Google Discontinues Right Rail Ad Delivery

March 9, 2016
Johannes Källgren, VP Insights

Should Google’s Latest Update Impact Your Search Bidding Strategy?

Google has confirmed that it is rolling out a significant change to the way its desktop search engine results pages display ads. The change does away with right rail ads, thus reducing the number of ads above the fold.

Advertisers are expecting that the auction will shift and bidding strategies will need to be adapted to these changes. For example, if your ad is in Position 4, depending on the query, you may or may not be above the organic listings. For the lower positions 5-11 (now 5-7) the CTR may decrease as they move from the right rail to the bottom of results.

It’s understandable that advertisers are wondering what changes you might need to make to your bidding strategy to adapt. However, there’s no need to overreact or panic. One article written about the change even went so far as to suggest advertisers actually turn off their automated bidding!

To be clear, if you’re using Campanja’s Advanced Bid Optimization platform, changing your bidding approach isn’t necessary.

Here’s why: Due to the intricacies and evolving nature of Google’s algorithms, Campanja’s software was deliberately architected from the ground up to respond to the dynamics of each auction. We update our models with data from Google throughout the day, and our software is able to bid up to 7 times per hour on every keyword – faster than any other bidding tool.

With more competition on top queries, the ability to change bids throughout the day allows Campanja’s software to take advantage of the more cost-efficient times of the day, with an edge over advertisers who are only reviewing bid landscapes and placing bids once a day. We also use Google’s auction landscapes for every keyword to inform our models, as Google has more data on the auction than any individual advertiser. This means that Campanja will automatically recognize any advantage that can be tapped, such as an increased CTR for positions 3-4, as well as the potentially larger volume gap between positions 4-7.

While the overall rules of the auction have changed, the positioning of ads has always been volatile, and is frequently tweaked by Google behind the scenes without advertisers’ knowledge. The three positions displayed above organic results have always varied from showing 0-3 ads depending on the keyword, even with several advertisers participating in an auction. As the new change rolls out, all auctions will now have 4 possible positions above organic results.” However, the volatile pattern will remain and the number of positions above organic results will keep varying by keyword and auction.

What this means for advertisers using Campanja’s Advanced Bid Optimization platform is that current goals can be kept, and our system will respond automatically to any changes and new opportunities in the auction. The only unknown is how other advertisers in the same auctions will react and if CPCs will go up or down due to their bids. While Campanja automatically respond to these changes, an advertiser with strict conversion or revenue goals may need to adjust their CPA or ROI to fulfill those goals, as overall, the auction landscape will not be the same moving forward.

For more information about how the changes will impact your campaigns, contact Campanja today and we’ll be happy to answer your questions.

Johannes Källgren, VP Insights
Johannes Källgren, VP Insights

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