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Do you happen to know the reason? Are more ads being served in countries with lower prices? Or is it due to competition?

by Hermel 12y ago

itry 12y ago
My guess is that the clicks are worth less these days for two reasons: 1) The ads are now displayed so prominently that everybody has to notice them. Earlier, they where less prominent and more clearly marked as ads. So there is probably a shift in demographics. Less dedicated buyers and more people who just stumble upon the ad. 2) On tablets and phones people might a) misclick more and b) surf more without the intend to buy.
- CaveTech 12y ago
  I'm unsure if misclicks/clicks without intent would drive down the cost of CPC. In the short term, they'd definitely drive up the price. It's possible that lower conversion rates after the click would lead people to put in smaller bids, but I'd say thats unlikely. There's no shortage of people willing to buy ad space with high click throughs.
CaveTech 12y ago
Probably due to a lot of factors, but the biggest one is likely ad blindness - People just don't notice Ads anymore. It's especially prevalent in kids but it's probably also taking ground with adults now too.
- wutbrodo 12y ago
  This would have nothing to do with the effect shown. Paid clicks (i.e. the number of actual clicks on ads) have been growing rapidly over the same time period. Dropping CPCs are pretty obviously a result of the mix shifting to mobile (particularly since both mobile and desktop CPCs are rising).
- rahimnathwani 12y ago
  That would be reflected in CTR rather than CPC.
- chillingeffect 12y ago
  > ad blindness This is so true. I went to advertise on reddit the other day and was surprised when I realized that the ads I was buying were for the "Sponsored Links" at the TOP OF EVERY PAGE, but I trained myself to not see them 5-6 years ago and hadn't really seen them since. /scratches head.
runako 12y ago
Mobile has lower rates. Expansion of ads to countries with lower rates. Both increase the overall reach & revenue of Google ads, but lower CPCs.
gcb0 12y ago
internet ads become king when advertisers were promised fine grained targeting. then cpc become kink when everyone realized advertising based in demographic was not generating returns for the brands, because in the internet nobody knows you are a dog. so everyone spend all their money on cpc, because they were told that was the metric to follow. until they realized it also does not result in conversion. then they start spending all their money on conversion, and realized they had to give away all their profit per conversion. then they briefly guessed that going back to before cpc was good, and everyone dumped their money on ad networks and paid cents for million of impressions god knows where. turns out those impressions were all in russian warez sites and porn. now everyone is spending all their money on viewable impression. until they realize no browser allows for a real world implementation of this, and even if they did, in the end it is exactly the same as buying the more expensive placements on impression based publishes. but this is still beginning, so we are here. everyone is dumping their money on this this week oh and every step, after the premium bands got tired of the new thing, the publishers being stuck with it, start a race to the bottom on price.

Do you happen to know the reason? Are more ads being served in countries with lower prices? Or is it due to competition?

by Hermel 12y ago

Do you happen to know the reason? Are more ads being served in countries with lower prices? Or is it due to competition?

itry 12y ago

My guess is that the clicks are worth less these days for two reasons: 1) The ads are now displayed so prominently that everybody has to notice them. Earlier, they where less prominent and more clearly marked as ads. So there is probably a shift in demographics. Less dedicated buyers and more people who just stumble upon the ad. 2) On tablets and phones people might a) misclick more and b) surf more without the intend to buy.

CaveTech 12y ago
I'm unsure if misclicks/clicks without intent would drive down the cost of CPC. In the short term, they'd definitely drive up the price. It's possible that lower conversion rates after the click would lead people to put in smaller bids, but I'd say thats unlikely. There's no shortage of people willing to buy ad space with high click throughs.

CaveTech 12y ago

Probably due to a lot of factors, but the biggest one is likely ad blindness - People just don't notice Ads anymore. It's especially prevalent in kids but it's probably also taking ground with adults now too.

wutbrodo 12y ago
This would have nothing to do with the effect shown. Paid clicks (i.e. the number of actual clicks on ads) have been growing rapidly over the same time period. Dropping CPCs are pretty obviously a result of the mix shifting to mobile (particularly since both mobile and desktop CPCs are rising).
rahimnathwani 12y ago
That would be reflected in CTR rather than CPC.
chillingeffect 12y ago
> ad blindness This is so true. I went to advertise on reddit the other day and was surprised when I realized that the ads I was buying were for the "Sponsored Links" at the TOP OF EVERY PAGE, but I trained myself to not see them 5-6 years ago and hadn't really seen them since. /scratches head.

runako 12y ago

Mobile has lower rates. Expansion of ads to countries with lower rates. Both increase the overall reach & revenue of Google ads, but lower CPCs.

gcb0 12y ago

internet ads become king when advertisers were promised fine grained targeting. then cpc become kink when everyone realized advertising based in demographic was not generating returns for the brands, because in the internet nobody knows you are a dog. so everyone spend all their money on cpc, because they were told that was the metric to follow. until they realized it also does not result in conversion. then they start spending all their money on conversion, and realized they had to give away all their profit per conversion. then they briefly guessed that going back to before cpc was good, and everyone dumped their money on ad networks and paid cents for million of impressions god knows where. turns out those impressions were all in russian warez sites and porn. now everyone is spending all their money on viewable impression. until they realize no browser allows for a real world implementation of this, and even if they did, in the end it is exactly the same as buying the more expensive placements on impression based publishes. but this is still beginning, so we are here. everyone is dumping their money on this this week oh and every step, after the premium bands got tired of the new thing, the publishers being stuck with it, start a race to the bottom on price.