Google continues to shake up the SERP's with the latest update from Adwords, their PPC platform. This latest change removes the sidebar that previously housed ads from advertisers who did not show up in the coveted, top 3 ad positions. Announced February 19, 2016, but began rolling out a week before the formal announcement and has been in testing for several months before that.
With the sidebar now gone from the search results, a maximum of 4 spots are now available at the top of the page above the organic and map results. In addition, there are another 3 spots available for advertisers below the organic listings at the bottom of the page. These bottom three listings, which were not previously eligible, can now display ad extensions, except for "Call Now".
These changes not only cut out a decent chunk of available real estate for advertiser listings, but with the introduction of 4 top listings, they have managed to push organic results even further down the page.
When these changes were announced, there was a lot of speculation in the PPC community on how these would affect click through rate, cost per click, quality score and positioning. Now that we’ve had a few months to gather data, we can begin to delve into how these changes have effected paid search efforts.
Click Through Rate
We’ve seen an increase in click through rate across the board with most of our clients. This makes sense since now there are less options to choose from. The addition of ad extensions in the lower listings has also helped increase click throughs on ads that would otherwise have poorer engagement than their top of the page counterparts.
The average position increased as well, due to the decreased amount of available ad positions. However, we’ve noticed that this number may not be as accurate as it once was. With the removal of the sidebar we’re not seeing a lot- if any average positions greater than 4. So while still beneficial, take this data with a grain of salt when trying to determine how well your ads are positioned.
This metric has increased as well, undoubtedly due to the increase in relevance of the ads and increased click through rates.
Cost Per Click
This is one of the few metrics we saw that varied drastically depending on the client and the industry. Following the removal of the sidebar, we saw a lot of advertisers in certain industries drop out completely from the auctions. They were unable to compete in a vertical with less real estate. This helped reduce the CPC for advertisers already positioned in the top 3 spots.
Other industries have seen higher CPC’s due to the limited positions and the increased competition to secure a spot in the top 4.
While disruptive to some, this update is a positive change overall and opens up more room for Google’s shopping results as well as knowledge graphs on desktop searches. Another important thing to keep in mind is that this is not the only change Google has planned for paid search this year. They have just recently announced character limit increases to the headlines and descriptions that will further increase paid’s footprint in the SERP’s.
Stay tuned as we breakdown Google’s next announcement and continue to monitor the effects of their latest update.