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Breakdown of Top Ad Placement: Before and AfterPosted by John on August 28, 2007 in Google AdWords |
Google’s Top Ad Placement formula change took effect last Wednesday. Within 2 days of the shift, I began to read posts like this one where advertisers began calling out negative effects to their AdWords accounts with no hard data to back it up. The entire team here at PPC Hero felt that we needed to analyze our own data before deciding to agree or disagree.
To test, I chose three clients with an average position in the top 3. The three clients chosen: Client A is a book publisher, Client B is in medical devices, and Client C is a musical instrument retailer.
Before I present the findings, I should point out that this test isn’t 100% scientific! The after data contains weekend figures which vary and fluctuate considerably compared to weekdays. Additionally, the figures were taken from a sub-section of each client - from a single ad group on the search network only (no content network!). The time span for the data includes the 4 days before the formula change (08/18-08/21) compared to the 4 days after (08/23-08/26).
This data was pulled from AdWords reports run for the time period between 08/18 and 08/26. I added a filter for Ad Distribution to filter out all content network data. At that point I simply summed the data segments in Excel and recalculated the Click-through-Rate and Avg. Position formulas to be accurate for the chosen data.
For clients that are managed by our agency, positions 4-5 consistently provide higher ROI and we manage our clients accordingly. So, this made available data for positions 1-3 difficult to come by. Has anyone else run a similar test with ad groups that generate heavier traffic in the top 3 spots?
|
Top Ad Placement Stats |
Impressions |
Clicks |
Click-through-Rate |
CPC |
Cost |
Avg. Position |
|
|
Client A |
Before |
10317 |
544 |
5.27% |
$1.21 |
$656.37 |
2.8 |
|
After |
7902 |
397 |
5.08% |
$1.30 |
$514.98 |
3.0 |
|
|
Client B |
Before |
7013 |
574 |
8.18% |
$0.05 |
$26.64 |
1.5 |
|
After |
9174 |
717 |
7.82% |
$0.05 |
$38.38 |
1.7 |
|
|
Client C |
Before |
6901 |
434 |
6.29% |
$0.38 |
$164.40 |
2.1 |
|
After |
7329 |
393 |
5.36% |
$0.31 |
$122.19 |
2.5 |
|
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It should be noted that all of these clients were already in the top 3 ad spots prior to the formula change. Big things to notice:
- All three clients actually lost ground in Average Position after the formula change, but remained in the top 3.
- They all decreased in Click-through-Rate as well (all within 1 percentage point).
- Clients A and C lost Impressions and Clicks while the lone ranger, Client B, did see a definite jump in Impressions and Clicks.
- However, based solely on Avg. Position and Click-through-Rate, I would say that the formula change had a generally negative effect.
In another 30 days, I will run this test again and follow up. At that point, the “fallout” from this formula change should allow me to answer these questions: Did I have enough data? Did time allow these ad groups to regain balance? Did the stats stay the same? Did the stats get worse? Check back in for answers to these questions and a recap of Google’s Top Ad Placement change a month out.
August 29th, 2007 at 11:44 am
Hi John,
I’m still waiting a while to analyze my own client results, but thus far the change has been a positive one in terms of position, and too close to tell in terms of ROI. In most of my client’s campaigns, I’ve seen an increase in average CPC that coincides with an increase in position (sometimes dramatic). These increases in Adwords generally brought about an increase in revenue, which more or less negated the cost increase. However, this can be a result of (as you said) the weekend factor, going into a long weekend, going into the end of the month, etc. I’ll probably follow-up with findings sometime next week, using a full week’s worth of data.
Garry
August 29th, 2007 at 2:24 pm
[...] Breakdown of Top Ad Placement: Before and After, PPC Hero [...]
August 29th, 2007 at 2:38 pm
This is a very good idea. My company bids on a couple of #1 spots, including some that are very competitive in our industry.
I’m going to run some reports of my own and see what I notice.
August 29th, 2007 at 4:54 pm
[...] Breakdown of Top Ad Placement: Before and After, PPC Hero [...]
August 29th, 2007 at 11:01 pm
[...] Breakdown of Top Ad Placement: Before and After, PPC Hero [...]
August 30th, 2007 at 9:36 am
Good to know.
I don’t believe the top positon is always the best on PPC. Dropping to 3rd or 4th can bring a lot more business sometimes.
October 1st, 2007 at 8:26 am
[...] On August 22, Google updated the ranking formula that determines which ads make it into the top 3 spots. After only 4 days, I ran reports for 3 different ad groups (3 separate client accounts) to determine if this change had affected my average positions or any other important metrics. Within the scope of my initial comparison, all three ad groups had seen an obvious decrease in average position and click-through-rate despite remaining in the top 3 ad spots. [...]