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Google Changes Side Bar Advertising

By March 1, 2016Uncategorized

Have you noticed anything different with Google ads? They have just began the change to the landscape of the paid search ads on the results page. The process rolled out Friday, Feb 26, 2016 as searches for high-volume keywords no longer produced ads via the right hand side, rather up to four ads above organic results and the rest pushed toward the bottom of the page. Google has indicated that searches that are critical to retail and lead generating clients, a 4th paid ad will sometimes be added to the results of the left side.

While some reports have said the change is indicative of Google’s push for mobile, this really has to do with the impact on a user’s search experience on their desktop. In the past, Google has tested and implemented changes to the mobile search interface to give users a better, more seamless experience, and have urged advertisers to take advantage of the changes to optimize conversions. But eliminating the side rail ads is something wholly different; it will not only change the consumer’s desktop experience, but it will leave them with less options, which could potentially not do well for advertisers or Google.

The driving motive of this update is pretty clearly stronger ad performance. The addition of another ad to the crucial “above the fold” area will offer the opportunity to pay for a more premium position. And while this may in fact increase performance of those ads, it’s may also hurt ads that fall below organic.

Obviously, the largest concern is that it will absolutely drive up costs.  Bid competition for the top 4 placements for brands’ top keywords will likely escalate immediately, as position-based strategies become more critical for exposure and traffic. Advertisers who can’t afford the top placements on the results page may take a pretty substantial hit to their click-through-rates (CTRs). An addition of a fourth ad on the top will also push organic listings further down, something that has been happening fairly consistently over time. Brands will have to pay more and more for paid ads to compensate for the decrease in traffic from their free, organic listings.

No doubt there will be an impact on revenue for the advertiser, but how will Google’s revenue be impacted?