Adwords: Get Ready for Price Gouging from the Mystery Factor

17 comments

Back in December Google Adwords announced they would be evaluating your landing pages with a quality score. Today on the Adwords blog they announced are turning the dial up a notch and some publishers may see a price increase:

As you may recall, we began incorporating advertiser landing page quality into the Quality Score back in December 2005. Following that change, advertisers who are not providing useful landing pages to our users will have lower Quality Scores that in turn result in higher minimum bid requirements for their keywords. We realize that some minimum bids may be too high to be cost-effective -- indeed, these high minimum bids are our way of motivating advertisers to either improve their landing pages or to simply stop using AdWords for those pages, while still giving some control over which keywords to advertise on. Although it is counter-intuitive to some who hear it, we'd rather show one less ad than to show an ad which leads to a poor user experience -- since long-term user trust in AdWords is of overarching importance.

From time-to-time, we improve our algorithms for evaluating landing page quality (often based on feedback from our end-users), and next week we're launching another such improvement. Thus, over the coming days a small number of advertisers who are providing a low quality user experience on their landing pages will see increases in their minimum bids. It is important to note, however, that the vast majority of advertisers will not be affected at all by this change, as they link to quality landing pages.

IMHO this is a step aimed at squeezing the profits out of the arbitrage model. However I've also seen it come into play and make it impossible to break into new keyword areas due to ridiculous pricing. The problem of course is in the definition of the Quality Score

This is the basis for measuring the quality of your keyword and determining your minimum bid. Quality Score is determined by your keyword's clickthrough rate (CTR) on Google, relevance of your ad text, historical keyword performance on Google, the quality of your ad's landing page, and other relevancy factors.

Since Web 2.0 is all about clarity I'll spell it out for you. Hey Adwords how about quantifying what you actually mean by "quality of your ad's landing page, and other relevancy factors". What are you using to determine this quality? Are you looking for specific text, are you looking for a 'buy button', are you looking for affiliate ads? I mean really it's so much easier if you say we are looking for X, Y, and Z instead of me hoping the magic 8 ball comes up with "outlook good" instead of "Don't count on it".

You've got people looking at the ads anyway so rather than jack the price up how about disapproving the ones that that actual humans think look bad. Since you're spidering the pages already, anytime you detect a significant change flag the ad for a quality re-review. That would ensure the quality of the system. That is of course unless someone wants to argue that letting me pay $10 a click to reenable my previously "low quality ad" is suddenly good for the users now that I'm paying more ...

Comments

Adword to Adsense busting

So in a nutshell, Google is trying to stop people from purchasing cheap Adwords that lead to pages that display high price Adsense ads?

Ah oooh! ;)

Ah oooh! ;)

Arbitrage Effect

I doubt this will make a serious dent to people who know how to arbitrage Adwords traffic to Adsense. It WILL most definitely further nuke the lazy bastards who try to arbitrage Adsense in standard domain parking templates. In fact, I would contend that the housecleaning of lazy arbitragers will lead to an uptick in earnings for those of us who send traffic to ads on pages of high relevance to Quality Scoring. It's like comparing institutional traders to somebody who sleeps till noon and "daytrades" in his boxers down at the local Schwab branch. Sayonara and good riddance.

Transparency

I'm with Graywolf: "Hey Adwords how about quantifying what you actually mean by "quality of your ad's landing page"

Some clarity, Google, please. What, exactly, do you want to see? What are we supposed to be telling clients?

Just one more reason

Yet another reason to cancel your Google Adwords.

Man I hate Google, but they

Man I hate Google, but they can't stop me. 100 PhDs thinking together is less dangerous than one above-average intelligence arbitrager.

Good luck Gooholes.

Q2 Projections

This is ALL about goog fearing it can't meet it's 1Q 2006 and 2Q projections. They missed their 4Q 2005 and their stock nearly tanked (went from $475 to $320 in a matter of days).

FuckedGoogle may have been a scam :-/ but GOOG seriously is hyperinflated. How much has GOOG's business model and traffic changed since November 2005? I would say their traffic hasn't increased 15% (as they claim their profit has), that fewer people are clicking on ads, and that fewer adsense buyers exist. I would say 100% of their increase in profit is from shady areas (GoDaddy using AdSense on their parked domains, gouging existing ad buyers, etc).

GOOG is doomed, the only question is how soon, and at $420 the sooner the better; more money is tied up in it than the entire economy of Germany.

CPA

Maybe it's about CPA - Motivate sellers to improve their landing pages to (actually) close sales = more income, and publisher-participation.

Disaster

I just get the feeling this will turn out to be something that will hurt regular advertisers more than arbitrage guys. Guys doing arbitrage will adjust, they aren't dumb.

Anyone seen

any effects of this yet?

re Mystery factor? quantifying?

I'm not so sure about you guys, but how about that last paragraph in that aforementioned Adwords blog post?

Quote:
If you do see an increase in minimum bids and you feel that your landing page is providing a great user experience, please contact AdWords support and we'll take a look. Also, for useful guidelines which will help to define what users look for in a high quality site, we hope you'll take a look at the landing page and site quality guidelines, from the AdWords Help Center.

Unless that last bit was only put in after the fact, does that help to address your concerns a bit? (I have no stake in Google, btw). Granted, it's not true "hard and fast science", but I thought it might go some ways towards addressing that "lack of definition" factor here.

Interesting ...

... that one of their guidelines is

"Distinguish sponsored links from the rest of your site content."

Yet the Adsense Help section on color palettes advises:

"Many publishers have found that visitors are more likely to see and click on Google ads when the ads themselves blend cleanly into a site..."

Do the Adsense people and the Adwords people talk to each other much, I wonder?

re Interesting ...

well hey, perhaps that's just for landing pages only? :)

"If users don't quickly see what they clicked on your ad to find, they'll leave your site frustrated ... (and may never return to your site or click on ads in the future. Here are some pointers for making sure that doesn't happen)"

Users Vs Bots

>Also, for useful guidelines which will help to define what users look for in a high quality site

My emphasis, the quality score isn't determined by users it's determined by the mystery algo read by the bots.

No one has answered the question how paying more for an ad that was previously deemed low quality is suddenly good for anyone except google.

Re: Interesting

Like grayhound said, it's just the landing page that's taken into consideration. And I think it's possible to blend in the ads while distinguishing them from the actual content.

I think it's all about the design and layout of the page. Blend in the ads as in make sure the placement and color of ads are in line with the page design and won't make them seem out of place and/or cause reading difficulties.

And to distinguish ads is to make sure you don't confuse or even deceive readers that the ads are part of the content. Because you might have sponsored links from sources other than AdSense.

Just my $0.02.

re Users Vs Bots

thanks, graywolf, for clarifying your stand.

After re-plying, and re-thinking, and re-reading... I finally get your point. I guess they should really get a human to do the quality evaluation after all, but the only problem is, how efficient is that...

> No one has answered the question how paying more for an ad that was previously deemed low quality is suddenly good for anyone except google.

well hey, if you're talking about PPC, that's good for the publisher as well. And if you're talking about CPM... well hey that's good for the publisher as well! Well how about the reader/user then? Well if that algol (whatever it is) that is used by the bots is any good at all, perhaps this will help to weed out some of the low-lying trash... But of course yes, Google does stand to benefit as well (rather quickly and rather directly) from a price increase...

And the alternative would be? (and here I begin to see where you're going) To do exactly as you suggest - flag a page for re-review only after it has been deemed to change sufficiently...

This is GOOD for SEM's

It is very easy for B&M businesses to burn through hundreds or thousands of dollars each day on Adwords. Now, it's even easier.

Managing Adword campaignes should be a booming business.

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