It’s sad reality of the business of the internet that in order for us to enjoy the plethora of content available ‘for free’ online, we’re going to have to deal with ads. Google had previously lead the way in online advertising offering many different PPC options for marketers including Adwords, Google Shopping and their AdSense Display Network. Using a combination of all three methods is usually recommended for most e-commerce campaigns however that is all about to change.

With Social Networks having more users than most countries have citizens, their closed ecosystems offer advertisers even more options.  You can sponsor Facebook ads, LinkedIn posts and even Tweets. So Google now has many more competitors for your advertising dollars and what do they do? Instead of offering new methods of advertising, Google have decided to remove a whole section of ads displayed in Search Engine Results Pages (SERPs).

There are a few elements included in the changes to desktop results:

  1. No text ads will be served on the right rail of the search results on desktop.
  2. Google will serve four text ads instead of three in the mainline area above the organic listings for more “highly commercial queries”.
  3. Three text ads will show at the bottom of the SERPs.
  4. The total number of text ads that can appear on a SERP will shrink from as many as 11 to a maximum of seven.

So in short, demand for ads is ever increasing and Google has just reduced supply. This, in basic economic theory, should push the cost per click significantly higher. It appears as though Google has tried to soften this blow slightly by adding one more position for a paid ad at the top of the page (increasing the number to four) meaning increased visibility for the fourth ad, however removing the ads from the right sidebar and adding three ads to the end of organic search results represent a significant loss of visibility for those advertisers outside of the top three.

What does this actually mean? It’s bad news for the middle sized advertisers as the removal of ads from the right sidebar and addition of ads at the bottom of organic results means severely reduced visibility for those who aren’t willing to pay overs for the top four spots. This also means that your SEO efforts will have to pick up the slack if you’re not in a position to enter into a bidding war with your competition. A quick, “highly-commercial” search renders only one organic result above the fold, four ads at the top of results and a knowledge pane for Google Shopping ads.

serps

So moving forward, what can we do?  At Digital Affair we value data and encourage the use of multi-channel marketing that works together to achieve a business goal. Step one is to conduct a thorough review of your Adwords Campaigns, taking into account your Average Position over all of your ads. If the average is higher than three, you may need to either adjust your Bid Strategy or allocate some time to researching your target keywords to really ascertain their value. If a targeted keyword isn’t generating at least a 300% ROI then we suggest adding that keyword to your Organic SEO efforts.

Another aspect to investigate is whether or not your CPC fluctuates based on the time of day. Many of our clients were running ads 24/7 with little or no conversions occurring overnight. Stopping these ads freed up almost $400 of extra budget per week that we were then able to allocate to our highest performing keywords at the most critical times of day to ensure that one of the top four spots was ours.

Understanding Google’s motives here goes a long way to ensuring that your PPC campaign adjusts to these changes before your competitors. Google is all about their users. Having an entire page of ads lead to a poor user experience and an oversupply of ad space was leading to a drop in the quality of ads. Ever since quality score has affected your CPC (vs your actual bid), higher quality, more relevant ads have been given priority. In this case, what Google is attempting to achieve is a cleaner Results Page with less ads that are more relevant to the search query.

So to conclude, Adwords will be getting more expensive but should (if done properly) convert at a higher rate and generate higher quality traffic to your site. SEO will play a more significant role in your Marketing Strategy as PPC becomes prohibitively expensive and advertisers start to trim their PPC exposure. I, for one, welcome these changes as it’s very rare that I actually click on ads anyway, however as a marketer and consultant, I am worried that these changes may lead to significant overspending in PPC by the big players causing the middle tier of businesses to seek alternate methods or risk losing significant market share.

 

We’ll continue to monitor changes in Adwords activity online and report back with real data and some tips and tricks over the coming weeks to ensure your Campaigns are performing at maximum capacity.