Breaking news came from Google last weekend, right hand side ads are soon to be history and instead 1-4 ads will be shown at the top. Pushing the rest of the ads to bottom of the SERP.
Google has been testing this modification for a while now and apparently the idea is to streamline desktop and mobile search results pages. Another reason for cleaning up the SERPs could be the improvement of user experience by removing the less valuable ad space from the right side, and reducing clutter.
How this change will affect advertisers and agencies optimizing Adwords accounts?
Clickthrough rates, and clicks in general, for keywords ranking lower than 1-4 will decrease.
By showing only 1-4 ads at the top, the value of these positions will rise. This in turn will surely increase average CPCs in many cases, especially for the more generic terms. Higher CPCs are most likely to affect the CPA, COS, CPL and other cost related KPIs.
Long-tail keywords will be even more important for advertisers as the competition for the top position with more generic keywords tightens. Long-tail keywords should be in focus already but even more so after this change.
Also the landing page optimization and conversion optimization in general will be in an even greater role. For advertising, better and more relevant landing pages means lower CPCs because of the improved quality scores. In addition, by emphasising conversion optimization will help advertisers to make the most of the traffic to the site. Although, these should be taken into consideration even without this change.
With increased competition for the top positions and higher costs, getting the most out of advertising with improved quality scores and sales funnels on their site sounds reasonable.