THE IMPACT OF THE REMOVAL OF RIGHT HAND SIDE ADS ON THE SERP

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WHO WE ARE

• Mission: To Help Digital Marketers Succeed Online.

• Incorporated: 2005.

• Global Offices: Princeton (HQ). London. Hyderabad.

• Team: 100+ fanatically analytical search marketers with over 5.5 MM

hours of hands-on retail search marketing experience.

ABOUT UDAYAN BOSE

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Founder & CEO, NetElixir.

Founded PartyBingo.com (Party Gaming, Plc).

Guest Lecturer:

• Johnson School of Management, Cornell University.

• City University of New York, Baruch.

• Indian School of Business.

#netelixir

http://www.linkedin.com/in/udayanbose

{ }THE RESEARCH

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04-19-2016Google confirmed that search

results pages on desktop will no

longer show text ads in the right

sidebar.

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Text ads will display above the

organic listings

Text ads will show at the

bottom of the page.

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Statistical Study on Six Performance Metrics based on Live Adwords Data

Desktop UsersJan 1st – April 15th 2016

12 Million Impressions Four Industry Verticals

{ }HYPOTHESES

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H1: CPC (Cost-per-Click) for text ads has increased.

H2: CPC for Product Listing Ads have increased.

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H3: The auction participation has come down.

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H4: Click Through Rate (CTR) for fourth position ad has increased.

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H5: The % share of traffic from PPC has remained unchanged.

H6 : The % share of traffic from Organic listings has marginally decreased.

{ }RESEARCH

FINDINGS

POLL#1

What in your opinion was the CPC inflation for text ads?

VOTE

NOW!• > 50%

• 35-50%

• 10-35%

• Less than 10%

• Down by 5%+

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CPCs for Text ads (interestingly) are marginally down while for PLA ads are up by 20%. We believe PLA CPCs will cross text ad CPCs for most categories by Q3,2016

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8 CPC - PLAs ($) CPC - Text Ads ($)

$1.5$1.3

$1

$1.2

Is there an offsetting happening ?

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As the number of text ad listing opportunities have declined, the number of participants entering the auction has decreased.

POLL#2

What was the increase in CTR for 4th position text ads?

VOTE

NOW!• >50%

• 35-50%

• 10-35%

• Less than 10%

• Down by 5%

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CTR for 4th position text ads are up, significantly.

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

CTR up by

67%

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Share of traffic from PPC (text ads + PLA ads) are up from 28% to 35%. Since organic listings have been pushed down, the traffic share there has declined.

Organic 72%

PPC28%

BEFORE CHANGE

Organic 65%

PPC35%

AFTER CHANGE

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Lower than expected increase in the CPC for text

ads

The number of advertisers participating in an auction

has come down.

Better visibility and higher click-through-rate for 4th

position ads

Share of traffic for PPC has increased.

Share of traffic from organic listings has come down.

20% Inflation in the CPC for Product Listing ads

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The new layout with a lesser real estate for text ads, has had marginal impact in terms oftraffic decline (for text ads). However there is a decline in the number of auctionparticipants as the supply of ad-real-estate has come down. This signals the withdrawal ofadvertisers at the lowest end of the spectrum (who would be mostly mid-market andsmaller businesses).

NetElixir RecommendsFocus on the “Value of the SERP” rather than from individual ads/listings.How much are you investing on the page and what’s the return (all ad formats combined). Download our Jan 2015 webinar recording on “Supercharge your SERP”http://www.netelixir.com/universitys/workshops-webinars

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Product Listing Ads continue to become increasingly important. The advertisers need to be more careful with the spend on PLAs. They have much lesser

control (than text ads) on when and where their listing shows up.

NetElixir RecommendsApply NetElixir’s Pyramid Model for PLA Optimization.Download our March 2015 webinar recording on “Maximize your PLA profits”http://www.netelixir.com/universitys/workshops-webinars

DOWNLOAD WHITEPAPER

http://www.netelixir.com/rhs-casestudy

QUESTIONS PLEASE

Udayan Bose. Udayan@netelixir.com

Kaitlin Knauss. Kaitlin.Knauss@netelixir.com

Join the conversation: @NetElixir.

NetElixir Inc. + 3 Independence Way Suite 203 + Princeton, NJ + 08540

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