September 18th, 2009
Advert Positions Probably Do Matter
Writing on his blog page recently, the Chief Economist at Google, Hal Varian, was recently dismissive of any distinctive correlation between advert position and conversion rates in terms of pay per click advertising. He stated that the variance of an ad position, from the top of the sponsored links section to the bottom, had a minimal effect on conversion rate percentages. As expected, this create much controversy and debate across the internet marketing world, and at Gillissa, this was no different.
In fact, we have undertaken research of our own, using statistical data from one of our best converting clients, to discover whether we agree with Hal Varian’s findings. From our work, we disagree with Hal Varian, though we must confess that other factors, such as the effectiveness of the landing page and the content of the advert itself, have a greater outcome on the conversion rate than ad position does.
In our studies, the conversion rates did differ by a percentage point through positions 1.0-1.9, compared to 2.0-2.9, and again from 3.0-3.9. Thereafter there was a marked decrease in % rates, which was no different between Google’s own network and the syndication partners.
There is a strong case (we believe) that where a well written and well placed advert in the top listing positions is coupled with a well designed and sales conversion oriented website, chances of getting the buyer are much more strong. Where there is a repeat browse search pattern going on (say to compare prices of flights or hotels), then position may well not matter so much.
Seasonality may well also play its part. All I’d say in summary is that where conversion rates (and cost of acquisition) justify good position, that’s where we’d want to be.
