What Is Going On With AdSense Earnings?

Sunday, October 28th, 2007 at 2:42 pm | 429 views | trackback url
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“The trouble is that AdSense is a chaotic and complicated system, and we are all trying to make sense of it with a lot of missing information.”

Keep that quote in mind if you’re an AdSense publisher.

AdSense is a complicated system. It is also a black box. What we see through our AdSense reports, is exactly what we’re allowed to see. There’s a lot of complexity behind the system that Google does not want you to see. This is precisely why it is a violation of the AdSense TOS, to share your specific earnings amounts, percentages and such… because collecting that information over time, would allow someone to discover their weighting, their algorithms and their methods.

That being said, everyone has been complaining that their impressions, CTR and eCPM is climbing, but their EPC (Earnings Per Click) is dropping in dramatic numbers. My own experience shows a 75% drop in EPC, but my traffic has doubled.

  • It could be that Google is decreasing the value of clicks across the board, which would have the effect of making click-fraud less attractive for arbitrage sites/MFA sites and easier to catch with less losses to the advertisers who pay for every click incurred.
  • It could also be that Google’s ads aren’t being as well-targeted, so users aren’t clicking them.
  • It could be that Google is testing new algorithms, and sometimes they get it wrong.

I’ve been maturing a lot of sites I host, and have been aggressively adding SEO to them. Most of these sites are PR6 and higher with thousands of “organic backlinks” (i.e. not “purchased” traffic). Yet, even though these sites show up in the top 10 and top 5 for their keyword niche, and even though their overall traffic has nearly doubled in the last 2 months, the EPC has dropped by 60-75% across all of them.

Organic backlinks are best defined as:

An important factor in a backlink strategy is to ensure that they are increasing in number continuously, from a range of IP addresses and properties owned and maintained by a diverse collection of webmasters around the world.

This natural growth is difficult to fake and any engine’s bots finding a host of poor quality links to your site one day when none existed the previous, and then very few, if any, emerging over the coming months is a giveaway sign that you have been trying to bait them with an aggressive and ill thought out backlink strategy.

Just as the site itself should grow over time, so should the number of routes back to it.

At this point, I can’t even justify keeping the sites running, if they don’t pay for themselves anymore. Earning $1.00/day for a daily 2,000+ uniques and a 1.00% CTR, is just ridiculous. I’m going to have to start charging the site owners a fee to keep the sites running now, which I haven’t had to do in 7 years.

Someone is making money with AdSense because there are hundreds of reports of people making $2k+/month or more on new websites, with hardly any backlinks or visitor, in some very narrow, very low-traffic niches (like “Switching Power Supplies”).

I don’t know what I’m doing wrong, or what Google is penalizing us for, but it seems that people who get to PR6 and higher, are being slapped… and not just the blog farms.

I’m not sure what my next move is, but a lot of people are jumping off of the AdSense ship to servces like LinkXL, AdBrite, TextLinkBrokers, VibrantMedia and others.

I tried signing up for the Yahoo Publisher’s Network (YPN), but apparently that’s now a closed beta, and they’re not accepting anyone new.. or if they are accepting new publishers, they’re only accepting VERY low impression sites, not PR6+ sites.
I emailed Google about the sharp drop in earnings, and here is what they had to say on the matter:

I understand that you’re concerned about a decline in your earnings-per-click, and I know that this can be frustrating.

It’s not uncommon for earnings to fluctuate significantly over time. Since a number of factors influence earnings-per-click it’s difficult for me to pinpoint the reason.

As you may know, we constantly analyze the data in our network against several factors. If our data shows that a click likely will not lead to a conversion for the advertiser (for example online sales, registering, a phone call, signup for a newsletter etc.), we’ll reduce the price the advertiser pays for this click. This automatic system is constantly changing and is also impacted by the ad auction.

AdSense is unique because it’s designed to maximize eCPM for our publishers, taking into account both the advertiser’s cost-per-click (CPC) bid and the likelihood that the ad will be clicked. Some ads are attractive to a broad range of site visitors and will be clicked on more frequently. While this can be great for your CTR, advertisers are often bidding less for these kinds of broadly targeted ads. Other ads are attractive only to a small niche of users. Advertisers will typically pay more for these tightly targeted ads, but those ads are also less likely to get clicked.

Depending on ad inventory, you may see some days on which AdSense will show a lot of high CTR/low CPC variety ads. On other days, you may see the reverse. If you see this correlation in your own AdSense reports, keep in mind that we’re always working hard to maximize revenue for our publishers. One aspect of that is being able to best take advantage of the earnings characteristics of different kinds of ads.

Basically a canned response. They don’t seem to care about the publishers, only the Advertisers.

I’m still shopping for a replacement.

Last Modified: Sunday, October 28th, 2007 @ 14:42

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