Adwords Price Changes
The popular program, AdWords, by Google is seeing changes in it's prices. Starting with their pricing plans for contextual ads, Google is attempting to standardize the per-click fee, using the value received to the advertiser. Paid search listings are next in line to receive a makeover. This past January, Google's primary opponent, Overture, chose to give advertisers the option to bid separately for both search and contextual ads. Prior to that, both Google, and Overture allowed advertisers the choice of opt-in/opt-out from contextual ads, but still did not allow separate bidding.
These changes will only lower, never increase, advertiser costs. While relevance, and bid price are still the benchmark for ranking, advertisers will pay even less for certain clicks than others. This new pricing guide is known as "smart pricing". While Google refuses to reveal the inner workings of their new program, they will state that a variety of items are reviewed. Some of the items utilized for the considerations include sites the ads appear on, as well as the particular page of a site an ad appears on. Overall, "smart pricing" works by giving every individual click a value based on a number of unique markers.
As opposed to letting advertisers adjust bid costs using site, types of sites, and the like, Google had opted to retain that in their control, leaving them with the ultimate choice. While the decision seems drastic, it shows Google's stamina and drive in bringing new and varied programs, as well as it's intent on simplifying matters for advertisers. A Google spokesperson had this to say about the changes, "We may well work out that a click on an advertisement for a fishing rod on a website about fishing tips has less value than a click on the same advertisement appearing next to a review of a fishing rod." Another source explained that on occasion, advertisers had requested separate bidding and CPC's, as well as not advertising on certain sites. Google's overall goal is to make it to where advertisers simply bid, without the accompanying choices, and issues.
Kevin Lee, CEO of search marketing firm Did-It.com, stated, "I prefer to have a situation that puts the marketer and their agency in control of the price they are willing to pay as it results in better efficiencies than a closed system." Despite consumer misgivings, such as Lee's, Google maintains they are acting to obtain the best available for advertisers.
Search engines are rapidly cultivating programs, using newer and different distribution vehicles and variety in styles available. Both a curse and a boon to advertisers is that in having varied distribution methods, they also provide results just as different. Not surprisingly, many are anxious to appear on certain sites, and quite willing to shoulder the increased cost for the premium exposure.
With the knowledge that different delivery methods return different results to advertisers, the surge in activity is expected. Google recently began using their Gmail to test email ads which are selected by the relevancy of the email. This is just one of the multitude of recent possible advertising methods being seen. Aside from Gmail, Google Groups, Google News, Froogle, Blogger are some of the delivery methods employed by Google to obtain advertisement exposure.
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