Have you seen your AdSense earnings suddenly suffer a dramatic drop?
If so, you’re not alone.
Many publishers face seemingly sudden drops in their ad earnings. More specifically, their rate per mille (RPM).
Some of the most common reasons include irrelevant ads being displayed, baseless clicks, and even using the wrong keywords. However, determining the actual cause takes an account-by-account or site-by-site audit.
In this article, we’re going to discuss Google AdSense, RPM, and why high traffic could have a negative impact on your RPM.
What Exactly Is Google AdSense?
Google AdSense is an ad network that was created in 2003 for web publishers. The goal behind it is to help publishers monetize their online content.
AdSense is also a closed platform — it pulls ads from the Google Display Network and displays them on the publisher’s website.
Since its release, Google AdSense has arguably become the most popular advertising platform for publishers far and wide. It’s extremely user-friendly, meaning you don’t have to be a tech whiz to get it working, and millions of websites use it, with the number increasing each year.
With AdSense, publishers don’t get paid based on ad views. Instead, they earn their money using the cost-per-click (CPC) model. So, whenever a visitor clicks on one of the targeted ads provided by AdSense, the publisher of the site receives a percentage of the money earned from the click.
As far as the numbers go, publishers earn roughly 68% of the payment from each click, while Google takes a 32% commission. To get an idea of what you might make per click, AdSense provides a revenue calculator which can help you plan your next monetization move.
What Exactly Is RPM?
RPM is the abbreviated term publishers tend to hear the most when they enter the programmatic advertising world. As mentioned above, the abbreviation stands for rate per mille, where “mille” equates to 1,000 clicks.
The RPM method for determining pay rates is the most common method used by Google AdSense, as well as most advertising platforms these days.
There are several types of RPM, but the most common are the following:
● Page RPM – It’s a digital advertisement metric that publishers use to estimate the revenue their site can generate for every thousand page views.
● Impression RPM – Impression RPM measures the revenue for 1,000 impressions per ad unit.
● Session RPM – Session RPM is also referred to as RPM V, which stands for revenue per mille visits or RPM U where U is defined as users. With session RPM, the more ads a user sees as they scroll through your website’s content, the more the value of each individual session increases for the publisher.
These RPM metrics serve as important ways to help keep track of a publisher’s earnings through advertising ads. It also gives publishers a goal they can aim for over time. However, if a publisher attempts to increase their RPMs by adding more ads to a web page, they may find that the user experience will begin to take a dive.
Why High Traffic Can Lower Your RPM
So, we know that RPM allows users to estimate their potential earnings based on the number of page views they receive. We also know that this metric isn’t always going to be 100% accurate considering the fact that a publisher’s page views can change dramatically from one day to the next.
This fluctuation is essentially caused by ad spending on the advertiser’s side.
So, if something like the price of a keyword decreases significantly and a publisher’s highest paying ad displays are based on that particular keyword, their RPM earnings will also decrease significantly.
The ad, or impression availability, also comes into play in regards to your RPM. Google AdSense is a reliable platform in the sense that it guarantees to fill impressions. However, if the available inventory on a site increases, it usually means that the publisher will have to accept lower bids to fill the increasing requests.
It ends up being a case of quantity over quality, where the additional inventory sells for a lower price simply to ensure that the spaces are filled and the impressions are served. These lower-paying impressions tend to drag the overall impression payment average down since there’s no pressure or urgency for advertisers to up their maximum bid.
In turn, these impressions either garner fewer clicks or views, or their payout price per click or view is worth a lesser percentage due to its low bid price.
The bottom line is that visitors won’t click on irrelevant ads, which is why competitive ads are so important. However, the reason for an RPM decline during a traffic increase isn’t always so straightforward.
Issues that end up being the cause often involve overlooked site changes. For example, a publisher’s website may have crawling issues. When Google isn’t able to crawl a web page (which is usually attributed to a robot.txt block), the ads that get displayed end up being completely irrelevant.
Another potential cause could be coding changes within the ads. Even the slightest change can have an effect on a publisher’s earnings as it can cause loading latency. When the high-earning ads take longer than usual to load, AdSense will display the lower-earning ads instead.
There’s always a specific reason behind a drop in a publisher’s AdSense RPMs. However, not all of these reasons can be avoided or helped. A publisher can optimize their content for better click-through rates which equate to a higher RPM, but there will always be some traffic fluctuations that are beyond their control.
Need help with your website traffic or RPMs? Contact us today to find out how we make Ad Ops easier for publishers. That includes troubleshooting Google AdSense issues.