Google surprised the online marketing world by launching a radical change to its well-established AdWords righthand ad layout on the search page.
The traditional model of two or three ads above the organic search results paired with ads all the way down the right-hand side of the page is no more. Google has adopted a new style reminiscent of how AdWords ads are shown on mobile phones – a number of ads above and below the organic results.
A search today (pictured above) for the new Samsung Galaxy S7 mobile phone shows the new Google Ads format in action.
There are no Adwords righthand ads and four ads show above the natural results. Google stated that four ads would show for highly commercial searches only – a newly launched mobile phone definitely counts as a highly-commercial search and there will be a large number of advertisers running on this keyword today after the launch yesterday at Mobile World Congress in Barcelona.
Also worth noticing that after the four ads, the additional news onebox pushes the first organic result even further down the page. This shows that organic or natural results – the preserve of SEO – will now be further down the page than before.
Anything in ad position five plus is now relegated to the bottom of the page.
As Google promised, Shopping ads remain top right and so are the only ads to appear in that position.
Advertisers and agencies will be scrambling to assess the impact of this major change over the next few weeks.
Any reduction in prominence for the top part of the AdWords auction would most likely result in advertisers valuing these top positions even more highly, therefore potentially being prepared to bid higher for the top four spots. This will result in higher CPCs and therefore higher costs for advertisers playing in this space.
However, the added prominence will also drive more clicks, so higher costs could be offset by better clickthrough rates and even higher conversion rates.
What is also interesting is the question of what value the ads below the results will have in the new layout. Ads that were top-right hand of the page would still get a reasonable clickthrough in the previous layout, although this would of course decrease as the positions diminished towards the bottom of the page.
Ads now below the first page organic results seem to be in a poor placement and the conversion value could be expected to be like something on the second page in the previous system.
Will this mean advertisers fight it out for the top four positions and the auction intensity is greatly increased? Maybe, users are accustomed to the ads at the bottom of the page from their use of Google on smartphones, so that position will not be a wilderness for clicks?
It remains to be seen, but as Google always tests out changes exhaustively, especially ones as fundamental as this, it is likely that the new format will be positive for advertisers. It does suggest that the ad positions down the right-hand side were becoming ineffective and ignored by users. SEO could be impacted negatively and Shopping Ads now have a stand-out position too, which should be beneficial for those campaigns.