A while back we announced the fact that Google was removing right hand ads:
Many were concerned that this could have a negative impact on SMEs using AdWords to promote their business on Search Engines Results Pages (SERPs). We took a look at that too:
Following on from our full data analysis of the impact of the SERP changes across our advertiser base we have (as promised) been crunching the numbers and analysed the impact over a longer time range on Click Through Rate (CTR) for our data set.
CTR By Position
There have been noticeable changes in CTR based on position over the last 30 days; position 1 and position 4 have a strong correlation, resulting in a reduction CTR across position 1 immediately after the SERP change. Then, we see a gradual increase over the next 14 days with CTRs gradually reducing again as results stabilise.
The conclusion of this, however, doesn’t necessarily mean that the SERP change is to blame. If we look at impressions by position we can see that following the February change there was an immediate clamour of advertisers to get in position 1 (probably fueled by position 1 SERP scaremongering….mobilegeddon anyone?) With so many advertisers across our base pushing for position 1, the CTR didn’t necessarily improve for everyone.
And this affects your wallet how…?
Well, we can see that overall there has been a general CPC increase across the board for position 1, with its peaks in line with the clamour we saw in the graph above. Conversely, we see that position 2 has actually seen a gradual decrease in average CPC.
How can that be? Surely, if everyone is bidding more it’s making it more expensive for everyone, right?
Not necessarily. With advertisers competing more aggressively for position 1, a common theme we’re seeing is advertisers limiting themselves by budget and missing out on auctions all together, giving the savvy advertiser more room and value in position 2 once less tactical advertisers have expended all their budget fighting for vanity!
One thing that might drastically change this is Google’s changes to AdRank and ad formats which will mean that the higher the ad shows the more likely all extensions will show, this will have a massive impact on CTR and we’ll be doing a follow-up post on that and impression share analysis later this week. Check back for more!