Another huge advantage... placement-targeted text ads get stretched and enlarged to fill an entire ad unit... If a publisher has specified that a strip of four AdWords ads should appear in a banner at the bottom of a page, placement-targeted ads will muscle the other ads off the ad unit and be displayed big and bold.

It could be simply that this advertiser made an observation and assumed he knew the cause yet his causation assumption is clueless.

Kinda' like some of the threads on this board where someone eats a hamburger, has poor AdSense earnings on that day and starts a thread to tell the rest of us why we shouldn't eat hamburgers.

FarmBoy

this guy was an advertiser, rather than a publisher.
and the information that he was giving apparently came from google themselves, to the advertisers. so it came from the horse's mouth.

I've been advertising since AdWords started. I don't typically pay less for site targeting; I have to pay *more*. That ad that takes up the entire block has to compete with the *combined* total of what four or five ads would pay, in order to push them out.

I grant you that the stretched out text ads look pretty awful - myself, as an advertiser, I only use it with graphic ads.

To my mind, it's actually more a case for not putting too many ad blocks on a page.

Sometimes site targeting is good for the publisher, and sometimes it isn't. As with most things, it depends.

All too often, publishers blame their low earnings on site- (a.k.a. placement-) targeted ads when the real culprit is a lack of higher-paying CPC ads. Why? Because, according to Google, site-targeted ads are displayed only when the system calculates that such ads will pay better than CPC ads. If you're getting site-targeted CPM ads that deliver abysmal earnings, those ads aren't your problem; they're a symptom of deeper and less obvious problems, some of which may be within your control and some of which won't be. Ask yourself:

- Is my audience looking to spend money or, better yet, researching purchases?

- Is there anything about my site or audience that makes clicks unlikely to convert for advertisers? (E.g., a design that encourages clicks by users who are confused or who are merely looking for information?)

- Is it possible that too many publishers are competing for the same ads for whatever the topics of my pages might be? And in connection with that:

- Is it possible that I'm missing out on long-tail traffic and ads by focusing too narrowly on "money" topics and keywords?

- When I do get CPM ads, are they relevant to my topic, or are they generic ads?

Some things, such as the state of the economy or the number of publishers in your category, are beyond your control. But other things, such as the topics of your pages and the quality of your clickthrough traffic, are completely or at least partly within your control. Find a way to make CPC ads work better on your site--not just for you, but for advertisers--and you may not have to worry about a flood of low-paying, off-topic CPM filler ads.

all of that is true, but there are some other little things as well.

if you have a four block that pays a combined total of $2 (for example), and they are pushed out by 1 solitary ad that pays $2.01, then the chances are that you've lost a click, because bigger blocks containing 1 text ad don't look too good.

obviously on some sites they do look good, so there isn't a problem, but some sites might lose out.

and also, people might have been inclined to click the 2nd, 3rd or 4th ad whereas with one ad they didn't get that option. Even if they happen to be paying a bit less than the 1 ad, that's still money for you rather than nothing.

also... i sometimes see 3 and 4 ad blocks underfilled with 2 or 3 ads. which also messes up your design and font-sizes. so i'm wondering if 1 site targetted ad can just kick out a portion of the ads.

Keep in mind that Google will take the click through rate into account when calculating which ad will pay the most.

As an advertiser, some of our site-targeted banners get a CTR that is ten times higher than our general text ads or even more, so our site-targeted ads will do quite okay for the site owner even if the per-click looks lower.

I grant you that the stretched out text ads look pretty awful

Exactly my opinion. ASA, if you are reading this, I hope you'll note this feedback.

[edited by: true_INFP at 7:51 pm (utc) on Feb. 3, 2009]

I just researched my stats.

The eCPM of placement ads is in general much lower,
but compared to all my experiments with alternate to PSA had been far far lower.

I think there is a gradient scale

context - placement - PSA

So I think the placement ad is the best possibility in this case

Before we stopped site targeted ads, the eCPM from these ads was between 20% and 40% of contextual ads for a while. This has not always been the case. There was a period in 2006 and 2007 where the eCPM of sitetargeted ads was always better than contextual, on average twice the eCPM (albeit on a very low volume compared to contextual ads).

The eCPM change happened in January 2008, abruptly, without significant drop in ad traffic (so we think just the payout or minimum bids have changed back then).

Opting out did not affect us much. It did take off the burden to micro-manage the ad quality. You'd be astonished to see what ads run in this program...

Also keep in mind, once again, that what is in Adsense's best interest in not always what is in any INDIVIDUAL publisher's best interest. You need to look at it ALL from THEIR point of view not the publisher's. Many a publisher would rather keep a visitor on his own website browsing more, rather than send them away to another site for .01. Whereas to Adsense a penny click is a penny earned, and it COULD even take the visitor to another Adsense displaying website where the visitor could click yet again, for .01 or MORE! In fact it would surprise me greatly if G did NOT take into account the fact that a destination adwords website is ALSO an adsense publisher with an additional income producing click potential when they decide what ads to display over others. i.e. from Adsense's point of view it COULD be worth displaying an ad for an adsense publisher at a price of a penny or two less to YOU than another advertiser, if ultimately it means they could earn an additional 5 cents more when the visitor goes to the next publisher site and on the average clicks twice again. Good for G and THEM, not so good for YOU. They don't care WHERE the click takes someone or comes from as long as they click on an adsense ad. The rest is simply a matter of mathematically optimizing best price multiplied by most clicks taking into account all future statistical possibilities. This is why you will NEVER, EVER see a "minimum acceptable bid per click" option for publishers.

This is why you will NEVER, EVER see a "minimum acceptable bid per click" option for publishers.

That's one reason. Another is that most publishers have a grossly inflated opinion of what their traffic is worth. The PubMatic Q4 AdPrice Index [pubmatic.com] has some eye-opening numbers. (Among other things, it states that average CPMs for "small, medium, and large sites dropped 52%, 23%, and 54%, respectively" from Q4 2007 to Q4 2008.)

Another is that most publishers have a grossly inflated opinion of what their traffic is worth.

It should still be their choice to display PSA ads, alternative ads or nothing at all instead of 3 cents / click low ballers. Ideally. If Adsense had some competition, that is.

By running reports that show the CTR (define) and conversion rate data for each site, you can fine tune each site's maximum CPC to achieve acceptable ROI for each site.

Their ads will not bump out the bidders that are paying more per click per impression. It only means they are finding where your bottom to middle bidders are and bidding enough to compete with them. The less they bid, the less their ad is shown. At a certain point you reach an equilibrium where you are showing just enough ads to justify the spend while outbidding the CPC bidders. That is all that means. It does not mean you can lowball AND block ads that pay more.

Instead of dominating higher paying ads, as when the program first started, they are paying for enough impressions to squeeze a profit and if others are paying more then their ads do not show. I know this from my experience as an advertiser. Try it yourself before concluding advertisers can lowball higher paying advertisers.

I'm a hardcore skeptic that has to see it and measure it before I make up my mind. I opted out of site targeting when it first came out and didn't go back for years because my initial experience was jaw droppingly bad. I am on the record in this forum stating that CPM site targeting sucked. I have NEVER hesitated to criticize Google when I have found fault, a real fault that can be measured. I am on the record in this forum [webmasterworld.com] as stating I opted out because it was measurably bad. When anyone posted asking how to opt out I am on the record here explaining how to opt out. I quote my reservations at the end of this post.

But I gave it another chance because I thought maybe enough time has gone by and Google has worked out the initial kinks. My experience after having opted back in is that Google has fixed whatever shortcomings existed in the beginning. This was confirmed by my experience as an advertiser where I had to bid relatively high CPM to get decent placement on the sites I wanted to target. It was either bid high or go low and scrape up remnant traffic after midnight and before sunrise, when anyone with a credit card is sound asleep.

Con
I had a bad experience with site targeting when it first came out and had my sites pulled out of the system. Perhaps their algo is better now, but when it first came out I can attest it wasn't a good fit for that particular site. I remember checking my earnings and being upset because they had dropped significantly. When I checked my site I saw a single ad plastered on every page- regardless of context. My site has hundreds of topics within a niche, the vast majority not relevant at all to that lone advertiser. It was unquestionably not a good fit for that site at that time.
I suppose they're better nowadays at matching context and making sure it doesn't lose money for publishers, but it'll be awhile before I go back into the waters, mainly because of the quibble I list below.

Pro
I've used it successfully as an advertiser spending a little under a hundred dollars per day on one site, but obtaining a ton of clicks that averaged to half a cent per click. That site operator may have been earning an extra hundred dollars per day they might not have otherwise made.

A quibble
The concern I have with the CPM program is that instead of showing "advertise on example.com" they display, "advertise with Your Legal Business Name" which although it may or may not be in the whois, I find it awkward in that particular context.

While I am currently inclined to give the site targeting program another chance, I'm holding back because I don't like the way they show my legal business name.

I just want to add that the types of ads that were showing on that particular site, I am certain they weren't getting much click through. I had to bid high to get my ads to show and nearly a hundred dollars per day, burned by that afternoon Pacific Standard Time, must have been good for the publisher. My subsequent experience bidding on authoritative sites confirms that the ad inventory is not being given away.