase their ad spend to try to get a jump on it.
Why would people click less ads simply because they can't afford to buy, when it doesn't cost them anything to click?
A better question would be "Why would people bother to click 'buy now' ads when they have no intention of buying?"
What's the benefit to them? Surely the average user isn't foolish enough to think "I should click on this ad just because I get to press my mouse button for free?"
A better question would be "Why would people bother to click 'buy now' ads when they have no intention of buying?"What's the benefit to them? Surely the average user isn't foolish enough to think "I should click on this ad just because I get to press my mouse button for free?"
Are they clicking less, showing restraint as pointed out by LifeinAsia? Or as freejung has suggested, are advertisers simply paying less per click? Either would cause a decrease in advertising spending and that would be reflected in Google's financial reports.
As I understand from Google's most recent report, 1st quarter 2009 revenue is up 6% over 1Q 2008, but down 3% off of the last quarter of 2008. But that doesn't correspond with what people are saying here. If a publisher's AdSense revenue is tied to the economy, then it seems like they might have seen decreasing revenue since the end of last year, but it should still be higher than the same period last year.
So somehow I think there's much more going on here than the economy...
Are they clicking less, showing restraint as pointed out by LifeinAsia? Or as freejung has suggested, are advertisers simply paying less per click?
On my site, users are clicking less but advertisers are paying considerably more per click than they were a year ago. Different publishers will have different experiences, of course. But the fact remains that direct-response ads are designed to elicit an inquiry such as a click, a phone call, or circling a number on the classic bingo card. Common sense would suggest that inquiries are harder to generate in a recession than in an economic boom. (Even at the best of times, the default user behavior is not to respond to a direct-response ad.)
We have a tremendous amount of ppc data for content sites. We can trend it by geography, category, etc. We are thinking of putting out a report on it. Let us know what data you would like to see in it that can be aggregated up.
Everything! Haha, just kidding.
One thing that's important is to define exactly what sort of site(s) are covered. For example if a report says that revenue on a travel site peaked in July but fails to mention that the site focuses on Alaskan cruises then the metrics are less useful.
Turns out, they are advertising over at Yahoo. Which I had never seen before. That explains my 30% drop in revenue through Adsense.
Decided to go see how I was ranking over there for my kws and sure enough, there was an exodus of out Adsense.
I think it time to drag my old YPN account out again and put some ads on some pages and see what happens.
Are they clicking less, showing restraint as pointed out by LifeinAsia?
Our research suggests that the people actually ARE clicking less. It began in October (after the meltdown of Lehmann), and it still has not recovered. This statement is based on our independent click-tracker that for a long time now has captured the clicks on Adsense. In October, the number of clicks decreased significantly, and this move was reflected both in the official Adsense stats and the independent click-tracker stats.
As for the reasons - this is where we can start to guess. Is it a reduced willingness to buy (probably), issues with targeting (also probable), Adsense blindness in general (likely)? We don't know. Google keeps us perfectly in the dark over this.
As for the reasons - this is where we can start to guess. Is it a reduced willingness to buy (probably), issues with targeting (also probable), Adsense blindness in general (likely)? We don't know. Google keeps us perfectly in the dark over this.
"Reduced willingness to buy." That sounds likely, given the constant barrage of economic bad news since September, 2008.
"Issues with targeting." Depends on the sector and the publisher, I'd guess, but most of the ads that I see on my site are extremely well-targeted (more so than they were a couple of years ago, in fact).
"Ad blindness in general." It's certainly possible that the ubiquity of AdSense ads has led to a gradual increase in AdSense ad blindness, but why would ad blindness have taken a jump in October?
Best guesses for when the upturn will begin?
Would you like this akin to a long-term weather forecast? :-)
Bright intervals here and there for the next 10~12 months with pockets of depression in many areas but once we enter late Spring 2010 expect to see brightening skies with healthier bodies and attitudes all round.
Nearest I can to it today:-)
Bright intervals here and there for the next 10~12 months with pockets of depression in many areas but once we enter late Spring 2010 expect to see brightening skies with healthier bodies and attitudes all round.
Where I live, late spring is the beginning of the thunderstorm and tornado season. :-)
Where I live
Therefore you may be in one of the pockets of depression :-)
