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The declining profitability of Google Adwords

successfulsoftware.net

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Re: The declining profitability of Google Adwords

#91

Post by pilsetnieks »

6cxs2hd6 wrote: post #40
NKCSS wrote: post #37

Earlier quoted context omitted.

I agree; the site for the software looks terribly out of date, which in turn doesn't instill confidence in potential customers. Updating the site would be his best investment.

Although I agree updating the site would be good, that's not really to the point of the post, which is about click-throughs _to_ the site.

Lower conversion rate ale signifies lower page quality which is another factor that AdWords use to calculate the ad position, and if and to whom to show the ad to. Which, in turn impacts click rates and so on, ad nauseam.

Re: The declining profitability of Google Adwords

#92

Post by enjo »

avimeir wrote: post #73

In my previous gig we used to spend single-digit millions/year, and saw all metrics falling down like OP did, and we had a team of 6 experts with tons of experience in AdWords. Not sure about this vertical, but in other (much more lucrative) ones such as travel, Google is pushing its own solutions at the expense of other websites. For example, try looking for a hotel in new york and you will see Google Hotel Finder r…

Seeing similar in home-services. Plumbing, electrical, etc.. have steadily risen over the last few years. We have highly optimized ads pointing to highly optimized sites (better than 30% conversion to phone calls). In the end we're rapidly being priced out.

We saw it coming, thankfully, and have been moving to a broader advertising strategy which is working well.

Re: The declining profitability of Google Adwords

#93

Post by avimeir »

enjo wrote: post #92
avimeir wrote: post #73

In my previous gig we used to spend single-digit millions/year, and saw all metrics falling down like OP did, and we had a team of 6 experts with tons of experience in AdWords. Not sure about this vertical, but in other (much more lucrative) ones such as travel, Google is pushing its own solutions at the expense of other websites. For example, try looking for a hotel in new york and you will see Google Hotel Finder r…

Seeing similar in home-services. Plumbing, electrical, etc.. have steadily risen over the last few years. We have highly optimized ads pointing to highly optimized sites (better than 30% conversion to phone calls). In the end we're rapidly being priced out. We saw it coming, thankfully, and have been moving to a broader advertising strategy which is working well.

Do you mind sharing what's working for you these days? which channels? Do you do offline also? Would make sense given your vertical..

Re: The declining profitability of Google Adwords

#96

Post by joering2 »

wwwong wrote: post #78
joering2 wrote: post #63

Earlier quoted context omitted.

Updating site wouldn't make a dent. You seen Cragilist recently? or even Google homepage for the last 10 years?? People go to his website for a certain product. They couldn't care less how the site looks. Does crappy look of Apache software website turns you down from getting the newest download? How about PHP site not updated since 1999. Does their crappy site means they don't know their craft? After checking couple…

Why wouldn't updating the website make a dent again? Landing page optimization is a huge forcus for any online commerce company because updating a website (design, content, flow) does make a dent.

okay I am talking about the outlook, not landing page optimization and the stuff under the hood.

sorry but his website talks to me: "hey I seel software to plan tables and i know how it works, but i am not a designer and wont spend money for a coll website". which is fine with me. again, I didnt came there to appreciate his website apperance but to see if his software is good enough for me (had I been in the business that needs his software)

Re: The declining profitability of Google Adwords

#97

Post by joemoon »

joering2 wrote: post #96
wwwong wrote: post #78

Earlier quoted context omitted.

Why wouldn't updating the website make a dent again? Landing page optimization is a huge forcus for any online commerce company because updating a website (design, content, flow) does make a dent.

okay I am talking about the outlook, not landing page optimization and the stuff under the hood. sorry but his website talks to me: "hey I seel software to plan tables and i know how it works, but i am not a designer and wont spend money for a coll website". which is fine with me. again, I didnt came there to appreciate his website apperance but to see if his software is good enough for me (had I been in the business…

You're taking your own opinions and applying them to the entire target market. Just because you feel this way doesn't mean that everyone else does, and it certainly doesn't imply that "updating the site wouldn't make a dent".

Re: The declining profitability of Google Adwords

#98

Post by davidsturnbull »

Imagenuity wrote: post #90

You can't just display an ad at any price, even if there are no other ads. There are too many spam ads now, but it used to be quite a bit worse. Setting a minimum price sets the bar high enough to make it not worth the cost to spam. It's gotta be a juggling act for Google to keep prices within reach of legitimate advertisers while keeping out the riffraff. The only other solution is to manually approve all ads before…

Hang on a minute. What's the difference between spam and an ad, anyway? It's all spam, surely.

Re: The declining profitability of Google Adwords

#99

Post by joemoon »

pilsetnieks wrote: post #91
6cxs2hd6 wrote: post #40

Earlier quoted context omitted.

Although I agree updating the site would be good, that's not really to the point of the post, which is about click-throughs _to_ the site.

Lower conversion rate ale signifies lower page quality which is another factor that AdWords use to calculate the ad position, and if and to whom to show the ad to. Which, in turn impacts click rates and so on, ad nauseam.

This is incorrect. The conversion rate does not affect your quality score: http://adwordsagency.blogspot.com/2008/12/quality-score-fact...

A "conversion" means different things to different companies. It would be extremely easy to game the system if conversion rate affected quality score.

Re: The declining profitability of Google Adwords

#100

Post by monkeyspaw »

programminggeek wrote: post #51

There is a very simple reason for this happening - Google needs to keep making more money, so over time they need to raise advertising prices or increase click volume. There isn't going to be a dramatic increase in click volume anytime soon, so for Google to grow at 20%+ a year, they need to raise prices over time, which they do via quality score and social engineering. I've watched Google do this relentlessly since…

Can you explain more what you mean by QS and social engineering being the way Google is raising prices?

My understanding is that AdWords is a an auction system, where your position in the auction is a combination of your Max bid, inventory, and a QS multiple. If Google is manipulating QS, it would just change the ordering of auction winners, rather than overall CPC, right?

My first thought was that prices are rising because 1) more competition on the ads [more companies, higher prices], and 2) as a kw cost/value saturates, more companies were "overpaying" [bidding more than expected ROI], due to any number of causes.

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