When Google decided to kill right-hand PPC ads, many speculated that the change would be a net negative for paid search marketers.

A minority even suggested that there would be drastic effects, such as significantly higher CPCs for competitive keywords.

So how have campaigns been faring since Google implemented the change?

According to Larry Kim, founder and CTO of WordStream, there certainly hasn't been an "Adpocalypse."

He looked at data for more than 2,000 of his company's clients before and after Google's change and found that:

  • Impressions are down.
  • CTRs are up.
  • Total clicks are steady.
  • Overall CPCs have actually dipped.

Interestingly, Kim found that the third ad spot in the desktop layout, and not the fourth, has seen the biggest increase in CTR.

And while the decrease in impressions for ads in the eighth position and lower is significant, the impact is quite modest because these ads only made up a fraction of a percent of all desktop impressions in the first place.

Even losers win

Based on the large sample size of WordStream's cross-industry data, it's clear that on the whole, Google's changes have not produced many negative effects, and may even be beneficial in some cases.

But surely there must be losers?

It took some digging, but Kim identified a financial services advertiser that previously had an average position of 8.6 on desktop.

"After the new SERP rolled out, they got killed, losing 80% of their desktop impressions," he explained. "But here’s where it gets interesting. Their CTR more than doubled."

All told, the advertiser lost 15% of its desktop traffic and is paying $0.16 more per click, but its average position jumped to 4.3, so as Kim sees it, the advertiser now has more valuable real estate.

Kim concluded...

The fact that an advertiser with an average position of 8.6 didn’t get wiped out - especially considering Google eliminated ad positions 8–11 from its SERPs - is of major significance.

What does it mean? Well, it leads me to believe that Google is sharing the impressions a little bit, as opposed to using a “winner takes all” approach.

Unexpected benefits

Others seem to have benefited unexpectedly from Google's changes.

For example, there was concern that charities who rely on Google’s Ad Grants programme could be hit hard, but according to Christopher Whalen, a Search and Analytics Consultant at Torchbox, that hasn't been the case.

In a comment on Econsultancy, he revealed some of his own data...

I've analysed data from 25 Google Ad Grants since the changes came into effect on 18 February 2016, comparing three weeks before and after the loss of side ads. Since the change, clicks have gone up 5%, clickthrough rate has improved, cost per click is 3% lower and average ad position jumped from 2.4 to 1.9.

I agree that volume below the top ad positions has decreased but this is more than compensated for by the increased volume and exposure in the top positions.

Before the change, 57% of Google Ad Grants ad impressions were in the top positions; now this has increased to 68% - so charities are actually getting more, not less, exposure.

Obviously, results vary and it's likely that some advertisers will be forced to adjust their strategies as a result of Google's changes, but so far, it looks like advertisers worried about skyrocketing CPCs and drastically reduced clicks across the board can breathe a sigh of relief.

Patricio Robles

Published 1 April, 2016 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (1)

Raj Kishore

Raj Kishore, Digital Marketing Analyst at Vocso Technologies Pvt. Ltd.

Thanks for aware us about that update. I think it's a very bad update for paid advertisers.

Cheers,
Raj Kishore
http://www.vocso.com

over 1 year ago

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