Google Paid-Search Ads Cost Per Click Rising

Google's decision to eliminate paid-search text advertising down the right hand rail of search engine query results has indeed pushed up the cost per click (CPC) on keyword for paid-search advertising, confirms one agency.

Performics U.S. President Scott Shamberg told Search Marketing Daily on Wednesday the agency sees higher CPCs in the first couple of days, but as the market settles he doesn't think it will become more difficult to bid into the top four positions. "We're seeing double the cost for some keywords," he says. 

Marketers will need to become more strategic in their bidding approach, but that has always been the case, Shamberg says. "The first couple of days in the week there is usually higher traffic online as companies jockey for position, but that's to be expected."

Shamberg says the agency executives have had some discussions about reevaluating the combination of paid-search advertising, product listing ads (PLAs) in Google Shopping and search engine optimization to generate more content, but none of the clients are seeing a dramatic shift.

Performics, a performance marketing arm of Publicis, works with Nestle, Kohl’s, Hertz and Toyota, among other brands.

Shamberg has not seen a shift in market share to Bing or Yahoo based on Google's decision to change the layout. "Sometimes you might see it based on less inventory on Google, but we have not seen a shift or influence in the past 48 hours," he says.  

Google made the decision, in part, for desktop searches to look more similar to mobile search results. Shamberg believes it will push even more desktop paid search advertising bids and buys to the mobile Web, supported by the Accelerated Mobile Page framework that officially launched Wednesday. "It will become a signal on how PLAs work with paid search, and how desktop search traffic plays with mobile search traffic," he says. "It's another tool for Google to push consumers to mobile."

Shamberg also believes conversion optimization will take priority at brands as the market shakes out. It will make their SEO program increasingly relevant and take some pressure off competing for less page search ads on Google.

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