Google’s Interest Based Advertising
Today is the final day for Adsense publishers to update their Privacy Policy in response to Google’s new initiative called Interest Based Advertising. I had mentioned that I don’t recommend opting out of using Interest Based ads and a few readers seemed concerned about this. I thought a short post to clarify my thinking was in order.
(note – this site is not associated with Google.com or Google Adsense and you are encouraged to visit Google directly for more information.)
The idea behind Interest Based Ads is to increase CTR and conversions in regards to Adsense. The current Adsense model is based on Targeted Placement ads and while it has helped Google keep their Advertisers happy in the sense that they save money by not paying for poorly converting clicks (smart pricing) it has not had the effect of increasing Google’s revenue or in increasing the advertisiers overall sales. Ultimately Google needs to increase revenue without loosing advertisers in the process. Moreover Google wants to increase it’s advertising inventory and the best way to achieve this is by getting advertisers to buy more advertising. To do this they will have to provide better ROI to the advertisers.
Hence… Interest Based Ads. The premise being that a large portion of adsense page views are shown daily to untargeted visitors who may be reading any given site for any number of reasons but not necessarily because of any particular interest in the subject matter. Think of people who follow links from one article to another and end up on a site that has little to do thematically with the site they began their journey on. In most cases these visitors are never going to click on an ad and for the few that do they are unlikely to lead to a conversion for the advertiser. The question is – what if such users were presented with ads relevant to their search history rather than ads relevant to the current page they are browsing? Could Google entice more clicks and could this lead to higher conversions for the Advertisers? We will find out…
As for Publishers this should not be viewed negatively as there is a potential upside and escpecially for those publishers who don’t drive primarily targeted traffic to their sites. Given the fact that Google will decide whether to show targeted ads or Interest based ads to any particular visitor means this should reduce the likelyhood of a publisher being smart priced as G can’t hold the publisher accountable for poor performance of Interest Based clicks. (or it shouldn’t as the performance or lack thereof is not in the publishers hands)
To put it simply Google is trying to increase CTR where it feels it can and is not likely to penalize Publishers for poorly converting ads that Google displays on their sites beyond the publisher’s control. The real upside is that publishers may see a nice increase in CTR and earn more revenue even from low paying CPC ads without being smart priced in the process.
Whether this pans out or not I recommend everyone at least take part and test it before opting out. There is nothing to be gained by not giving it a shot. It may not work for some and one can always opt out later.
For those of you driving mostly social traffic this is what you have been waiting for – Google like everyone else is trying to convert social traffic. It is a huge market and so far has proven hard to monetize. Will Interest based ads work? Who knows but if it does publishers will see much better returns from their Adsense accounts. If it doesn’t then publishers are no worse off than they are now. And that is why I recommend everyone give this a trial period in order to evaluate the results. If your earnings tank – opt out but at least find out first.
Cheers
Griz
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Sooo it sounds to me that Google is trying to make social traffic profitable???!!? lol
Ah, I left that comment before I read the last paragraph, hahaha
Ray… absolutely everyone is trying to monetize social traffic. There hasn’t been a successful model yet but there is huge interest in finding one. Just ask the media networks… lots of traffic but no money.
I agree, everyone is looking to monetize social media and traffic… hopefully Google will make it easy enough on their advertisers to do so… by the way, great article… thought provoking
Fully agree with you Grizz. If this works out, I too might be sticking some Adsense in eightbiz.com. At least I feel it would take away the worries of being smart priced due to clicks from irrelevant traffic. Like I said in a post of mine immediately after receiving that email, all of a sudden, niche blogging and keyword targeting don’t seem so important as it used to be.
I feel the only worry now is what the guy has been searching and where he has been prior to stumbling into our blogs. If he has been searching and has been to some really low paying keyword sites, we might suffer the same fate as Google would be showing them those low paying Ads instead of those which we have worked for. Still, I feel we would not be smart priced as they will be still considered targeted traffic who has interest in what the Ads are showing. Our blogs are just being used as Google’s target board.
On the other hand, if we opted out and we prefer to show Ads that are only relevant to our post, social visitors, if they stumble in, will not be clicking on Ads that they have no interest in. However, if we stay opted in, these social visitors might be so bored with our post that they will exit via the Ads that shows something that interest them.
Just my 2 cents, but I am staying put with Interest Based Ads for the moment to see how it goes. I don’t think there is way to totally block out social visitors to our blogs. We could use something like OpenX to show Ads only to search traffic, but then, if Interest Based Ads works, then it will be a big waste of good social traffic.
Again these are just my shallow opinions.
So… Let’s see if I understand this correctly. Let’s say I have a tightly targeted site on weight loss, but a visitor has been doing a lot of searching on doggie obedience training before coming to my site.
That visitor will then potentially be served several ads based around search history, so the ads will most likely be related to doggie obedience training rather than wieght loss. Is that correct?
Then I suppose my next question is about trying to determine CPC (and therefore my earnings potential). Let’s say my tightly targeted weight loss site is built around related keywords that average $5.00 CPC, but the visitor with a rich search history in doggie obedience gets served a bunch of ads related to that topic that average only $2.00 CPC. Haven’t I just lost money per click?
I guess my question in this: how can I target what ads I want to have served? Will the ads first be based on my tightly targeted site and only go to search history if google has a hard time figuring out what my site is about? Or vice versa?
Sorry if this makes no sense. I’m trying to work through this new model, and honestly all of adsense is new to me.
Thanks for your input, Griz!
Costa,
You and I share the same view – I am hoping this leads to more opportunities to use Adsense on a lot of my sites that have been moth balled. If it reduces smart pricing then this will be a huge benefit – I’m not saying it will but if it does…
Cinderella,
You will gain a $2 click instead of no click. You are assuming that the “doggie” visitor would have clicked a $5 weight loss ad. Chances are they wouldn’t click any ad if the “doggie” ad wasn’t shown. If they did click a $5 weightloss ad then you would probably only get 5 cents as they were not targeted for the ad and likely won’t convert.
Keep in mind that this is all conjecture at this point but my feeling is that you will still see all the normal targeted traffic clicks you currently have but you will now receive additional revenue from visitors who would never have clicked an ad on your site under placement targeting. You should see additional revenue and not a replacement of $5 clicks with $2 clicks.
Oy! I think my head hurts! LOL
Thanks for the clarification, Griz.
Cinderella,
I hope that “was” clarification. Lol
I should mention that people should still be optimizing their blogs for targeted traffic and ads. I’m not sure G will ever replace targeted traffic CPC with this model. Even without smart pricing sites relying solely on G’s interest based ads will likely only make low CPC. I may be wrong but I doubt you will get a high paying credit card ad on your “doggie” site but who knows how this will work. It is definitely worth finding out though.
I’m starting to understand the concept of interest based advertising and how it will show relevant ads based on what a visitor is searching for via the search engines. I think this is probably going to be a good idea. But what I don’t understand is, what ads will be shown to social traffic that comes directly to your site? If they haven’t searched for anything in particular, I’m guessing that they will still be shown the ads that we have targeted on our site. Am I correct?
Golf Tips (Nick?)
You would be surprised at how much info G has regarding your surfing habits. Between Analytics and Doubleclick just about everyone online gets tracked via cookies. I’m no code monkey and will let the experts explain how the tracking is done but if you use Firefox you can add a Firefox Add-On called Ghostery to your browser and spy on who’s spying on you. You will notice just how pervasive Doubleclick is and Google’s Analytics.
Because of this G will know your history regardless of how you or another visitor might find a blog. Once you arrive via a bookmark Doubleclick checks it’s cookie on you and serves up either the targeted ads (if that is your area of interest) or serves up interest based ads based on what you have likely clicked on before (I’m guessing but that is how I would decide what ad to give you. No point in giving you a high paying credit card ad if you have shown a history of clicking on “dog grooming” ads. I’d give you a dog grooming ad)
The point is that G knows people’s surfing and more importantly “clicking” habits already. It won’t matter how you find a site.
Thanks for all your updates on this. It makes it easier to understand when you put it in layman terms.
Your welcome Carole – we’ll know a lot more in a month.
Grizzly,
Yeah, it’s Nick Griz. Sorry about that. Thanks for the explanation. I was aware that you can be tracked everywhere you go on the internet so that does make total sense that G could use that info to show ads catered to you based on your ’surfing habits’. And now I’m actually looking forward to seeing what affect social traffic has on my revenue now. It’s probably still good to wait awhile to see how this all works out, but if it makes a difference you may as well chase socializers as well.
Nick
Exactly Nick, I’m hesitant to think this will be the answer to monetizing social traffic (I still don’t think social readers are going to click many ads even based on their interest) but it would be nice to be wrong.
Very interesting idea. I think it is worth a shot, I mean what else have I got to lose. I’ve only made a few hundered bucks for the internet thus far.
Keep us updated Griz, on your results. I’m interested to see how this will pan out.
CJ
CJ – If my sites start going south you will all know pretty quickly.
If this allows someone to finally effectively monetize social traffic, more power to them. But looking at this from an end user’s perspective, I would be really frustrated if they kept showing me ads based on my search history instead of what was related to the site I’m viewing. If I’m reading a bunch of dog training magazines and books, then pick up a hot rod magazine, I want to see stuff about hot rods, dang it. I don’t want the whole (adsense-using) web to start blending together based on my penchant for Googling “one-legged midget clown porn”. Or uh… whatever I search for a lot.
Dan,
Google allows both publishers and end users to opt out – undoubtedly because people will still want to see “one-legged midget clown porn” when searching specifically for it. Lol.
Who wants to start a pool on which date this blog ranks number 1 for “one-legged midget clown porn”? There is long established history of this kind of thing happening with Grizz’ sites!
oh man… here we go again!
now is the last day ? gotta add privacy policy to my blogs now, thx grizz !
I think I have all my Adsense sites done. I hope! Seems every once and a while one pops up from a long time ago that I have forgotten about!
Thanks for further explaining this.
I monetized the hell out of MySpace for a while.
Darn MySpace ruined that fun. 
“one-legged midget clown porn”
forgot to add that.
Make Money with oil filters is a lot easier to remember.
Thanks for the info Grizzly,
I hadn’t really looked into this at all yet , and now I don’t have to. Pretty simple really, and I too hope it works as every little bit helps, right?
Oops! It looks like this site is becoming a ‘bad neighborhood’ site with all the clowning around.
I was just here for the oil filters.
I finished getting all my sites updated this evening. I thought I got the all over the weekend but there were a couple of HTML mini-sites that I forgot about.
I think this may be a good thing. IMHO if I have created sites that are highly targetd for a specific group of people, odds are they have spent signifcant time researching or reading on the topics I cover.
Using the dog obedience example from earlier, I think it is safe to assume that most users that will find my dog obedience site that sits at the top of the dog obedience niche are looking specifically for dog obedience related information or products.
Time will tell if it helps or hinders…
Thanks for the articulate post Grizz.
Hmmm, wonder where you got that midget phrase from…
I have a (rather muddled) question Griz.
A lot of people in my field of business are wondering about Google Interest Based Tracking and how it affects us, lol!
(obviously we don’t use Google Adsense).
Because most of us use the Google toolbar, we have deleted our cookies and downloaded the addon which is supposed to erase double click (it doesn’t always work though).
The reason behind this is that our particular browsing habits, when building our sites, are not quite like the normal run of the mill ‘what can I buy’ type browsing…
But when we were searching, we were getting a notice on our search results page which told us that our search results had been geared to our ‘interests’.
This is affecting all sorts of things, including the way we assess keyword relevance and competitors when we build new sites.
So, I guess the fact that we are religiously erasing cookies will affect the Adsense adds we are shown.
Now, those of us in my field are just one example. As more and more people realise their search patterns are being checked and stored by Google (those who didn’t realise this already…), they too will be looking for ways to opt out of having their search history recorded.
Just wondering how this will affect the whole scenario.
I’m not sure when interest based advertising will start, but I can say that in the last 3 days I have noticed a significant increase in my ctr and a nice bounce in my earnings.
However this is happening I’m happy for it.
Hiya Grizz,
I’m all set to go on my blog sites with the Privacy Policy, and it’ll definitely be interesting to see what happens with the interest based advertising, especially if we all see the increased CTR.
Before your clarification of “interest based ads”, I wasn’t too clear on what interest based advertising means for us bloggers and/or website publishers. Now I get it.
I’m been happily surprised (shocked actually) to see the CTR increase on my new American Idol Fan Site, and after last night’s show performances, I nearly fell off my chair when discovering the high rate of Google Ad clicks. Yippeee!
Hi Griz,
Does it mean that now I can become famous and rich with a social blog.
Grizz,
What exactly do you mean when saying “Today is the final day for Adsense publishers to update their Privacy Policy”? I’ve put in the suggested Google wording on my Privacy policies that you showed us several posts ago. I have multiple blogs and sites, one site which has a lot of HTML pages, but not a privacy policy on each one per se. Should we be concerned about Google shutting down an account over this privacy policy issue?
As far as I’ve understood from Google, opting out does not mean that you opt out as a publisher. You just opt out as a user of the Google search engine, so this only means that Google won’t track your web surfing behaviour in order to serve you related ads on the sites you visit (not on those you own). So, as long as our sites’ visitors don’t opt out, our sites are all in by definition and there’s no way to change that.
I can’t wait to see if there will be any improvement in CTR in some particular niches which are very competitive, yet very poorly converting from my personal experience so far.
I don’t that the interest based advertising is going to be pushed out to all blogs immediately. If i remember correctly, interested based adsense advertising is going to go ‘live’ on a select set of site first (my guess is really big sites like the NY Times, etc) before it gets to ’small’ guys like me. It may be weeks or months before we really start seeing how it all pans out.
Here’s my take: I have done a lot of work to get ONLY Google targeted traffic to my sites and I don’t want to mess up something that ain’t broke.
Now, I think I might find a friend who has a Google adsense account and have them NOT opt out of the interest based adsense ads and do a test there. That way, if my friend likes the results, then I can slowly convert my (his) other sites to it. but for now, on MY adsense account, I have opted out of interest based ads.
Griz, I would really appreciate you sharing your results over the next few months as you stay opted “in” to interest based Google adsense.
Anyway, rambling a little…
AL
Ok I know that the interest based adsense ads only started rolling out yesterday. But since yesterday my CTR has fallen off the planet to 0? Still tracking my normal amount of visits and impressions but I have know gone a 24hour period with not one click and I have not seen that kind of a dry spell since back in the day when I started almost two years ago now.
I am not panicking yet but I was wondering if anyone else has seen a sudden DROP in their CTR in the last 24hrs? I will say that a few days of this kind of results and I will be pulling the trigger on that opt out of interest based google adsense ads sooner than later.
Hello Great and Powerful Griz,
I have a site that has been gaining in the search engines. In fact, G had me ranked 11th to 14th for several keywords. This was resulting in decent daily traffic and associated $$$ from Adsense.
I have been steadily increasing the links and occasionally adding new content. About a week ago, I added related, but not quite directly related content. G dropped my rank to the 50s. The traffic completely dropped off as did the $$$.
I added new content that is spot on topic, but my ranking remain in the 50s.
Any ideas how to reverse this downward trend? Should I delete the “offending” page? Should I just create new content that on topic? Should I leave the site alone and just focus on links?
Please advise, oh great and powerful Griz.
As always, thank you very much in advance for your advice.
Lane
Lane,
That sounds like something that happens to me all the time, lol. 1st page, and then I drop off into never never land and eventually make it back to page 2 or 3.
Thanks for commiserating David, but it is frustrating, isn’t it? It just doesn’t make sense to me…. It just seems that big G decides to be fickle one day and points it’s finger at you and sends you to purgatory….
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I am not sure what to make of this interest based advertising. Over the past few weeks, since it would appear that G have been ‘testing’, my overall CTR and earnings has been way down for a few days and then seem to pick up again only to fall over again.
Yesterday, the day of launch, my CTR again fell through the floor even with the same amount of pages impressions, which remain steady throughout.
Today, i thought I would opt out of interest based ads to see if there would be any difference, and there was – immediately!!
Unsure whether it was coincidence or because I opted out, but for about six hours after opting out, my adsense stats ceased to track anything – no impressions and no earnings!.
I got a little worried so opted back in to interest based ads and more or less straight away, my adsense stats started to pick up, showing impressions and earnings although CTR is still way down.
All my sites were showing relevant ads, so it wasn’t like a couple of weeks ago when the ads were far from relevant. Could have been coincidence (perhaps adsense fell over once again) or it maybe that they don’t want anybody to opt out.
Alan
Griz:
Do you have some info re: flagships – what is the primary purpose, etc.? I PM’d Tel @ THW and he has yet to get back to me… I just wish to ensure that my back link techniques are in proper order for the money site.
Interest based Adsense, huh?
Good? Bad?
~Scooter
Well, it looks as though adsense did fall over for a few hours this morning (UK time). Just been reading over on the adsense forum about it. Just coincidence that I happened to opt out of interest based advertising just as adsense stopped.
I have just opted out again, really to prove a point although whether it will or not is anybodies guess.
Considering I have some 50 sites spread over 13 domains, income from adsense is pitiful to say the least. With the c**p CTR of late, I am beginning to wonder if it is all worth the effort. With an average of less than a dollar per site per day, demoralised is not the word for it!!
Alan
I have been watching my CTR for the last few days, and so far it appears I am actually making more.
It is still to early in the game to know for sure, but this may be a good thing.
Grizz, since you have such a wide variety of sites, I’d be interested to know if you have seen a change in earnings.
hi Griz and all buddies!
I hope you are back from your week long holidays and enjoyed… you were on holidays..??
for this interest based ads, I want to add that I think if I opt out from interest based advertising as a webmaster, this will only effect my viewing of ads not for individual who happens to be on my blog and has opted in and will be shown ads depending on his own search history or base of interest. I think the ones who are getting social traffic will be more befitted and ones who are getting more search engine traffic will still not be on the losing end but instead it is to some advantage for them. am i right..??
One thing which i am experiencing from 10 April onwards that the numbers of exit links on my statcounter (ones which are all google-leads) are not exactly registered by my adsense account on google. for example if i get 10 googlelead exit links on my statcounter, i only see 5 or 6 on my adsense account report. Is this happening with others too…?
For Griz, Although its been a while since i posted any comment, i was busy in implementing the learning i ve got from you and it is turning out great.
I dont know if you remember me i joined this awesome network of IMs two months back. Just wanted to share my little success 
Zane Coreshi
Has anyone seen any changes in click thru yet? I think mine have actually went down. Also, does this change the ads on a custom search? My site is for books, and the ads it is showing seem crazy now!
Nate,
I seem to have the same problem. My daily CTR is usually 4% to 8%, but has dropped to under 2% the last 2 days.
Ditto my earnings – usually $1 to $2 per day (I’m now implementing what I learned here to get more traffic), but around $0.10 or $0.20 the last 2 days.
I’m in Asia, so when I check my blog, the ads look relevant.
Is anyone else having trouble?
After 3 days of under-performance, I opted out. I’ve remained opted out for the last 2 days, and my earnings are back to normal.
Hi Grizz,
I wonder if you have seen a change for your income yet?
I’ve been checking my CTR carefully and it looks like I am on the way making more money.
Anybody else experiencing the same?
Cheers,
Volker
My CTR has fallen through the floor too, and I haven’t opted out. I don’t think it’s anything to do with whether you opted out or not. I think they are servings ads people don’t want for some reason.
Hey griz, read through your beginner blogger blog, and your today blog and a few posts on your makemoneyonline blogger blog. Love that you’ve been teaching me so much. Just wanted to say, I had several crappy blogs all over the place. Because of one of your posts saying how bad ads effect your entire adsense account, I took your advice.
Simply removing my crappy adsense that had been smart priced from at least all of the blogs I could remember doubled my ECPM… And it didn’t hurt revenue one bit.
(Although maybe that had something to do with intrest based advertising, I don’t know)
In fact halfway through the month and I already have more revenue on adsense then last month without adding any pages, and I still have some new blogs that I have been optimizing for SEO but haven’t put up adsense for them yet. I am actually getting clicks over $1 now, which didn’t really happen at all before…
Anyways, I’ve recently discovered that If I incorporate and get an EIN that I can have multiple accounts on adsense since I will use the compnay name.
But I’m curious as to google essentially “smart pricing” your entire adsense pub id. If I eliminated all the crappy adsense ads from non targeted sites, does that mean that I don’t have to worry, or is my adsense ID effectively “poisoned” from a couple years of bad monotisation, or once the bad ads are gone, will my results return to where they should be?
In addition, since now google is going to be using intrest based ads, does that mean that removing “bad ads” that are smart priced might be a mistake? Do you think that smart pricing is going to be irrelevant?
That explains why, after going to my Make Money Easy Online site and other money sites, I went to my Natural Cures and Natural Remedies site and was dished up a bunch of make money ads by Google.
Some people are making more and some are making less. does anyone actually have some real stats they can share. any testing, etc. ?
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Hi Griz…
An avid follower of your blog, the MMO for beginners and also becoming a fan of this one. U have aptly said that there is no gain opting out of interest based ads. One concern though… what do you think will convert better after that? The social traffic or the search traffic. I mean what should we chase more?
For now i’ll stick to SEO, as U have recommended in one of your blogs that once “we stop blogging for sometime, the social also vanishes”. Hope I am on rt way.
Have also sent you a mail. Thanks once again for all the amazing work you have done for Internet community.
Saurav,
India
Grizz I just saw this http://www.jensense.com/2009/05/03/clarification-from-google-on-new-adsense-policies/ over at Jensense – specificaly she links to a Google blog saying that you must not place ads immediately below titles where they may be confused as links to content. Whats your take on it?
Just wanted to let you all know that I am still seeing an increased CPC on my blogs. I think I like it
Grizz, you are the man. I moved up on some really nice terms using your tactics.
Grizz,
I’m just starting a new blog, http://moneysavingzone.co.uk, and I’m using a modified version of your theme (courtesy of SEOZombie). I’ve noticed that you post your full article to the page rather than using the “More” option part way through the article. Which is the best approach to use?
Thanks.
One more thing, in one of your articles you mention linking your blogger post title back to the site home page using your target anchor. How do you do this?
@James
You will find your answers from http://beginner-blogger-basics.blogspot.com/ which as you might have noticed is a griz-blog where he explains all the basics for blogger blogs. There is some outdated info but for starting a blog that is the best guide I have found