Showing posts with label Slope. Show all posts
Showing posts with label Slope. Show all posts

Friday, July 28, 2017

Are AdSense Publishers' Revenues on a Slippery Slope?

Are AdSense Publishers' Revenues on a Slippery Slope?

For the time being, countless web publishers are getting hit head-on by the "financial crisis" and it's unclear when things will head back up... if ever. Though, what seems to be a must, is web publishers will need to take action to recoup their lost revenues.

Fast forward in March of 2009, with a nasty recession hitting the US and many other "first world" countries, AdSense publishers are being hit by another revenue drop, this time, by the way of free falling effective cost per thousand impressions (eCPMs).

While the eCPM for a business blog might've averaged around $ 15 in January of 2009, something happened in mid-February that has been tanking the eCPM since. Nowadays, in March, the same profile is lucky to get $ 3 (of eCPM) instead of the usually very stable (over the last year, at least) $ 15 revenue threshhold.

Because of this, a typical publisher used to getting some $ 50 a day will likely get 5 times less and with a meager $ 10 -for the exact same number of valid clicks- to live by, which obviously isn't enough.
The world crisis is clearly visible on AdSense eCPM.

Experts say that the financial crisis will damage AdSense, but how dramatic the impact will be can't currently be said. What is certain, is publishers are unable to influence the negative advertiser trend, but some precautions might be taken to make sure that ads give the advertiser a high ROI.

However, despite the crisis, there is no reason for you to give up on your web site. If you are a blogger, continue blogging, develop your niche, and post relevant articles. Sooner or later advertisements will come, and maybe the ones that are relevant to your posts.

Google AdSense suffers like any other advertising service from the economic downturn. But in the short to medium term, due to its huge pool of advertisers and publishers, AdSense is also the service which is likely to cope with the crisis more effectively.

On October 31st, 2008 Google sent all AdSense publishers a reassuring e-mail. While admitting the negative impact the economic crisis was having on online advertising they said they would work to boost publishers revenues.

Google denies that clickthrough rates affect the price of an ad click, though they don't go into how much weight is put on user action beyond the click, i.e., sales completed, forms filled out, engagement on the site that follows. Google describes smart pricing this way:

"Google's smart pricing feature automatically adjusts the cost of a keyword-targeted content click based on its effectiveness compared to a search click. So if our data shows that a click from a content page is less likely to turn into actionable business results -- such as online sales, registrations, phone calls, or newsletter signups -- we reduce the price you pay for that click."

Adsense wasn't around during the Dot Com bust, so there isn't past precedent to go on. We can only speculate.

So considering a hypothetical recession, is AdSense relatively immune? Or will publishers feel the pain? I can't be the only one wondering, but I don't feel I have any insight on it. I don't think Google itself will be in any serious trouble, but advertisers may be another story. One can imagine shrinking advertising budgets. Conversely though, perhaps shrinking budgets could mean advertisers who left the content network would give it a second look, given the higher cost of search. The MFA shake-out might've been well-timed for this.

Maybe this is too speculative?

Ashwin P is an internet affiliate marketer. He has helped hundreds of people to start their own affiliate marketing business.