Google Site Targeted AdSense Update

So I had about a half million ad displays since I started the Google site targeted ads. Still no sales from it, but good market data.

The wider your keyword set is the better your chance of being able to lower your per click costs. Doing site targeting makes sense if you have rich business models or are trying to target niche low volume sites, but otherwise it can be far more expensive than large contextual keyword based ad sets.

Some of my term based contextual ads have an effective CPM of around 16 to 20 cents, but the site targeted ads have a $2 minimum price.

You can't know for sure if your site targeted ads are a completely accurate measure of traffic volume because:

  • they are only going to show on some pages with lower earnings potential

  • different sites and site formats are better at monitizing content
  • your overall daily budget might be too low
  • your CPM bid might be too low
  • some sites use multiple ad units

Despite the above I believe many of the anomalies offset each other a good bit. It is interesting to see that the traffic volumes drop off logarithmically from site to site.

Digital Point gets amazing traffic. In a single day I had over 26,000 ad displays on Digital Point. Some of the smaller SEO forums only displayed a few hundred or few thousand ad displays.

Andrew Goodman sees CPM as eventually phasing out the CPC model:

Other than trying not to antagonize webmasters who have been making a living off AdSense, I can't think of very many reasons for Google keeping the old version of content targeting around. I think that very soon it will become evident that the old content program is merely being grandfathered for a set amount of time so as not to confuse or upset publishers and advertisers. Phasing out the old program will perhaps lead to a slackening of revenues, as with any painful economic transition. In this case, the transition can be boiled down to moving advertisers dollars from bad publishers to good ones. In the long run, that should strengthen the fundamentals of online advertising and attract more advertisers to the party.

although I don't see that happening anytime soon. What makes Google's business model so powerful is the extreme targeting and allowing small advertisers to participate. I can't see them wanting to outright punt on that anytime soon. The only way they will do that is if click fraud gets tons of exposure, or if the cost of policing the small sites outweighs the returns.

Even if the small sites are a break even proposition, keeping them in the AdSense system means:

  • free exposure for the AdSense program

  • Google gets to boast about their program being so much larger than any competing contextual ad network
  • If Google's ads are on the page then some other network's contextual ads are not.

The smaller niche channels tend to have a slightly greater CTR than the larger more well known sites. People moved to search because it was so easily trackable and targeted, but the $2 minimum on branding ads will keep some people away from participating in the brand ads.

While people may not realize the value of the small niche sites I believe their traffic quality is higher than the more well known sites since they are harder to get to (read as: what leads get there may be more prequalified). I had decent clickthrough rates on many of the smaller SEO forums & blogs (some averaging about 2 to 3 cents per click), whereas the clickthrough rates on the larger & more established sites were typically much lower.

I (at least temporarily) ended my site targeted AdSense ad campaign a few days back because I think there are far more effective ways I could spend money to promote this site, but for some business models the site target ads probably make great sense.

Published: July 2, 2005 by Aaron Wall in contextual advertising


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