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Bidding On Top Ad Spot A Waste of Money?

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All sponsored search listings are created equal, or so decrees Brandt Dainow, CEO of ThinkMetrics and Internet ad veteran, after reviewing click-through trends over the past three years. In a nutshell, you can start saving money by not bidding on that top spot. Others, like Enquiro’s Gord Hotchkiss, aren’t convinced.

Curious to see if searchers had become more discriminating over the years, Dainow pulled three years worth of click-through stats (well, three years worth of Christmas season stats) for his campaigns. He compared 1,500 pairs of keywords for each month, their average position in the SERPs, and corresponding click-through rates.

The results, when graphed, did seem to trend toward a more discerning search populace that may actually read the text ads, rather than blindly clicking on the first (or top) ad on the screen. This indicates the greater importance

“By 2006,” he writes, “things had changed considerably. While there is some advantage to the number one and number three slots, all positions in the listings show roughly the same clickthrough rates. . .

“What this tells me is that the days are gone when paying more for an ad’s position could be justified by increased traffic. There is no longer any value in paying more than someone else to place your ad above theirs.”

Hotchkiss was quick to put the breaks on this idea, looking back over his own metrics, and pleading for more evidence to support such a bold conclusion.

“This runs directly counter to all the research we’ve done, and also that done by others. . .” he writes.”This runs counter to our eye tracking, which showed a strong correlation, primarily on first page visits. Top sponsored ads on Google received 2 to 3 times the click throughs.”

Hotchkiss notes that Dainow’s results are limited to his own campaign and that it may be premature to draw such conclusions. But they are in general agreement that “relevant and compelling copy does make a huge difference in the click-through rate of the ad.

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