By: Raymond Hackney
With a disappointing earnings report and revenue at their lowest point in 3 years, Google will be unveiling a new program that was reported today in the New York Times.
Mobile clicks cost less and that is affecting the bottom line at Google, they have mentioned this before and other companies such as Demand Media have previously written in their public filings about lower mobile clicks on their web properties.
Google thinks they may have the answer, and that is to make changes to Adwords announced in February, mandatory.
From the article:
Google had seemed to have finally found a solution to the riddle, by making the biggest-ever change
to its AdWords advertising product. The new program, called enhanced
campaigns, which was introduced in February and will be mandatory for
all advertisers on Monday, gives advertisers less choice about
advertising on mobile devices by automatically including desktop, tablet
and cellphone ads for all campaigns. Advertisers can choose not to buy
cellphone ads but are required to buy tablet ads.
Google says that this simplifies the process for advertisers and makes
it easier to reach customers who use devices indiscriminately. More
important than the type of device, the company says, is whether someone
is at a desk or on the sofa, in the mood to shop or eat.
But it also means that the price of mobile ads, which has been about
half that of desktop ads, will most likely increase. Google’s ads are
sold at auction, and one reason mobile prices have been low is that
there has been less demand. Enhanced campaigns should change that.
For example, the cost per ad click, known as C.P.C., for clients of the
Search Agency, a search ad firm, rose 22 percent in the quarter, largely
because of Google’s ad-buying changes. It was the first time that
tablet ads cost more than those on desktops, and advertisers increased
spending on smartphones 25 percent, the most of any device category.
You will find more statistics at Statista
Who knows if that will be the answer and who knows how advertisers will react to it being mandatory.
I still think that Google’s main fault was disallowing affiliates ads display on Adwords (somewhere in 2009 I guess) and banning those Adwords accounts. Therefore losing huge market and big money (even for Google). Especially knowing that Adwords is Google’s main cash flow source.