Google has been testing ad layouts for online searches for a long time now and just recently updated their desktop search results page in a significant way to make paid ads more prominent for end consumers.
If you own or work in an online environment selling products or services, this change will most certainly influence your organic and paid traffic, CTRs, bidding pricing, average position and so on. For this reason, it is important to understand what has happened so you can react in a timely manner.
What we can foresee is that the affected online marketers will need to invest a bit more time on rethinking their marketing strategy to keep SEO traffic up and SEA costs down.
So what has changed With Google’s Ad Layout?
The changes confirmed by Google on the Friday, February 19th, 2016, are affecting desktop search results in the following ways:
- When you search for a keyword on Google you will now see that four text ads are eligible to show instead of three ads above the organic listings. This is the case for keywords which are considered “highly commercial” (read definition below).
- If you look into the right-hand side of a Google search result you will notice that it is now being used for Product Listing Ads and Google Knowledge Panelsl for relevant queries only. This means that there are no text ads on the right-hand side anymore for desktop search results.
- If you scroll down to the bottom of a page result you will notice that three text ads will be eligible to show at the bottom of the search page result.
What are highly commercial queries?
Google considers highly commercial queries when users search with an intention to buy a product or service. Let’s take the keyword “Nike shoes” as an example. In a normal screen size 1366×768, you will notice that 4/5 of the search result page above the fold is now dedicated to paid ads and only 1/5 of the above the fold page is now dedicated to organic search results.
This change is now the case for all commercial keywords so if you are a B2B SaaS business selling analytics software online or a web shop selling watches you will be affected by these changes.
Does this mean you should only be investing time and money on paid ads? Well, it’s important to look at the expected changes in CTR in order to make a strategical decision here.
Expected changes in CTRs
A Google CTR study shows that 56.8% of users click on first-page organic results with one top ad displayed, 41.5% clicks with two Top Ads displayed and 29.1% when three top ads appear. With four ads display, we can expect between 15-20% clicks in organic search. This is definitely something to have in mind when planning your new marketing strategy.
How does the Google update impact your online marketing activities?
At this point, it’s wise to rethink your online marketing strategy when competing for highly commercial queries. For all online marketing managers, you may want to start or restart campaigns bidding for highly transactional keywords because the chances that a user will click on your organic landing pages has significantly decreased.
For SEO managers, keep this change in mind as it might have a negative influence on your SEO-traffic numbers. In order to meet organic traffic and lead targets, you might need to significantly increase your SEO efforts.
For Paid Search advertisers be aware that this change will most likely drive up average CPCs as the competition for ranking increases. All companies with small paid ads budgets will find it increasingly difficult to rank for those high competition keywords, as it is expected that only positions 1 to 4 will matter from now on. If you already rank most of the time on position 1, your average CPC will not be influenced that much.
If you rank position 3 to 4 then you will have a more negative impact as most competitors who also show around those positions will most likely raise their bids. The result is that either you will then lose your traffic by ranking for the ads on the bottom of the page or have to raise bids to increase your ranking position.
All arbitrage websites, aka sponsored content sites that bid around €0.04 just to show up on the right-hand side of the search result, will most likely struggle as their minimum bids for positions around 4 to 6 will not bring enough traffic anymore once most of the ads will be shown on the bottom of the page.
Where you affected by the changes? We would love to hear from you on the comments below.