Google's search overhaul: what does it mean for advertisers?

Freeing up the search engine's right hand side column brings some nice long term benefits, says the head of product strategy at iProspect UK.

Google has made a big change to how search results are displayed, removing all ads from the right hand side column and adding one more to the maximum number of ads that can show above search results, bringing the total ads "above the fold" to four.

The move is the company’s largest overhaul that is noticeable to the consumer facing experience since 2008. But why has Google made this move and what does it mean for advertisers and brands?

Google constantly tests different versions of its search results page. Estimates put the total number of experiments at more than 100 running concurrently at any one time. Around two years ago a test was spotted on desktops that removed the ads from the right hand side and put a fourth ad on top.

Not long afterwards Google was seen to make a full time change to mobile results to add a third ad above the search results. It was only a matter of time before this desktop test became reality.

Over the last week Google appears to have decided this test has been successful, because the world is seeing the new layout (four ads on top, none at the side) with increasing frequency. At the moment the addition of a fourth ad is only appearing for searches that are very ad-heavy and which showed all three ads.

IProspect’s research shows that ads above the search results get clicked on average 14 times as often as the same ads positioned on the right hand side. For advertisers with the budget to afford it, this means the key metric to improve paid search traffic is how often their ads are served on the top.

By adding a fourth slot this is opened up to more advertisers than before. Anybody who has typically been somewhere in the middle of the pack with its paid search can expect to find that they now feature in traffic-attracting positions more often.

While the total number of ads being served has reduced, the ad slots that have been removed were the ones that didn't perform well for advertisers before the change anyway.

The change also bodes well for Google. Although the company might not see any immediate changes in its performance, it makes sense that this would arrest a long running stagnation (and even slight decline) in revenues from desktop devices.

Desktop costs per click have been rising very slowly, but traffic levels have been decreasing at an ever faster rate. By decreasing the total number of ads and increasing the importance of the top positions, competition amongst advertisers is likely to surge, potentially pushing up costs per click.

This is important until Google can solve their cost per click problem on mobile devices, from where the majority of traffic now comes.

While the move spells good news for some advertisers, organisations that made primary use of organic search traffic from Google might find that traffic harder to come by now. Although the increase in cost per clicks will make organic traffic more important than ever before, the decreased visibility will make the top spots more competitive and less valuable.

Freeing up the right hand side column brings some nice long term benefits. It helps to standardise the experience a little across desktops and mobiles, and it also creates some valuable real estate currently used by the knowledge graph.

As Google gets smarter at answering a wider variety of questions, some of the answers need different formats that don't work well in the normal search results, or don't deserve to push those results down the page.

As Google gains confidence that this space will be available, it can start doing some cleverer and more helpful things with it.

Alistair Dent is head of product strategy at iProspect UK

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