That's certainly not unheard of.

Smart pricing may have kicked in, if your increased traffic isn't converting for the advertisers (or hasn't had a chance to increase for the advertisers) Also, if you suddenly added tons more impressions and clicks for your site, some advertiser(s) may have run placement reports, noticed the increase, and decided they didn't want to allocate that much budget to your site, specially if they weren't seeing sales from it.

Game sites are notoriously difficult to monetize with AdSense. They send lots of traffic but not so many conversions. I'd mix it up with some affiliate ads if I were you.

Thanks netmeg. I do not think I have any placement targeted ads. When I check under the "ad review centre" I do not see any placement ads. (hope my interpretation is correct :) )

Thanks again
Skimo

so smart pricing kicks in on higher impression sites? I'm a little confused too.

Thanks.

As was calmly and rationally explained to me when the same thing happened, there is no such thing as smart pricing.

Sadly, your cpc will remain the same if you remove the ads.

Yes, confusing.

One thing I have heard, and this may be a myth, is that Adsense will keep your earnings per day about the same, so even if you get more clicks (or less) they will adjust the price.

Also, maybe the page that the new ads are on is trigering lower paying ads. Maybe you should try playing around with channels.

All myths.

You don't have to have placement targeted ads. If I'm running a broad campaign on the Content Network, and suddenly my advertising costs double, I'm going to run a report to tell me where my ads are showing, how many clicks each url is providing, and where the conversions are coming from. That's a placement report; it has nothing to do with placement targeting. If I see a sudden jump in clicks from a particular site, and few or no conversions, I'm gonna block that site from displaying my ad, or move it to another campaign with a much lower CPC.

Smart pricing doesn't necessarily kick in just because the impressions are higher. Personally, as I have said many times, I believe ALL clicks are smart priced; they're evaluated by the source of traffic and likelihood of conversion, and priced accordingly (probably why it takes so long to get stats these days too, if you think about it - it takes longer to get the final value) But when your impressions are higher, and your clicks are higher, that doesn't necessarily mean that the value of your traffic rises exponentially.

The ceiling is also a myth. I have seasonal sites that make a few dollars a day off season and hundreds and hundreds in season. Why on earth would Google put a ceiling on the earnings? If we don't make money, they don't make money.

Very interesting. Here is another data point:

The same Ad will appear on inside pages and the "high volume" page. But, its CPC is lower in the high volume page.

Does google change CPC based on how "google friendly" the page the ad is on? I say this because the high paying pages are simple html with content. The gameroom/lobby (high volume page) has no real content besides meta. It is made of countless iframes dynamically generated and each iframe has a unique URL. The ads still display relevant content. (could it be looking at the domain as a whole if its unable to read the complex lobby?)

Just throwing out ideas in my mind. I really want a solution or an implementation plan. We are doing a market launch soon and expect pageviews to skyrocket. DO not want to launch yet if we are making a cent a click! :( :(

Thanks
Skimo

I believe that Adsense values based on page "trust", but I guess there is no way to prove it. Just my theory.

Another thing I am thinking is that people who are playing games are more likely to maybe click over but be more interested in playing the game and quickly return, unlike someone who is willing to buy, searching, etc. Hope this helps. I kind of feel bad for you :(

Occams Razor approach

The more ads you add, the more lower paying ads will be displayed, hence the probability of someone clicking on a low paying add increases dramatically.

I had a somewhat similar experience recently after changing ad placement -- I doubled my CTR, which initially doubled my earnings. However, CPC is now going down, and earnings are starting to settle down toward what they were before.

I don't think this is because G has set a ceiling on my earnings. I think that smartpricing is simply trying to match the actual market value of my traffic. Humans are unpredictable individually, but in large enough numbers statistical behavior is remarkably consistent. Maybe the people visiting my site simply have a fixed amount of total money that they are willing to spend, and there isn't much I or anyone else can do to increase that.

The other thing I would look at is, why are your high-volume pages getting more traffic? Are they bringing traffic in from high-volume, low-value keywords? It may be that the traffic to those high-volume pages is just worth less than your other traffic. Even if they are clicking on the same ads, you may be looking at a different set of people who are much less likely to buy.

Naturally, the lobby/games pages are very dynamic and have no text content...all content is flash driven or datagrids. Only "content" I added is in the form of Meta tags.

The other thing is, I don't know whether or not this is exactly within TOS, but even if it is, it's pretty hard for a contextual ad program to serve relevant ads if it doesn't have any text to read. The meta tags aren't going to be enough. I wouldn't put ads here myself, but if you must, you probably should see if there's a way you can add content.