How Google’s New Ad Layout Will Affect Your Business

Thursday 31st, March 2016

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If you’ve noticed things shifting in Google’s search results, then you’re not alone. What comes as a major development is the removal of ads in the right side of the search results for desktop users. In the words of Google, ’right-hand ad rail is a thing of the past’.

If you own an online business and rely on paid advertising to increase your sales, then you’re going to get affected by the latest update.

So What Is The Change? 

On February 19, 2016, Google confirmed the following changes that will affect the desktop search results:

  • When you search for a particular keyword, you can see that four text ads are eligible to be displayed instead of three. This is especially true for ‘Highly commercial’ keywords.
  • In the right side of the Google search result, you can see that it is being used for product listing and Google knowledge panel for relevant queries.
  • In the SERP, if you scroll down the bottom of the page, you’ll notice three text ads are eligible to be displayed.

In case you’re wondering what High commercial queries are- they are the keywords which the users search with an intention to buy a product or service. For example, if you search ‘Rolex watches’, there is an underlying intent to buy the product or to get information about the watch- a commercial intent.

As a result of these changes, for commercial queries 4/5th of the page will be filled with ads. This poses a big challenge for the organic results to appear in the top 10 results.

So does it mean you abandon SEO and invest time and money in paid search results? It’s important to look at expected changes in the CTR and make a strategic decision.

Expected Change in CTRs

According to a study, 56.8% of the users click on the first page organic results when one top ad displayed. 41.5% clicks with two top ads displayed 29.1% clicks with top three ads. With four ad display, we can expect a 15-20% clicks in organic search.

From the above findings, you can see that the latest update will have a profound impact on the organic results in the first page. This is something that you’ll have to keep in mind while planning your marketing strategy.

Impact on Online Marketing

Now that paid search ads eating up most of the organic real estate, the click-through rates for organic results- especially in the first two positions, will probably decrease since they’re relegated to the bottom. This is a wakeup call for all you SEO managers out there to step up your SEO efforts.

As far as paid search advertisers are concerned, this change will most probably drive up the average CPCs due to reduced slots and increased competition. Small companies with less budgets will find it difficult to rank for these high competition keywords as the positions 1 to 4 matters.

If you’re already ranking at 1st, there won’t be much change in the CPC. But if you rank at 3 and 4, there will be a negative impact as the competitors will most likely increase the bids. Either you lose traffic by ranking in the bottom 3 or raise the bids to improve the ranking position.

With more paid listings available for ‘Highly commercial queries’, you need to focus paid landing pages in the buying/decision-making stages and your organic landing pages should be positioned well to capture visitors in research/consideration stages.

In summary, if you intend to counter the effects of this update, you need to create an integrated organic and paid strategy with focus on top rankings and to maintain visibility.

Conclusion

SERPs will continue to evolve and affect the search results as Google is looking for new and better ways to make the desktop experience similar to the mobile search result pages.

However, the key takeaway is that you must adapt to the changing landscape and not become complacent. You should focus on putting together result-driven strategies and tactics using paid and organic searches to maximize your ROI.

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