Everything Hinges Around This One Spot
It should come as no surprise to anyone that positions one, two, and three are the most important ad positions on any page. They are above the organic results, they are the first to be seen, and they get to show ad extensions. Naturally, Google AdWords gets the highest percentage of clicks from the top spot on the page. The highest advertiser is the one that has the highest Ad Rank, which is largely dictated by bidding. Advertiser number two is largely responsible for how much advertiser number is going to pay based on the Ad Rank formula.
While most of the clicks on desktops go toward positions one through three, there are frequently between two and four advertisers that are bidding sufficiently for those positions. If position number four doesn’t have a decent bid, then the third advertiser is going to pay very cheaply for their clicks. Naturally, the same thing happens to the second advertiser on the page if the third advertiser isn’t bidding competitively.
Now then, imagine all those ads on the right hand side. How many of them have the budgets to stay up all day long? My guess is most of them don’t have the allotted budgets to do so, so maybe one or two. This further exacerbates Google’s problem to keep their average cost-per-click sufficiently high. They need more advertisers to create a competitive field and push the top advertisers higher.
The Mobile Monster
If desktops weren’t enough to worry about, smarthphones throw in a whole range of new issues. One of the biggest challenges of mobile is the limited amount of space, including in the SERPS. Most phones only display up to two ads at the top of the results, with several at the bottom. AdWords has reported in the past that only 10% of the smartphones ad clicks go to the bottom ads. So, if you’re not at the top, you’re an also-ran.
Why Is The Second Spot So Important?
Enhanced Campaigns changed a lot of the way advertisers optimized their campaigns. Much has been talked about in the past about the headaches it has caused. The biggest change this has done is to tether the mobile bids to the desktop bids. Which means the advertiser needs to make sure that their mobile is at least in spot two, which, not-so-coincidentally, often makes them fight for position two on the desktop. Google’s recent declaration that they may or may not show your Description Line 2 on mobile ads, may be leading to more situations where three ads are displayed. That’s a strong likelihood when mobile becomes the greater percentage of search clicks. Note that a great many campaigns are not utilizing the mobile bid modifier option. Many campaigns that are using them are only increasing mobile bids or simply bidding out of mobile altogether.
Beyond simple bidding for mobile becomes another problem. The great lie of the ad position creates the situation where many ads that average worse than position two, even on desktop, may in fact be on the sidebar in many queries. Needless to say, the sidebar doesn’t net a high percentage of the clicks. The Ad Position metric is a thick pea soup of clarity, which segmentation and rigid account structure are the only cures.
This blog wasn’t really about a resolution to anything; just a highlight about the bidding architecture on many a SERP. The best thing you can do as an advertiser is to monitor your bids by device with segments, and make sure you’re bidding toward your own profitability.
Now, go make some money!