AdSense and AdWords are two sides of the same coin. AdWords gives advertisers a means to drive targeted traffic to their site on a cost-per-click basis, and AdSense allows site owners to share that advertising revenue by hosting adverts on their websites (or video, apps, games etc). Traditional wisdom is just that: Adwords is for advertisers and AdSense is for publishers and ''never the twain shall meet''.
With that long established wisdom in mind it is not a surprise that eyebrows were raised when the official Google AdSense Google+ page started suggesting that publishers might want to look at buying AdWords ads to increase site traffic.
Were are they suggesting that Arbitrage is now OK? Had they forgotten that the publisher would pay 100% of the price of a click but only receive 68% of the price when the visitor left via an ad? Even ignoring the fact that page CTRs are never going to be 100%, those numbers don't make the idea seem too appealing.
Let’s be clear – Arbitrage is not allowed
Ad Arbitrage is the process of buying cheap traffic and then making a margin by having that traffic leave via higher priced ads.
Arbitrage is most commonly practiced by buying from one source and selling via another, rather than buying and selling to the same network. Margins can though be made by buying and selling on the same network by targeting related topic areas where a price gap exists. For instance users searching for online gaming tips might be targeted, in an affordable way, by ads for content related to the higher paying gaming hardware topics.
Unless the CPC difference is particularly extreme, this can require very high page click-through-rates to make any return on the advertising spend. That lends itself towards very low quality pages that are created with the sole aim of having the user click on an ad.
This type of set-up is specifically prohibited by Google advertising policies (Advertising policy – Arbitrage) and as such could endanger a publisher's account. If AdSense weren't talking about Arbitrage then why would publishers use AdWords?
Target multi-visit users
Each time a user returns to your website there is a chance that they leave by a monetised link. Targeting visitors who are more likely to make repeat visits then improves your chances on getting a return on the cost of that visitor.
One way to do this is to understand what content drives repeat visitors. This is one of those odd pieces of data that you think would be easy to get at through Google Analytics, but it is surprisingly illusive.
Example: Content that, by its nature, changes frequently can perform well in this respect. News sections of sites and events - particularly when users are entering via top level pages rather than individual items.
Using AdWords means that you don’t just have to target by landing page, but by the actual terms used. Identifying phrases that might indicate regular searches can be a clue to finding those repeat visitors.
However you identify and target possible repeat traffic sources, monitoring is vital. By including campaign tracking variables in AdWords and varying them for different landing pages it is simple to look back at visitor loyalty reports to identify which of your AdWords campaigns are generating those repeat visitors and even what revenue is being generated by them.
Target content generators
On sites where AdSense revenue is driven by user generated content, then it can often pay far better to target content generators over the eventual consumers.
Take a car classified site as an example. Targeting "cars for sale" searches means that each click pays for one user who may or may not leave your website by a paid link. Targeting "sell your car" searches means targeting users who might add content that will attract multiple potential buyers to the site – effectively multiplying your reach.
Re-targeting, where you target users who have exhibited certain behaviour, can also be used in this way by targeting those who have previously contributed on your site. An events listing site, for example, could target those users who have seen a "Thank you for adding your event" page.
With retargeting set up correctly a site owner could target those who have previously submitted an event, but not returned to the site recently: Prime candidates to ask for more content from.
Targeting users likely to amplify your message is another way to get additional value from your paid traffic. Bloggers, frequent users of social networks and other online influencers can bring real value to an AdSense monetised site without ever clicking on an ad themselves.
Placement targeted ads in particular open up some interesting possibilities with regards to raising awareness of your site amongst influencers in your niche.
Placing your ads on sites likely to be used by bloggers and journalists in your niche can increase your chance of getting coverage. You could even go as far as to target placements on a blogger's own site – but be sure to make your website address clear as they won’t want to click on adverts on their own site.
Again, re-targeting can be used to reach those influencers too. You could, for instance, target users who arrived at your site via a particular social network, or those who visited content that is likely to appeal to these groups such as "write for us" and "press information" pages. Once these users have visited your site you can then target them later as part of a campaign that might have wider interest.
Possible doesn't mean easy
Average visitor revenues can be tight on AdSense sites, particularly when AdSense is the main or only income source. Whilst it is certainly possibly to get a positive ROI on traffic sent to AdSense sites from AdWords the margin for error is slimmer than in some other cases.
That narrow margin means that continual monitoring and improvement are vital. Constant review both with mind to maximising revenue and in driving down the costs are the only way to make it work long-term.
AdWords frequently release deals for new publishers that offer subsidised advertising in your first month. If you haven’t tried AdWords before, they offer a great way to get started without bearing the full cost of the ‘learning phase’.
Paying for users on a per click basis might not be right for every publisher, and almost certainly isn't right for every type of website visitor. Get it right, and it can turbo-charge your website!
Note: The opinions expressed in this article are the views of the author, and not necessarily the views of Caphyon, its staff, or its partners.
Mat Bennett is MD at OKO Digital and has been an involved with Google AdSense since it was launched in 2003. Mat has most recently led OKO to join the new Google AdSense Certified Partners programme allowing them to lend the company’s experience with the programme to AdSense publishers world-wide.
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