We were used to see right hand side ads on the Google search engine since 2000 but from February 19th, Google has decided to take them away progressively and by the 22nd (8th week) we are no longer seeing them.
From now on if you perform a search on a desktop device you will not see the right hand ads you were used to. Although, Google shopping ads will still be placed there as well as other kind of information such as Google My business and maps information.
Why did Google decided to do so? Well, from this point is all speculation. Some might say that it is because Product Listing Ads (PLA) will gain more and more importance, other think is because the CTR for the vertical ads slots was much lower than for the top position. Perhaps Google wants to “clean” the Search Engine Result Page (SERP) and do not “overprint” their SERP from so many ads.
So, what happens with the ads that were displayed in the right side?
Well, do not panic (yet). Google has decided to increase the amount of ads from 3 to 4 on the top position, but only for highly commercial queries. This means, that Google perceives those keywords as with high intention of purchase.
But.. what happens if in a SERP there are Product Listing Ads (PLA) results as well? We have made the test several times and this does not look good for us. See it for yourself:
As you can see in the image above, this is one of the worst-case scenarios. Because of PLA, there are only 2 search ads displayed in the first page! And hey, the search query is “prada sunglasses”. I must confess that I have seen other SERP with PLA and up to 3 ads in the front page and 3 in the end of the page but still. The outcome is the same, less ads are displayed in the top positions.
So now that you know this change can affect the way we were doing PPC. We are going to analyze one by one the most concerning ratios.
Let’s now analyze and discuss how can this affect our PPC strategy in Google Adwords.
Change in your average Cost per click (CPC) and impressions
It all indicates that since fewer positions will be displayed in the first page, the CPC will go to skyrocket. Although there are others saying that since now there are more positions for the top positions, the prices to be there will decrease. It all depends on your market and how much are you willing to pay to be in the first page but one thing is certain and that is, there are going to be much less slots for the first page.
As for the impressions, It is obvious that if we have less slots available, we will have less chances to appear on the first page. That means less impressions.
Change in the ad position
According to Google, if we have an ad position between 1 and 4, we are going to be showing our ads in the first page. This is the answer they have given me when calling to the Adwords support site. But, what happens if there are only two slots available in the SERP? Then if we happened to be in the third position, we will automatically get an average position of >6 . This is very concerning since it will affect our amount of impressions and CTR and therefore the quality score. This will be critical if we are in a market where the competition is fierce. Yes and I know this was happening before as well but now with this change, the consequence is even more aggressive.
For those of you that are doing bid-to-position strategies, beware that the positions have changed and it is currently somehow confusing. We personally, do not recommend working with this kind of strategy since based on our experience there are other factors more important that the average position.
Organic Search Results are the hardest hit
As you know, if you have a well-positioned webpage, your chances to obtain better results in your PPC campaigns will increase. That is clear since it was common to see in a SERP a PPC ad from advertiser A and right after their SEO link. With the Adinton Tool, we could measure how much SEO was influencing PPC conversions and the other way around and the results were quite interesting.
Google, has make it more difficult for us now. Since Google has added a #4 PPC position, that means that the #1 SEO position is gone. On many devices, SEO results won’t even be shown above the fold, specially if there is PLA as well.
The overall result will be, if there are less impressions of your ads PPC or SEO your total amount of conversions will decrease.
The only conclusion I can take right now is that Google has built a system which aims to “benefit” us all but in the end we all get nothing but less impressions and therefore, less chances to show our ads to our potential customers.
What have we seen with this new change
The total change was made on the 22 of February, therefore on the week number 8. The tables you are about to see are from Search campaigns (if not stated) from many of our clients which market is highly competitive.
Change in the average Cost per click (CPC)
As for what we have been able to analyze, CPC has not varied, which is not good news. Think about it, less slots, same CPC, this means the average CPC for the first page has increased. So, in the end you are going to be paying more for being able to be in the first page, achieve less impressions and consequently less chances to achieve a conversion.
Change in the amount of impressions and other ratios
So if we compare previous weeks with week 8 and 9, the first thing we can see is that the amount of impressions have decreased compared to the previous weeks. It is a very concerning change since it is a 15% less of impressions than previous weeks.
Consequently, clicks have decrease as well but not accordingly since the CTR has increased week after week. This means our clicks are been more relevant compared with our impressions. That means if there are less ads, we have more chances to be clicked, right?
Now it’s time to check our conversion rate… Ok yeah it looks like it has not moved much but has slowly decrease but it all seems ok right? Now let me tell you the bad news… Even though everything looks in our favor, the total amount of conversion have decreased alarmingly.
Moreover, CPL has stayed the same or increased slowly. What does that mean? This means that when our ads appear on the SERP, we have higher chances than before to be clicked (since there are less ads displayed), but that also means that we will get more irrelevant clicks. Moreover, since we have less chances to appear, our chances to sell are going to decrease and therefore, in the end we are going to be selling less.
The big surprise, PLA
As we said at the beginning of the article, we could think PLA would have a positive outcome. Now it’s time to check the reality.
As the major change was made on the 8th week, we can observe a major increase on impressions and clicks. This might seem like a positive outcome you might say right? Let’s now check the total amount of conversions and the conversion rate.
As you can see in the graph, the conversion rate suffered a major fall by the day of the change but since then has slowly been increasing. As for the total amount of conversions, the graph would look very similar to this one. What does that tell us? Everything was fine before the major change of Google, we could even think we had competitive advantage by displaying PLA but now that there are less ads and those are gaining relevancy, our PLA are suffering from it as well. It is too early to say anything else but it seems PLA effectiveness is not going to be the same as before.
Although the numbers might look positive, do not forget that the total amount of conversion have decreased and the cost per conversion has increased. Adwords has got more expensive and if we do not adapt ourself to this change we will keep losing impressions. As for what we have seen, Search Campaigns are going to become more expensive and PLA will play a major role to gain more impressions. On the other hand, since PLA will get a “higher role” on our strategies we might start seeing more competitors doing Google Shopping ads.
What can we do about it within the SERP?
Increase your overall QS
Work on strategies to increase your overall Quality Score. More accurate Keywords, more relevant ads, more user-friendly landing pages. The overall user experience is what will make you increase your QS. The way we see it, Google wants to increase the relevance of the SERP, and the only way of achieving it is through the quality score. The higher the QS, the higher the chances to be on top positions. Do not leave the improvement of your QS for as the last task since this is going to be playing a major role from now one.
Optimize your site for mobile
Accordingly with what we have said before, now it’s more important than ever to have your landing page optimized for mobile devices . Since the amount of impressions will decrease on desktop, we are obliged to increase our mobile traffic. Remember that cross device conversions is a reality and even if a user does not convert through a mobile phone, it may be they have checked you out on it.
Product listing ads
If you are doing SEM for advertising your product and do not have a Shopping campaign, you are doing it wrong. PLA appear on the very top of the SERP. Moreover, an image is known to be more powerful than a text ad. Another advantage is that to appear in PLA does not imply not to appear as well as a search ad. Plenty of possibilities with PLA are awaiting for you!
Other things we can do out of the SERP
Social Media ads
Reinforce your PPC ads with Social Media ads in order to gain visibility among your potential users. Facebook, Instagram, Twitter… Depending on the kind of product you are selling or the kind of strategy you are using, there are other traffic sources that will adapt better to your needs.
Moreover, did you know that you can run Facebook Shopping campaigns? You just need a product feed and a facebook page!
Use other search engines
Do not settle with appearing only in Google, there are other ways of approaching your potential customers or users. Bing ads, Yahoo ads, Affiliate sites…
Did you know that last year, Yahoo had over a 28% of the market share in the US? Or that in Russia the main search engine is called Yandex? There is plenty of opportunities out of Google, so do your research and explore other possibilities!