- Posted on 1 March 2016
Google Ad Layout Update
What the changes mean for businesses
What exactly happened?
On Friday 19th February, Google announced that it will no longer show sponsored adverts on the right-hand side of a desktop search results page. Instead, the page will display a maximum of four adverts at the top of the search engine result page (SERP), above the natural listing, as well as three adverts at the bottom of the page.
A Google spokesperson has confirmed that the change will be put into effect immediately in all languages worldwide.
As a result, adverts will not appear on the right-hand- side of desktop search results, with two exceptions:
- Product Listing Ad (PLA) boxes, which show either above or to the right of search results
- Ads in the Knowledge Panel
The elimination of right-hand-side adverts will impact all desktop searches worldwide; the addition of the fourth advert above the search results will be for “highly commercial queries”, for example if the consumer was searching for a hotel or car insurance. The changes mean that Google now has a similar desktop User Experience to that of a mobile device where you can only see the adverts at the top or bottom of any search results page, meaning the User Experience is consistent across both channels.
Important changes to note:
- The changes to the Google search results page will be effective immediately
- Adverts will now only appear at the top and/or bottom of the results page. This will be split so that there are a maximum 4 adverts at the top of the page and a maximum of 3 at the bottom
- Organic results will be pushed further down the SERPs
What is the impact for advertisers?
- The change in SERPs will instigate a new ‘click behavioural’ pattern from the consumer that will need to be evaluated and addressed accordingly
A position 4 regarding “highly sales-driven keywords” can show a better CTR in the future. Ad texts with a position >4 will show significantly lower CTR, because from now on they will be displayed below the fold
- Google Shopping results might possibly obtain a higher CTR
- Increased competition at top positions can lead to higher CPCs on desktop device
- Advertisers targeting positions > 7 on generic keywords will see a drop in impressions
- Increased competition for top positions can lead to higher cost-per-clicks (CPCs) on desktop devices, lowering the cost effectiveness of this channel
- Any advertisers targeting a position higher than 7 on generic keywords will see a drop in impressions
- Advertisers with ads in in position 5-7 (bottom of the page) could suffer from lower CTR, the same number of impressions, lower quality scores and therefore higher CPCs
- Brands with a high level of competition for their own brand terms might be forced to be more aggressive in protecting their brand space as a result of organic listings being pushed further down the rankings
- Retailers will need to pay particular attention to their product feeds to ensure that they can make the most of the Google Shopping ads still appearing on the right hand side of the SERP
- Businesses could see a potential loss of traffic from organic searches as a consequence of these natural listings being pushed down. Ranking will become less and less ‘the key factor’ to consider when evaluating SEO performance, so marketers will need to put more emphasis on looking beyond that metric alone.
- At NetBooster we have seen a drop in impressions in the UK, French and German markets
- Our data shows CTR is generally stronger, with the exception of our French campaigns. This is no surprise considering the positions with the lowest CTR, i.e. 8-11, are not available anymore
- We are also seeing slight increases in CPC, but no dramatic change here
What should marketers focus on going forward?
Back in 2013, the launch of Google’s Enhanced Campaigns forced businesses to re-evaluate their entire approach to paid search, from account structure to bid management and device strategy. In 2016, Google is now forcing businesses not only to re-evaluate their search strategy once again, but also re-examine their entire approach to digital. With the number of ads visible going from 10-11 down to 4, businesses will need to carefully evaluate their bid management strategy and see if it is commercially worth appearing in top positions and how other activities (i.e. remarketing, outreach, conversion rate optimisation and so on) can help brands to maximise their advertising spend with a healthier Conversion Rate and more cost effective traffic.
Being smarter at engaging with consumers has never played such a key role in digital advertising. As such, marketers will need to bear some fundamental lessons in mind:
- Simply increasing the bids in order to maintain the same level of impressions and clicks will not deliver the desired result. You need to re-evaluate the way you think about digital and broaden your field of action in order to bring traffic in at more cost efficient levels and convert at a higher rate
- Paid search is not the only effective channel to bring in relevant traffic and performance. Companies should diversify what they do and put new emphasis on activities that might have been underestimated to date, such as conversion rate optimisation (CRO), outreach, remarketing
- Now that the mobile and desktop SERPs are similar, learning from desktop devices’ click behavioural patterns can help you to further optimise your mobile marketing strategy and approach. Mobile traffic and transactions keep increasing, so this area can no longer be ignored, even if does not generate direct conversions
- Make a bigger effort to move from traditional ‘silo’ thinking to proper cross-channel strategy. Consumers shop to find a solution to their problems. They do not mind whether they find it on Paid Search, through a Social Ad, or a remarketing ad; they just want to find it
- On average, websites tend to convert at a 2%-4% rate, which means that 98% to 96% of users leave the site without buying anything. Why should you bring these users back to the site through search when you could do it via remarketing at a fraction of the Paid Search cost? It’s a better idea to start remarketing and make sure your approach is as personalised as possible
What will NetBooster do next?
At NetBooster, we will analyse the effect of these changes on CTRs and CPCs over the coming months and produce a follow-up article with comprehensive results and a summary of how advertisers can best approach the new rules. These results will also showcase how well adverts in the new format are performing.
If you wish to discuss how these changes will affect your digital marketing strategy, please get in touch.