CTR has been dropping every year since 07 for us across hundreds of different topics. We now range at just 25% of our first few years with adsense. Judging from how are comp has placed ads they are seeing the same thing. All used to run 1 well placed text only block, they are now running 3 regular blocks with a few adlinks and search. All with image ads enabled.
People just are not clicking as much because - the great recession - duel wars with a possible 3rd in the works with Iran - housing collapse - wall street collapse - banking collapse - euro meltdown - possible double dip recession or worse depression - massive unemployement - massive underemployment - record US debt - US GDP and Debt almost tied - Fear is rampant - middle-upperclass totally freaked out(2 neighbors had bomb shelters installed recently) - wall street totally out of tune with reality (re Charles Munger, Warren Buffets longtime business partners article "Basically, It's Over" - completely unrelated "interest based ads" - I am pretty sure adsense blindness is setting in
I could go on and on;)
We also enabled image ads across many sites and saw a small increase in both ctr and earnings as in the past it didnt help but hurt. Seems it is taking quite a bit to get a user to click nowadays.
I am directly testing image ads against text ads at the moment; was really expecting low performance from image but I have been surprised. The CTR is better, and the eCPM only a little less. This didn't used to be the case.
image ads are hit and miss, the creative being displayed has a huge impact on CTR.
The goal of image advertisers is to get their banner in front of you but not get any clicks. Why? because they want branding for free. Imagine showing your banner on thousands of pages per day, almost free!
Text on the other hand is for clicks. Sure, including images will improve epc since you have a larger pool of ads to draw from but you will also lose clicks so it balances out. The only WIN situation is when your site shows one of the extremely clickable image ads a lot but those are expensive on the advertiser and campaigns don't last long for these.
Text only for me. I reserve image ads for other locations and lead them to affiliate offers (aka I choose the creative)
I really think the nitch really plays a huge role in what ad type works best. For us the 2 ad unit text ad works. Tried others fell off the planet switched back and back on track. Tried more ads per unit dropped went back to regular 2 ads per unit back up. Tried them all hands down for us is the 2 ads per unit placed within the page text above the fold. Getting the right place, number of ads per unit, type of ad, and color is all about testing. When you find the right combo best thing to do is stick with it.
Also, there is a marked difference in quality in between the glossy professional "agency" type image ads, and the ones the advertisers can do themselves with the display ad builder. Obviously I can't directly measure CTR on them. But they just don't look good.
I switched to text only and income remains the same. I'll try to set up only image ads but my understanding is that's only possible touching ad by ad (a lot of work)... and I have no great expectations about it. Seems like no matter what media type nothing results in more savings.