Fun Fact #9
It’s been more than a year since Google stopped showing ads on the right-hand side of desktop search results, and added a fourth row of ads above the organic search results. Comparing click-through rates for each position before and after the change, we can see that click-through rates have increased for all positions above the organic search results, with positions 3 and 4 seeing the largest gains. — Accuracast
Where it All Began
In mid-February of last year, Search Engine Land got a mysterious tip-off from an anonymous Google insider who confirmed that Google would be removing the right hand side desktop ads that had become so familiar to searchers by that point. The now defunct right side ads would instead be replaced with an extra text ad in a new fourth position at the top of the search results page for ‘highly commercial queries‘ – aka search queries with high purchase intent. This change would also include three additional ads at the bottom of the page, capping text ads to a maximum of seven instead of the previous possibility of up to eleven ads.
While the dramatic change had been spotted here and there all the way back to 2010, this was the first real proof of the soon-to-be hotly debated shift in ad positioning around the world in all languages. Some industry experts were worried Google was sacrificing user experience for profit, while some SEOs were worried their organic results were slipping further out of their grip, some search marketers were panicking that CPCs would go through the roof, while others were content to sit back and watch the data roll in as the change rolled out.
A month after the change, Search Engine Watch released its early findings and found:
- Less ad spots available resulted in a 19% decrease in total inventory
- The impact of the 4th position minimally increased traffic to positions 3 & 4 in the top ads
- CTR was up 12% and CPCs down -11%, showing users were responding positively to the change
One Year Later: What the Accuracast Study Found
More than a year after the big change and with access to much more data, Accuracast released their findings from 2 million searches across a random set of accounts on what the shift to the fourth row meant for SEM and search results in general.
Comparing click through rates from the 12 months before and after the loss of the right side ads, they found that all of the top ads saw significant gains in CTR, particularly position 3 and the upgraded position 4. Only position 5 saw a slight decrease, but in light of its placement far below the top ads and underneath the organic results, it was a minimal change.
Google’s gamble has definitely paid off! If you consider this in monetary terms, it represents a huge jump in profitability from search advertising. Moreover, most regular users either didn’t notice the change or didn’t mind it, and they continue using Google to search more and more every month. — Accuracast
How Did Our Own Findings Play Out?
Nearly a month after the big change was implemented, our team looked at a very large, varied and representative sample from 90,000 PPC campaigns to make some early observations on what it all meant for paid search marketers. The post was an extremely hot topic and generated a great deal of discussion between some of the great search minds in the industry.
Our initial conclusions from the study were:
- Impressions and clicks below the top 4 dropped significantly
- CPC for spots below the Top 4 increased and CTR decreased
- CPC for ads in the Top 4 increased by as much as 10.5%, and CTR increased by as much as 4.5%
- PPC campaigns optimized with machine learning algorithms outperform all other campaigns (BBM-optimized campaigns were faced with a slightly higher CPC than before the change, but a 41% lower CPC increase than the campaigns that were not optimized)
So how did our early findings stack up to the more recent results from Accuracast? While the metrics analyzed in each study were slightly different, it was interesting to note that clicks below the Top 4 have leveled out over the year to more conservative numbers, and that CTR for ads in the Top 4 have increased significantly. The data shows that users quickly adapted to the change and search marketers can rest assured that the search-pocalypse has been avoided.
All in all, this is great news for paid search marketers! It’s clear that PPC continues to be an extremely profitable investment in 2017.
Image 1: Accuracast Study