Watch Out – AdWords New Feature View-through Conversion

Few days ago Google announced about a new AdWords feature – View-through conversion reporting. It’s allowing advertisers to check the efficiency of their display ads in terms of impressions rather than click through. Even if the user did not click on the ad, Google still allow the advertiser to measure its effectiveness based on the advertiser goals.

Today I would like to share with you my thoughts about this Google move. How affiliates marketers might get affected.

The display ads market is been controlled by several players like double-click (now own by Google), right media and others while the biggest Google competitor on that market is Yahoo.

The display ads market worth lots of money. The biggest companies in the world, big names like Amex, Coca-Cola, and GE are spending huge amount of money every month.

The PPC affiliate business model is based on arbitrage. We buy traffic, hopefully cheaper than what we get in return, whether it’s a CPA offer or revenue share.

When Coca-Cola advertises on the web they would like to keep the awareness for their brand. A brand campaign is different than a typical affiliate campaign. The goals are different and are been measured differently. Brands campaigns are known with their high budgets. And where the big money is, Google would like to be!

So after Google acquire double-click their next step was to integrate double-click inventory within their Google content network. Now Google enhancing their tracking system to meet the big firms brands campaigns. With the new feature that was lately released we can learn something about Google future intention, at least for the display ads market.

There is no doubt that this change will affect the affiliate industry:
1. More competition on every spot – in these case rich competitors
2. Brands campaigns, especially with the big names, includes huge budgets. This will increase the effective CPC (usually brands campaigns are been calculated by CPM).

If so far we got used to compete with performance based competitors, who are looking for a positive ROI, now we have to deal with a different players playing by a different rules.

I believe that this is only the start of a bigger move after the top advertisers on the web. The affiliate marketing industry is a major part of Google income but it’s also one of their top biggest headaches, caused by affiliates who use Google AdWords to promote gray products. At the ends of day Google is the one who need to deal with their users complains, maintaining support teams etc.

Google probably prefer to sale their inventory to the less choosy– Brands campiness. It’s not that Google have something against affiliate marketer, it’s just easier to work with big accounts rather with those who spend $100,000 per month (no it’s not a typo, Google will prefer account of $5,000,000 a month). As Google will fill those spots with Brand campaigns, more and more affiliate accounts will be banned and/or more restrictions will be added to AdWords policy. Either way, it’s not going to be easy for affiliate marketers, at least not at the Display Ads market.

I believe that during 2010 we are about to experience some major changes with the way Google treat affiliate marketers. In my opinion those who will play by Google (changing) rules will survive (Especially those who spend lots of money each month).

Affiliate marketers have ever been and will always be the smatters among the online advertising businesses. It’s something that no one will be able to take away from us. So keep your mind open and be ready to hear more from Google. I’m sure it will come soon.

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Comment by Snir
2009-10-03 13:20:00

Nice read. A different angle on google’s change of heart toward AM. It all makes a lot of sense.

Comment by Doria Koprowski
2010-04-29 12:33:22

Adwords is really good in driving traffic to your website. however, they are very strict right now and they would not easily approve websites that they thought have low quality content. :

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