A few weeks ago, Google hosted its annual AdWords live stream to announce the latest batch of additions to its ecosystem. In keeping with tradition, the changes came fast and furious. For me, the most significant changes were a slew of new mobile ad units. At the event, Google announced three new graphical ad units for automotive, hotels, and mortgages. These are in-your-face ads –- often taking up nearly the entire space above the fold with just one ad.
And while it’s true that auto, mortgage, and hotels are massive categories in AdWords, to me this wasn’t the unifying aspect of these three categories. Rather, the similarity lies in Google’s ability to obtain structured data from advertisers, which Google describes as “a standard way to annotate your content so machines can understand it.”
Think about most hotel searches. The query is almost always a combination of a geographic modifier and the word “hotels” (Las Vegas hotels, Las Vegas hotels south strip, Strip hotels with suites). Hotels already have databases with all of this information organized, so all Google wants is for hotels to upload their data (in addition to price, hotel photos, phone numbers, Web site, and other database info) to AdWords, and then let Google create ads based on this information. If you’ve run ecommerce campaigns over the last few years, this will sound quite familiar to you, as this is the same concept as Google Shopping Ads or Product Listing Ads (PLAs).
What’s particularly interesting to me about these structured data ad units is that they deemphasize both keywords and ad text. Essentially, the role of the advertiser is to provide a properly formatted feed to Google and set the right bid amounts, and then let Google determine where and when to show your ad.
I’m not suggesting, by the way, that this eliminates the need for SEM experts to be involved in the process. There is still plenty of optimization for SEMs to do, be it in feed structure, bidding, or ongoing optimization. What I do see, however, is the beginning of the end of the dominance of text ads in SEM.
Google does not launch new ad units just because its strategists are bored; they launch such ads because they work better than others. In the case of these three new units, it makes sense to me that these would outperform text ads; mobile screens are smaller than laptops, so to make ad units stand out, they need to be graphical. Moreover, it’s impossible to run right-rail (side) units on mobile search results due to space constraints.
So if you’re Google and you’re seeing more than 50% of searches performed on mobile devices, you’d better come up with a new ad unit that monetizes mobile really well, really soon. These units seem to achieve that. Given that only a few advertisers (and in some cases, just one) will win the auction to have their graphical ad show up, it’s likely that the bidding competition will be fierce and the CPC s will be high. Better CTRs and better CPCs: That’s just what Google’s doctor ordered.
In the near future, expect these units to roll out to other categories where structured data can be used: airplane tickets, insurance, professional services, and taxis are just a few examples of what we should see coming soon. And there’s no reason to expect that we won’t be seeing these pop-up on desktops as well. While not as urgent a fix as mobile, I suspect that structured data units will out-monetize text ads on your computer as well.
So goodbye text ads, goodbye keywords? Eventually, yes. Next time you decide to take a vacation at the beach, don’t forget to check your favorite SEM blog. Things change fast around here!