May 1st, 2009 | Published in Google Adwords
Last week, we released a study on performance trends on Google's Content Network. The study compared the cost per acquisition (CPA) on Google's Content and Search Networks and found that, for the median advertiser, the average CPAs were about the same on both channels. Since the release of the white paper, we've received some questions from our advertisers about why CPAs were similar and what actions you should take based on the findings in the white paper. We are addressing these questions in this post, and to better reflect the insights from the detailed analysis, we've made some clarifications to the executive summary and concluding paragraph of the white paper.
As the white paper indicates, the primary reason for similar cost-per-acquisition on the content and search networks is a result of our smart pricing system. Smart pricing is a feature that automatically reduces the price advertisers pay for clicks if our data shows that a click from a Content Network page is less likely to result in a conversion. This means that if our smart pricing system predicts a particular Content Network page is likely to have a low conversion rate, we will automatically reduce the price advertisers pay for that click. As the white paper indicates, the conversion rate on the Content Network sample was 27.9% lower than on the Search Network but this was offset by the fact that CPCs on content are 28.4% lower than search.
In terms of what actions you should take based on the findings in the white paper, we recommend you:
- Consider complementing your search campaigns with campaigns on the Content Network, if you haven't done so already. Remember that success on the Content Network starts with good campaign structure, so please refer to our optimization tips when setting up your campaigns.
- Use the new tools we offer for content optimization such as the Conversion Optimizer, Placement Performance Reports, and the Site and Category Exclusion tool. They can help you further tailor your Content Network performance to meet your advertising goals.
Of course, it's important to recognize that performance can vary from advertiser to advertiser, both in terms of CPA as well as conversion volume.
The report describes the experiences of those advertisers who adopted tools such as the Conversion Optimizer and Placement Performance Reports and continued to use them. We think that the evidence is strong that these tools have been useful to these advertisers.
We believe that search is still the most effective advertising medium for providing a strong base of conversions. At the same time, the Content Network can be a cost-effective way to gain additional conversions beyond those you get via search.