Google to Stop Serving Right Rail Ads
March 1, 2016 · Industry Developments
So, Google AdWords rolled out its biggest changes since its inception this past week: the removal of right rail ads on desktop, barring the exceptions of Product Listings and Knowledge Panels. To compensate for this removal, Google will now show three ads on top of the page, and four for ‘commercial queries,’ such as insurance, hotels etc. Three ads will also appear at the bottom of the page, below organic listings. Many digital marketing experts are seeing it as the search engine giant’s move towards mobile-first, and giving users a similar experience across platforms. The important question though is: how will it affect your existing and new PPC campaigns? Will your CPC and CPA rise? What about CTR?
While the change is still very new for any comprehensive data to be available, here are some of the potential outcomes of this change:
Impact on CPC
While some argue that limited ad real estate would push CPCs skyward, others believe that more impressions for top spots might actually see a downward spiral in cost-per-click. However, it also depends on how much those in online advertising are willing to pay for ads at the bottom of the page.
Historically speaking, ads on the right-side accounted for less than 15% of total clicks. With ads at the bottom of the page being below the fold, they are likely to attract even lower impressions and click-through rates. Thus, advertisers might bid higher for top slots, which could increase CPCs.
However, if this post from search marketing team Wordstream is to be believed, there is hardly any fluctuation in CPCs due to this seminal change.
Impact on CPA
CPA is directly related to your Quality Score. With limited real estate, ads with a very good Quality Score will get the top positions; which means you need to concentrate on improving your Quality Score too. As that happens, you might see CPAs declining.
However, limited real estate could also mean that the general cost of advertising on Google will be higher. That might push advertisers to bid on fewer keywords, which could mean the cost of exact match keywords will increase. In such case, your CPAs might rise.
What you can do to optimize CPA/CPC?
Quality Score gains even more importance with this change. Thus, improving your ad copy, keyword relevancy, and landing pages are the first steps you can take for optimal CPCs and CPAs.
Overall, CTRs are likely to improve, which may offset the higher CPC you might have to pay. Wordstream’s initial SEM data suggests as much, with the third ad position commanding a 15% higher CTR.
Wait and watch is probably the best strategy as of now.