Unlike most of Google’s search engine marketing changes, where there is a lot of hype and little to no impact, the change of the SERP to have just four ads at the top and no right-hand rail is the polar opposite: Insignificant hype and potential for major impact. In fact, this change may be one of the biggest they have made to paid search since they launched (much to the chagrin of major search advertisers), the infamous “Enhanced Campaigns.”
Do I need to panic?
No. This isn’t a time to panic, but it is a time to be hyper-vigilant on your front-end metrics, specifically on Average Position and CPC.
Any search marketer worth their weight will have the following questions running through their head, but luckily, there are answers:
Q: Are my CPCs going to go up?
A: While the engines will never confirm this, you need to do the math. If advertisers in position 5-11 are suddenly invisible, don’t you think they might try to pay a bit more to get visible? Guess who that is going to impact? You. So do prepare to shell out more on your high-ranking/high-volume keywords.
Q: But won’t some ads still show at the bottom of the page?
A: Yes, positions 5-7. But with the new layout the page will be slightly longer. Therefore, do not expect to recover right-hand rail traffic by just sitting at the bottom of the page. You will be greatly disappointed.
Q: I often had keywords sitting low on the right-hand rail. Will they suffer a lot going to page 2 and beyond?
A: The best way to view positions 8+ is that they just don’t exist any more (in the sense that they are invisible to most consumers as they are on page 2+). If you want to try to ride out traffic with those, then just stop trying. It will be a long, losing battle.
Q: Is this going to impact my organic traffic?
A: Likely yes -- organic gets pushed further down and becomes less visible. Anticipate your “free traffic” taking a bit of a hit.
Q: Who benefits/who loses?
A: First, Google benefits (no matter what, they will always benefit). Next will be advertisers that usually sit in position 3 and 4, and “own” those spots, as they will no longer fluctuate between the right rail and the mainline. This will likely lead to improved CTR. Finally, PLAs benefit, as the right rail just became uncluttered.
As for who loses, that is a somewhat larger audience. For starters, for anyone who preferred a cheaper bid and sat on the right rail, their traffic will get knocked down. Next, SMBs and anyone who could not afford to stay competitive on the mainline with bids will either need to pony up for higher bids or find a way to scale their quality score, if they wish to survive. For anyone in positions 1-4, as the above-the-fold real estate has been greatly reduced, it is safe to say that bidding will become more competitive for those positions, which has a strong chance to scale main line advertisers' CPC’s.
How should you prepare?
Take stock of the traffic and return on your keywords that you keep in positions 1-3. If CPCs rise, return drops, and you need to be sure you know your inflection points of value. Also, determine the value of the traffic you got from lower-ranking keywords. You will need to make a decision on whether or not you can survive without it. If you can’t, plan to scale bids and find ways to improve your quality score (ad extensions galore here), if you can survive without it, look to reallocate the spend from them for pushing harder on your top keywords, in mobile, and other avenues (Bing, YouTube, Facebook, etc).
The transition will be anything but pleasant -- but with most major rollouts, the true impact might not be seen for a month or two, leaving you time to prepare. Don’t panic, but you need to go back to your fundamental training of scrutinizing those seemingly meaningless front-end metrics rather than just looking at the ROI. If you catch changes due to this rollout soon enough, you have the best shot at minimizing it.