Google has made a major change in AdWords. Historically, ads where shown on the main column, as well as in the right column. In genear, this meant eight ads per SERP. Naturally, for some queries, Google didn't show ads at all, and additionally they've been constantly testing the limit, for example through extensive product listing ads.
As shown above: 4 ads above the organic results, and the bar on the right has completely disappeared.
How will this change impact us, the advertisers?
The change means the number of ads shown per SERP (search-engine results page) is effectively reduced. Since the number of advertisers is not reduced, the competition can be expected to increase (and therefore bids).
In other words, logical conclusion is that when ad placements are cut, either CPC increases (higher competition) or impression share decreases (rotation). In the former, you pay more for the same number of visitors, in the latter you pay the same click price but get less visitors.
For Google, ad rotation does not impact their return-on-ad-spend – whilst it affects the absolute volume of sales.
For longtail and lower position targeting (low cost clicks), the impact for us is significant – these positions are not available as they used to be. At worst, this can mean that some campaigns become obsolete when the target is low CPC, not high position.
Right column ads naturally have lower CTRs – therefore less of an interest (and less of a share) of Google’s ad revenue. Another aspect is Google’s use of CTR metric to assess user experience (CTR, bounce rate, quality score).
In short, by removing less converting ad spots (right pane), this pushes ad quality up, whilst also forcing competitors to stronger competition against eachother. Naturally this is a beneficial situation from Google’s point of view.
For advertisers, due to higher click prices, impact can be seen on ROI (same level of clicks and conversion, with higher spend).
Account strategy and structure requires revision. Some campaigns might become obsolete (unprofitable), whereas on others a change of bidding strategy can help to answer to these changes.
Strategies for targeting lower positions with low CPC become more difficult – where the importance of high positions has now been emphasized. This change is not the death of longtail, but it does affect strategy and bidding.
For agencies and internal PPC teams, it is important to remember that for Google this is a profitable improvement, however for advertisers it will lead to more challenging times. On that note, this change should push for more quality ads gaining more visibility, which in general terms can be said to be of interest of Google, of advertisers, as well as customers.
(Search Engine Optimization).
Given the addition of the fourth announcement on Google's organic results, in many cases Google searches show first 4 advertisements, followed by just 2 immediately visible organic results.
This means that while before the priority was to appear in the 3 or 4 first organic results, it is now necessary to appear in the first 2 to 3 organic results, in order to receive a significant level of traffic.
While, for advertisers, the restructuring of search results can mean new opportunities and in some cases, a positive impact, in the case of SEO is difficult to identify any positive result.
In some cases, virtually no organic results are visible immediately, without having to scroll down the page of results! (Especially in the case of search terms that trigger ads Shopping):
Where are my organic results ?!
Once again, Google offers professional SEM exciting times, good and bad! If you have anything to add (or ask), just comment below!