Adsense Geo Dilution: Is That Real?

do low rpm countries affect high rpm countries

[kkinfy]

Hi, our website predominantly gets traffic from the US and Europe. But unintendedly the traffic is growing significantly from a developing country. However, the RPM of that country is about 20 times lesser than the US and developed economies. Now the low rpm country brings in about 20% traffic. During the initial days, the traffic used to be on the lower end of 5%. Now my question is this: Does the reduced rpm in one country affect the rpm of another developed country? I am asking this because our RPM from the US is dropping at the same time as traffic growth from the low rpm country. Is such a kind of Geo-Dilution of RPM real?

[SweetPotato]

I don't believe this. It's just a coincidence.
US RPM fluctuates, whether you have low tier traffic or not.

[Niresh12495]

@kkinfy i have the same doubt

[kkinfy]

Hi @NickMNS please can you let me know your views if dilution may occur due to uneven geographical RPMs.

[NickMNS]

No, revenue is determined by supply and demand in each auction for each page view. The bidders bidding on an auction for page view in India are unlikely to be the same as those biding for a page view in Switzerland. The fact that your website get page views in India should have no effect on those advertisers bidding on US or European page views. As SweetPotato has pointed out:

RPM fluctuates

If you want to increase RPM you need to increase demand for your website, which is not an easy task.

[kkinfy]

@NickMNS I understand that a vast majority of advertisers are going to bid for auctions in a specific country or a handful of countries. However, for campaigns that target many countries (like lead capture or sales campaigns that target users from various parts of the world especially in geographically distributed niches) I am assuming the following hypothetical scenarios:

Scenario I:
1) Leads will be cheaper in low RPM countries.
2) Even if the advertiser bid around the same cost in different countries, lack of competition and the second-price auction would ensure that the CPC is lower in low RPM countries.
3) Algorithms like smart bidding (which most advertisers use nowadays) will gradually shift the impressions to low RPM countries in search of more leads at the least cost.

Scenario II:
1) In low rpm countries, not providing a website in the local language may turn off visitors, increase bounce rate, etc. The impact of user experience will affect the domain's quality in the eyes of Google and Adsense.
2) For the same language reason, there may be invalid click activity in low RPM countries. This again reflects on the domain's overall quality and brings down the overall RPM.

I know I am imagining too many things here. But can any of the above scenarios be even partially true in the real world?

[NickMNS]

Let me start with:

second-price auction

The auction type doesn't change anything, it will make no difference at all as to how much you get paid for your ads. The difference is on the advertiser's end and is only related to what price they bid in the auction and should not have effect on the final prices of the auction. The only impact, if any will be felt for a short period after the auction type is changed while bidders adjust their systems and metrics for setting bids.

In most cases most advertisers are not bidding specifically for their ads to appear on your website. The website is just one of many factors that advertisers can you for selection, and most don't care about the website, they care only about the user. If an advertiser is targeting "low RPM" locations, then there is not much you can do about that.

You can block those locations, but to what end. It is like someone offering to give you 1$ but you say no I only accept a gift of 10$.

The bottom line is that the more bidders are willing to bid on your impressions to better it is for you. Impressions are awarded to highest bidder, there is no scenario that exists where having fewer bidders produces a higher price.

Moreover any additional page view generates more revenue whether the page view is in "low rpm" location or not. Unless, there exists some reason that you have reached a maximum of pages that can be served and serving a page in "low rpm" location is preventing you from serving a one in a "high rpm" location. That then becomes a technical / server issue not having anything to do with Adsense.

If you want to make more money with Adsense there are only two things you can do.

1- Increase demand, by convincing advertisers that they should target your website specifically.
2- Increase supply, by convincing Google (other search engines too) that they should show more users your website in the search results, or convince your users to spend more time viewing more pages on your website.

Simple! Unfortunately both those points are difficult to achieve.

[NickMNS]

One more point. Fortunately achieving success with point 2 of my closing above will generally lead to success with point 1. High ranking, with many page views and return visitors will typically grab the attention of advertisers and make them seek out your website specifically.