The Hidden Aftershock of Google's Top Placement Update

It’s no secret that Google updated it’s Adwords Placement algo yesterday and while many of its effects are being talked about in places like the WebMasterWorld Forums there are a couple of other changes that are not being picked up by the masses. Yet.

Since last year sometime Google has been on a mission to stomp out its advertisers who are using Adwords for arbitrage and affiliate marketing and this recent update is no different.

While its key feature was the top placement adjustment, which in layman’s terms means to get that top spot you are more likely to pay closer to your MAX CPC for that click. I assume the logic is that if you are willing to pay more per click than you are more relevant than the next guy. The only way it makes sense to me is simple put into 3 words; “Google Money Grab.” This seems to be a popular term for Google this year, every time they to an “update” people are seeing increased CPCs.

Thankfully, most of my clients haven’t seen any side effects of the update (gotta love good account organization!) but I was talking to my friend Scott this morning about the effects seen by some people who run affiliate marketing campaigns via Adwords. A lot of these affiliate marketers were seeing a huge decrease in click activity, if not no clicks at all. After a few IM conversations and phone calls Scott and I were able to determine something pretty huge…….Google hates affiliate marketers Oh, you say you already knew that did ya, well we were also able to determine that affiliates using one account to run campaigns for multiple merchants were hit the hardest, while accounts used to run a single merchant campaign were not noticeably affected.

If this holds up, its going to be a royal pain in the ass for a lot of affiliate marketers. Setting up separate accounts for each merchant is a time consuming process.

We will keep you posted if anything new develops with this update.

and I

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  1. I’m an affiliate, and frankly, the tired argument of “Google hates affiliates” is just plain BS.

    What Google _hates_ are sites that offer no added value, and with good reason. Think about it from their perspective for a minute (advertiser seller). Take a shoe affiliate for example:

    Let’s say someone searches for “New Balance 991”. If the #1 result is Zappos, and the remaining results are Zappos affiliates with prodct feeds, is that a good user experience? I mean, would you rather have a choice between Zappos, Finish Line, Foot Locker, New Balance, etc. etc., or Zappos, Zappos, Zappos,…? This is why Google “hates” affiliates (on the product sales side). Most add ZERO value and cause people to get frustrated. Why would I want to buy from a Zappos affiliate if I can get the same shoes directly from the merchant?

    Now, if I had a Zappos affiliate site, I’d add value by posting articles about shoe fitment, fashion tips, etc. and offering more VALUE than just another product feed. These types of value-added sites NEVER get hit by updates. Unfortunately (or fortunately :)), this isn’t often the case with most affiliates, who basically just have a product feed (eg. no different than Zappos) or worse yet, a redirect straight to the merchant’s site.

    Bottom Line: If your site actually adds VALUE to the user experience, you won’t have to worry about getting “slapped” by Google.

    None of my sites (~12) have been affected by any of Google’s updates. Actually, my average CPC across two accounts has DECREASED! So please, let’s not perpetuate the misguided notion that “Google hates affiliates”. It’s simply not true, and there is no real evidence to support it.

  2. Jason, you are right and thanks for the comment. I guess whats better to say is google doesnt like arbitrage accounts but I still think they are not big fans of affiliates. but yea when it comes down to it, its about value to the user experience.

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