Google Adsense CPC vs Referrals 2.0


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So for a few days I have been testing the new referrals platform that Google is testing inside Adsense.  Lucky Adsense advertisers get the chance at making extra revenue from Cost Per Action instead of CPC.  The bounty can be high, instead of making a few cents off of the click you could make anywhere from $1.00 to $20.00 (from my experience) and it can look very attractive. 

CPA is also an publishers dream in the internet world.  They get to pick the price per lead and so they can factor in an advertising budget right into their margin that never changes. 

The problem with CPA for advertisers though is that people have to actually click, and then do something which usually requires some kind of purchase.  My experience the last few days has been one of disappointment.  Replacing several of my ad blocks that were high paying CPC ads previously with Google Adsense Referral ad blocks made my adsense revenue drop like a rock.  Keep in my mind click through rate stayed about the same but my ad revenue from the inventory that Google gave me just plummeted.  It could be that it takes a while to trip the revenue back to the affiliate (in this case Google) but I doubt it.  My guess is that the ads simply weren’t compelling enough to get a purchase out of the click or that the buyer is taking longer to respond to the click.  Now obviously with Google Adsense TOS we can’t get into specific revenue and clicks but we are in the neighborhood of a 90% drop in revenue.

This may not be news, Google’s own Firefox with Google Toolbar referral seemed to disregard clicks my tracking showed were there.  On the install end I imagine I also was loosing some of my credit for Firefox installs.  In the case of Google Referrals you have to wonder what assurances you can have about getting ad revenue whether CPC or CPA when you put the power into the publishers hands. 

Simple code updates could kill the mechanisms that report back to Google, and while I believe Google would do nothing sinister you have no idea what the publisher’s intentions are. 

So what do they look like?  Do they look the same as regular ads?  Yes they do in fact for the purposes of this article I have left some ads on the left of this article.  You can see that it clearly says “Referral Ads by Google” but other than that there is little to distinguish CPC ads from CPA.

For us here at Noheat there just seems to be too many variables and too little revenue coming from the Adsense Referrals, we’ll keep you posted if the numbers change but for now CPC seems to be the way to stay if you are a Adsense Advertiser.

Read more posts by Christopher Carey

Comments

15 Responses to “Google Adsense CPC vs Referrals 2.0”

  1. Nerfball on MyAvatars 0.2 July 11th, 2007 9:22 pm

    Hey Wise, Not so fast, maybe you just need to give it some more time.

    From Adsense:

    * When a publisher who signed up for Google AdSense through your referral first earns US$5 within 180 days of sign-up, you will be credited with US$5.

    * When that same publisher earns US$100 within 180 days of sign-up and is eligible for payment, you will be credited with an additional US$250.

    * If in any 180-day period you refer 25 publishers who each earn more than US$100 within 180 days of their respective sign-ups and are all eligible for payment, you will be awarded a US$2,000 bonus (bonus payments are limited to 1 per year).

  2. wiseassoffice on MyAvatars 0.2 July 11th, 2007 9:25 pm

    Thats pretty interesting, its part of the reason I have those ads up. I’ll still give Google some time for the referrals to come through. Seems like there should better user interaction if thats true though.

  3. Vaibhav on MyAvatars 0.2 July 12th, 2007 6:26 am

    It seems like referrals 2.0 has not been a great success for google. the publishers are not using as google expected to. CPC is still the first choice. Google needs to take a look on that again…

  4. Il Giornale di Copenhagen on MyAvatars 0.2 July 12th, 2007 10:38 am

    very interesting

  5. Kim on MyAvatars 0.2 July 12th, 2007 1:20 pm

    Sounds really interesting. Hopefully this will increase the google adsense checks at the end of the month.

  6. WEBマーケティングブログ on MyAvatars 0.2 July 12th, 2007 10:37 pm

    アドセンス、CPC対成果報酬”Referrals 2.0”…

    アドセンスの成果報酬型広告「Referrals 2.0」が数日前にはじまりまし……

  7. Bryan @ One Mans Goal on MyAvatars 0.2 July 17th, 2007 6:07 am

    Sadly the only thing attractive about google referral ads are their looks.

    I’ve used these for quite some time and they are pretty much worthless.

  8. www.BloggingMix.com on MyAvatars 0.2 July 17th, 2007 12:59 pm

    Hi there. I’m here as promised.

    You’ve got useful information for bloggers here. Your other blog at 15blogs.com is really unique and a great idea. I’ll see if my traffic will increase. I’ve stumbled it and I’m about to digg it now. Cheers.

  9. Ali on MyAvatars 0.2 July 22nd, 2007 12:25 am

    Good analysis referrals dont work for me either.

  10. Yanni on MyAvatars 0.2 July 26th, 2007 5:32 am

    To tell the truth, my daily earnings increaded 4.5 times after I installed referrals 2.0 instead of regular CPC, and only on few pages. Now, thinking of changing my whole site to referrals, hope to increase it by 10 fold.!!! It seems to work for me

  11. Wiper on MyAvatars 0.2 July 31st, 2007 1:52 pm

    Our daily earnings increased by 500% after adding referral ads to our website. Those advertisers in our business pay up to $70 to fill out a simple form or to take a free demo account.

    And no, I’m not going to tell which business..

    HAIL to Google

  12. Wiper on MyAvatars 0.2 July 31st, 2007 1:52 pm

    Keep on blogging folks for pennies.

  13. On Stage Lighting on MyAvatars 0.2 October 11th, 2007 2:54 pm

    I suppose it depends on the content of your site and your visitors. I think that the refferals would seem to work better for some generic sites with poor adsense targetting and those which suit the advertisers in the refferal programme. Not seen many advertisers that I feel would convert my site visitors yet but heres hoping.
    Maybe, one day, I will do some research and create a site targetted for those advertisers.

  14. Mswahili on MyAvatars 0.2 October 26th, 2007 2:02 pm

    even on a long term is referral system better than CPC?

  15. Jason Pearson on MyAvatars 0.2 November 9th, 2007 8:29 pm

    This is a wonderful, informative blog. Thank you for opening my eyes to CPC and what is actually happening with Google Adsense. I have tried the referral ads with no success as well. Keep posting such great information and I will keep coming back!

    Jason Pearson

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