I have came across to few people around here complaining about their extremely payouts per click to which some else replies "you may be smartpriced". What exactly do they mean about that? Can anybody please explain?
When people click your AdSense ads but do not follow up with the advertiser by making a purchase or whatever the desired action is the advertiser may report that there were little or no conversions. That means your conversion rate is too low when compared to your click through rate. When that happens you get "smart priced" and your earnings per click will decrease. That is my understanding of it. Someone else may be able to explain it better
So this means that the ads provider (eg. Google, Yahoo...) kind of penalize a particular site by extremely low rates per click? And for how long?
No, that's not it. Here is an example of what I mean. Lets say that you are an advertiser and you are promoting a clickbank product through AdWords. Lets also say that your ad/campaign was clicked x number of times from a certain site with very low or even 0 conversions. You report this to AdWords and they in turn reduce the cost per click for that particular site. You can understand that the advertiser doesnt want to pay for clicks that arent making them any money. This situation usually happens when people who arent really interested in the advertisement clicks it. This can be because of tricky ad placement or any number of reasons. Once a site is smart priced I dont know if it can ever come back from it or not. Someone else may know the answer to that
Yeah ok. That is what I meant by ads provider penalizing a particular site [with low conversion]. One thing to this though: I had no idea an AdWords customer/advertiser had any grounds to complain. I mean we are talking PPC not CPA after all so conversion rates should be out of question or not? I thought that the main goal of a PPC publisher is to bring as many visitors to the advertising site. Full stop. Ie. the aim is quantity and hence low per click payouts (not quality ie. leads and payouts ten/hundredfolds higher).
yeah, i wonder can site that had been smart priced, back again? i what about if the sites convert well again, is smart price will be removed?
kentuckyslone you got it exactly. Basically it is when they reduce your earnings because you are sending through non converting traffic.
That sucks big time if correct. Don't you guys see it? In PPC the conversion rate should not be publisher's worry. As a trade off he/she is accepting the low payout ie. nature of the PPC programs.
Like or don't like...live by the sword die by the sword eh? There is not that many comparable choices as you know yourself I guess
The main goal of any PPC advertiser is to make money. Why would they want to pay you and Google for clicks that do not make any money for them? If the publisher places the ads in a way that misleads, or tricks the visitor into clicking there will be a low conversion rate because the ones who click will not really be interested. I myself use AdWords to promote certain affiliate programs. Each month I am charged a fee by Google for the clicks I have received. Why should I, or any other PPC advertiser want to pay a premium price for no converting traffic? We have to remember that this is a three way arrangement where Google, the publisher, and the PPC advertiser all three want to make money. If you provide quality content and build targeted traffic you will be much less likely to be smart priced.
Agreed. Of course everyone wants to make money. But PPC payouts are the lowest of the low (per click that is) to begin with. Also don't forget that the advertiser is influencing how his ad looks, what does it say, what keywords does it appears for, the design and efficiency of the landing page AND most importantly the amount on offer he/she is going to pay per click. Publisher is far from having the comfort of so many options to rely on. Yes the ad can be displayed in misleading/tricky way, but that is when the "third party's" TOS comes in. And of course if an ad is published against the rules than I agree the publisher should be penalized somehow. But penalize only for low conversions of (for arguments sake) an ad that is in all ways complying with TOS? And even have a name for it ie. smartpricing? Don't get me wrong I spent much more money for online advertising than I ever made from it directly. But I also realize that, as in any other marketing approach, there are risks I need to wear and that there may be times and campaigns where I may never ever see my advertising money back. I do not think that by choosing PPC as marketing vehicle anyone is paying any premiums. Quite contrary - I would say that PPC is one of the cheapest paid advertising tools around these days. If I really want to have some protection and control over my conversions, than I need to go for some more costly advertising options like CPA and such. Anyway I think I know what smart pricing is now and as a publisher I would not like it one bit.
I dont think that is true at all. Do you have an AdWords account? Many keywords are quite expensive for the advertiser. I agree with everything else you just said. As a publisher I do not like smart pricing myself.