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Is Google Second-Guessing Itself?

Ad spike may reflect change in Google

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Times are tight. Heck, college professors are having to sell ad space on exam pages to make up for budget cuts. It would make sense that Google would increase the number of ads on its search pages, too, except it’s hard to forget certain executive speeches about fewer ads with better targeting.

So, reports that Google has upped the number of ads on search result pages by 75 percent might be a little jarring at first. Nicholas Carlson at Silicon Valley Insider thinks so, and thinks it has to do with Google “trying to dig up revenues anyway it can” in Q4. Meeting or beating expectations is vital to Google’s stock price, and part of that, in addition to cost-cutting, is more ads in more places.

Is Google Second-Guessing Itself?

At a glance, it appears the spike in ads correlates with the holiday season; it also correlates with the economic downturn, which just happens to come at the worst time of the year. Yes, Q4 of 2007 also showed a peak in the number of ads per page. But, if AdGooroo’s numbers are correct, the number of ads popping up this year reflects a nearly 55 percent spike over last year.

Is Google Second-Guessing Itself?

The jump quintuples the increase seen at Yahoo, and nearly doubles Microsoft’s 4Q increase. This wouldn’t be all that surprising if wasn’t that just last Spring Google waxed about new formulas that better served advertisers and users simultaneously: fewer ads with higher cost-per-click and higher ROI. This was to be the new Google strategy.

But as soon as times got tough, Google seems to have gone back to the old standby: give as many opportunities to click and as many opportunities for advertisers to pay as possible. It’s reasonable to counter that in uncertain times businesses must more aggressively market and promote their wares, hence a spike in advertiser demand for space.

Such demand didn’t faze Google last Spring, though. GOOG didn’t open below $300 back then either. So what gives? Is Google repealing its most recent ad-serving philosophy?
 

 

Is Google Second-Guessing Itself?
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  • http://www.groundfloorseo.com/index.php/2008/12/09/google-adwords-says-beer-for-everyone/ Ant Onaf

    Google has definitely been making changes to make up the difference. It seems Google is having its own troubles evading economic hardships. As of recent Google Adwords has opened up its ad space to marketers of alcohol and beer. This to me says a lot, Google is trying to find a sizeable market to profit from. I assume next it would be gambling/casino or guns/ammo. It also seems Google Adwords quality scoring has been playing against them in a down economy, because businesses don’t have money to throw away any longer and if they can’t get a click at the price they want they are not willing to pay the high $5.00 or $10.00 per click for an non-guarantee of a sale — even larger advertisers are spending more wisely. Especially, since nowadays you have hundreds of other PPC networks undercutting that click cost.

    You want to charge me $5.00 per click because you say the quality of my ad (or landing page) is not up to par, but then I find my ad being displayed on a page which has a lot less quality or isn’t a good target for my ad! Double standards. I understand supply and demand, but seriously how much is a CLICK really worth??

  • http://fightface.blogspot.com/ Fight Face

    Is this why they have suddenly loosened up their polices on gambling ads in the UK and now beer, hard alcohol and liquer?

    Amazing.

    • http://www.ukhost4u.com/basic.html Cheap Host

      But if you look at when they rolled these out, they certainly correlate!

  • http://www.policyrenewal.co.uk jasonm

    I have recently stopped my CPC account because as mentioned above by ANT, even though i have specified where i want my ad displaying, i have found my add on gambling sites, link farms etc. In my industry and especially in the UK (insurance) the cost per click is average around

  • Guest

    Google rip continues

  • http://www.trainingreiki.com/reiki-books.php Chikara-reiki-do

    wow..I knew insurance business was very expensive but at 90$ a click seems exagerated. Are we talking about search or content here? I find it hard to believe that, sorry
    I used to pay around 5-6$ in law/bankruptcy niche on search so 90$ seems way too much here

  • http://www.ezwebsitemonitoring.com/ EZ Website Monitoring

    That’s quite the jump from quarter to quarter.. Nice graphs!

  • http://www.squashedapple.co.uk Carlo

    Leave CPC

    I am always finding the ways how to improve CPM significantly, though I am satisfied by CPM with me, but how could it be enhanced more?

    I think one of the major CPM enhancer is choosing the genre/niche of the site and the keywords on the page! Organic search traffic enhance it and of course quality content on the site which is able to engage the reader there for more of the time length!

    But one thing s ABSOLUTELY CLEAR Adsense