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I don't think it's that simple of a hypothesis to verify, even inside Google. There are lots of reasons why CTR may be constant or go up despite fewer people co

I don't think it's that simple of a hypothesis to verify, even inside Google. There are lots of reasons why CTR may be constant or go up despite fewer people converting through ads. Examples are bots, crawlers, more kids playing with iPads, or malicious website design, e.g, I have clicked on ads because I was tricked on it by the HTML/JS, but that doesn't help the advertiser because I'm not going to buy anything. CTR only matters in the short-term. In the long-term, what matters is if the market of advertisers believes ads are profitable for them. If their CTR goes up 10x but they cannot verify conversions, they may eventually stop buying ads. That won't happen quickly, because attribution is so hard and you can never be sure where your conversions really come from, but the decline of ads may still happen over a longer time frame.

GeneralMayhem 4y ago
> Examples are bots, crawlers, more kids playing with iPads, or malicious website design, e.g, I have clicked on ads because I was tricked on it by the HTML/JS Google considers all of those spam, and goes to great lengths to detect them, refund them, and remove them from the stats. Changes in spam-cleaned CTR, which is what advertisers see and what Google talks about for aggregate metrics, should not be explainable with any of those. Also, even in the short term, CTR as a primary metric only matters if you're paying a fixed amount per impression on a fixed number of impressions - i.e., almost never, unless you're looking at a particular fixed subset of the network. If prices go down, e.g. because of adding enough new inventory to decreases auction pressure, or if you add new lower-CTR inventory in a CPC auction, then the total amount of ad spend can still go up as CTR goes down. Google-wide CTR has been dropping for years, mostly due to mix shifts. In particular, Youtube ads, which have lower CTR than search, have been growing a lot faster.
- AlbertCory 4y ago
  Thanks for the note about cleaning CTR. The Ad Spam team was large even in my day. As for "impressions" -- that's a term for content-based ads, not search ads. Search ads are enormously more valuable than banner ads.

GeneralMayhem 4y ago

> Examples are bots, crawlers, more kids playing with iPads, or malicious website design, e.g, I have clicked on ads because I was tricked on it by the HTML/JS Google considers all of those spam, and goes to great lengths to detect them, refund them, and remove them from the stats. Changes in spam-cleaned CTR, which is what advertisers see and what Google talks about for aggregate metrics, should not be explainable with any of those. Also, even in the short term, CTR as a primary metric only matters if you're paying a fixed amount per impression on a fixed number of impressions - i.e., almost never, unless you're looking at a particular fixed subset of the network. If prices go down, e.g. because of adding enough new inventory to decreases auction pressure, or if you add new lower-CTR inventory in a CPC auction, then the total amount of ad spend can still go up as CTR goes down. Google-wide CTR has been dropping for years, mostly due to mix shifts. In particular, Youtube ads, which have lower CTR than search, have been growing a lot faster.

AlbertCory 4y ago
Thanks for the note about cleaning CTR. The Ad Spam team was large even in my day. As for "impressions" -- that's a term for content-based ads, not search ads. Search ads are enormously more valuable than banner ads.