4 MINUTE READ | February 23, 2016
What to Expect From Google's Right Rail Ad Update
After many months of testing removal of right rail ads in the SERPs, news broke via Search Engine Land on Friday afternoon that Google will be removing all right rail ads in the SERPs globally. Although this was a sudden surprise, our account teams at PMG had begun seeing many instances of the Google SERPs beginning to show this change in 2015 and into 2016.
Below is a summary of what is changing:
Desktop right rail ads are going away globally tomorrow (Wednesday).
This reduces the amount of available ad space from 11 to 7 for all SERPs (37% decrease in ad real estate).
This means the desktop experience will now match tablets & mobile.
Google will now serve a max of 4 ads at the top of the SERPs and 3 ads at the bottom.
The 4th top ad will only show for highly competitive keywords.
PLA’s and knowledge panels will remain unchanged and continue to show on the right rail.
Google doesn’t expect any impact on organic visits (we doubt this).
This global change is particularly interesting as we continue to see Google work towards increasing ad visibility while making organic listings less relevant. We began seeing this trend with Google’s mobile SERPs change in Q3 2015 where all visible ad real estate is now dedicated to ads with organic listings pushed out of the way (as seen on the right screenshot).
And, these mobile changes were really profitable for Google as stated in their Q4 2015 earnings call,
“…we did benefit from a change made in ad format in Q3 with respect to mobile search and we continue to benefit from that change…”
We believe Google is making this change in response to continual CPC declines year-over-year, as in their Q4 2015 earnings call they noted that,
“network CPC’s were down 8% year-over-year.”
By limiting the amount of ad real estate globally on desktop, they are going to be able to revive declining desktop CPC’s due to supply-and-demand. This will be especially apparent in highly competitive verticals like travel and retail.
On the plus side, this change could be great for brand keywords that have a lot of competitors bidding on them. This means that for brand keywords that have a lot of competition today, we expect conversion rates to increase and many competitors to be pushed out.
This change will also have an impact on organic listings (even though Google says they will not) as the extra ad at the top for highly competitive keywords will push down desktop organic listings even further. This is not to mention other elements that can now show like Hotel Price Ads on travel searches. The screenshot below shows a search done today where organic listings are now below the fold:
We also heard that 2-line sitelinks for paid search ads will become more frequent with this change. With 4 ads at the top and potentially each of them getting 2-line sitelinks that will obviously increase the chances of only seeing text ads above the fold for many commercial queries.
What are we going to do?
In the upcoming days we do expect our clients in highly competitive verticals like retail and travel to experience increases in desktop CPC’s. However, the extent of how much CPC’s will increase remains unknown, and your account team will keep you in the know as they see these changes occur.
For less competitive verticals we do not expect to see much change in desktop CPC’s unless the competitive landscape begins to change for that vertical.
We also expect to see organic listings on desktop to take a hit on highly competitive verticals even though Google says it will not. This is in result to the additional 4th ad that can appear on the top, and 2-line sitelinks that we expect to be more frequent now.
In conclusion, even with this change in desktop, this is not our first rodeo with SERP changes!
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Rest assured that your account team is ready to react to whatever changes we may see and we will be diligent to make sure that these changes are communicated to you in a timely manner.
Posted by: George Andrade
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