AdWords “Shake Up”

By February 29, 2016Industry Updates

As a Google search user or even as an Adwords advertiser, you may have noticed a few recent changes in how Google’s search results are displayed, or you may have even heard about the Google AdWords ‘Shake up’ that was rolled out on the 23rd February. In either case, fret not! We’ve prepared a simple guide to the changes that you need to be aware of and outlined the winning strategies to exploit the new opportunities created by the shift.

The Change

The fundamental changes contained within this pretty major Google update is in the way Adwords ads and organic search results are displayed on Google’s Search Engine Results Pages (SERPs).

These changes include:

  • Up to 4 x ads can now be displayed at the top of a SERP for what Google have termed ‘Highly Commercial Queries’ (formerly their was a maximum of 3 ads).
  • Up to 3 x ads can now be displayed at bottom of a SERP.
  • The right-hand rail column of ads has now been removed completely (yep, totally gone!).
  • The changes effectively reduce the total maximum number of ads per SERP, from to 11 to a max of 7;
  • Product listing ad blocks and Knowledge Panels may be displayed is the top right rail for relevant queries.

A ‘Highly Commercial’ Search Query showing 4 x ads at the top of the Google SERP

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Unlike many previously seen, major Google updates that were clearly signalled to the search engine marketing and search engine optimisation communities, the Adwords ‘Shake Up’ as it has been dubbed, came with almost no warning and has created quite a stir and much speculation.

While Google has pointed to the need for greater standardisation of advertising formats across devices, improved end-user experience and cross-platform compatibility, the change is being seen by most as being purely commercial in intent and a means for Google to further increase it’s revenue from the Adwords platform.

The Key Drivers of Change

Currently Google derives 90% of their revenue through advertising programmes. The introduction of the new and prominently positioned, 4th top ad will more than off-set the revenue lost though the removal of the right-hand ad block. The now defunct right-hand ad block received significantly lower click thru rates (below 1%) compared with the top-positioned ads, which have traditionally yielded around 4% CTR% on average. The ad revenue created from the addition of the 4th result will inherently increase in parallel to demand and will see increased bidding pressure on advertisers, looking to secure high volumes of paid clicks from the Adwords programme.

Implications for SEO and Organic Traffic

The changes also have some very important implications for organic traffic and search engine optimisation. Two things are pretty clear at this point, fewer ads (following the removal of the right-hand rail) means greater potential for organic clicks (especially for queries that aren’t deemed by Google to be ‘highly commercial’), so the importance and the opportunity to drive more traffic from SEO strategies has increased.

Secondly, the introduction of the 4th top ad will, in the case of ‘highly commercial’ queries, reduce the amount of ‘above-the-fold’ real estate for organic search results, further driving up the value of achieving the very top organic positions. As will be the case with ‘highly commercial’ queries, where 4 top ads will be displayed (such as those for hotels lists in popular destinations) we’ll see Google Adwords ads taking a greater share of ‘above-the-fold’ real estate and pushing lower placed, organic searches below-the-fold for a large range of devices.

The Winning Strategies

The changes heralded by the update have changed some aspects of how to drive maximum performance from your campaigns and have pushed some aspects of effective campaign management and optimisation much further up the agenda. Here are just a few of the key strategies and considerations:

  1. Focus on Quality
    The net result of the change is increased competition for quality Adwords positions and the best response to this is to focus on your Adwords quality. More than ever, a well-developed Adwords strategy and an actively managed Adwords account with carefully, selected and well-optimised landing pages are paramount.
  2. Adapt Your Bidding & Targeting Strategy
    The changes will undoubtedly result in increased cost-competition as large advertisers and brands ‘slug it out’ for the top positions and adjust their bidding strategies accordingly. The increased price competition will naturally cascade down and it is recommended that advertisers re-evaluate their budgets, targeting options and bid strategies inline with their objectives.
  3. Optimise on All Google Properties & Knowledge Panel Opportunities
    The Knowledge Panel, which is presented in the top right-hand side on the Google SERP’s is a great piece of real-estate to target to get your top line business and brand imagery displayed to users for relevant searches. Make sure you are making the most of this opportunity and that your listings are fully content populated and optimised across all Google properties including Google My Business, Maps, Google+ etc.
  4. Get Very Serious with your SEO
    The AdWords ‘shake up’ is in-line with, and promotes SEO and aims to increase SERP relevancy in terms of both organic and commercial results.   A continued and intense focus on SEO will bring big rewards for the top positioned brands. While success in this area is never achieved overnight, the difference between the SEO ‘haves’ and ‘have nots’ is continuing to grow and a dedicated and continent approach to SEO will bear fruit in the medium and long-term.
  5. Target Niche & Longer-Tail Search Queries
    If you are a smaller business with weaker conversion rates or weaker margins than your competitors, going ‘toe-to-toe’ in crowded and bullish search category isn’t a good long-term strategy. A good starting point if you have found yourself in this position would be to analyse your historic data and work out in which niches you can effectively compete and focus more on those. Additionally, focusing on longer-tail queries may give you an edge and steer you out of the ‘path of greatest resistance’ enabling you to compete, but a lower volumes of traffic.

Shaken, Not Stirred?

Overall, the Google AdWords ‘Shake Up’ would seem to have some merit in terms of moving the Adwords platform towards greater level of cross-platform standardisation, which is good for both end-users and advertisers. The change would overtly appear to have been designed to improve Google’s ad revenue and has taken Adwords one step closer to being a ‘winner takes all’ advertising proposition, where weaker advertisers and being pushed out.

While the Adwords Shake Up has created some new challenges and issues for many advertisers, it has brought with it a range of exciting new opportunities and some new imperatives for brands and advertisers that want to effectively complete.

If you’d like to discuss your Adwords strategy and explore how we can help you get more out of the Adwords programme, contact us to arrange an Adwords campaign audit or consultation.

Author Ronan

Ronan Nichol is the Senior Strategist & Managing Director of Storm IMC Ltd, New Zealand. Originally from Belfast, Northern Ireland, Ronan calls Auckland his home since 2005.

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