Google AdWords changes 2016: First experiences in the practical test

Thomas Herrmann

Thomas Herrmann

Geschäftsführer Plan.Net Performance
Managing Director Plan.Net Performance

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Some exciting changes to the search engine giant from California in San Francisco were introduced at the Google Global Performance Summit last Tuesday. In addition to new features in local search ads and important extensions of the Google Display Network (GDN), now Google provides also expanded advertising and display options in the classic search ads, called Extended Text Ads (ETA).

Plan.Net Performance is one of the first agencies in Germany to test the new Google formats for a customer and enlightening experiences were gained.

Finally, there is more space with Google Extended Text Ads

25/35/35. Hitherto the number of characters was limited in the creation of text ads on Google Search for the title, text and URL. This limitation could cause sometimes real difficulties to advertisers, for example, if you wanted to promote a “pet owner liability insurance”.

Since last week, Google offers more freedom to selected advertisers: two headlines of 30 characters each and an 80 character line of text offer sufficient space for the use of USPs and call-to-actions. The domain of the URL display is generated automatically from the stored destination URL, additionally there are two fields for the individual definition of the URL path.

The easier ad creation by expanding the character limit is only partly true. In the old format advertisers were forced to restrict the texts to the most important information. Now there is a risk to use unnecessary text filler, thus distracting from the actual core.

Google AdWords: Google Extended Text Ads

Google Extended Text Ads

Is this a logical compensation after a few weeks ago all ads in the right column were deactivated from the search results? Agreed, for those who were used to the ads on the right side and the left-aligned view for years, Google search results page looked in February almost a bit empty.

The expanded text ads are available since Monday, 23 May 2016. The first results are promising and confirm the expected uplift in the core metrics (higher click-through rates, CTR, at slightly lower CPC). Google itself predicts an uplift in CTR by up to 20 percent. Since the new format during the beta phase is only limited and only few advertisers are unlocked, the actual effect will probably become clear in a few months.

Google’s strategy to further strengthen the premium positions has not changed meanwhile. Thus, the expanded text ads, as other enhancements, increase also the premium positions 1 to 3. The competition will not be lower.

GDN: Cross-exchange for Display Remarketing Campaigns and Responsive Ads

Through the Google Display Network (GDN) advertisers can publish classic display ads on a variety of participating websites and blogs. Under the keywords “Cross-exchange for display remarketing campaigns” Google facilitates its customers to extend their remarketing campaigns through additional inventory sources. So far, Google fell back on the DoubleClick Ad Exchange. DoubleClick is also part of the Google Group.

A major difference between the GDN and the major ad exchanges is the order process. While in GDN usually there are only incurred costs when an advertisement is actually clicked (CPC – cost per click), the Ad Exchanges are generally remunerated for each advertising appearance (CPM – Cost Per Mille). You might think that with the expansion of GDNs to additional ad exchanges, Google is taking a certain risk. Theoretically, this is also true, especially since Google most probably buys the advertising service on a CPM basis and offers it to its customers on a CPC basis. However, it would not be Google, if they did not know exactly what they are doing.

The newly acquired range is limited exclusively to remarketing campaigns. The generated CTRs are known to be many times higher than for campaigns with other targeting options. CTRs of 0.20 percent and higher for standard formats are not uncommon. With the higher expected CTR, Google is also in the position to pay the corresponding higher CPMs, or rather to ensure its own margin. This purchase model can be very successful, as other vendors like Criteo have long proved.

The extension of remarketing campaigns in the GDN to additional ad exchanges thus represents not necessarily a cannibalization, but rather a useful supplement for Google.

Another announcement are the “Responsive Ads for display”, i.e., advertisements that individually adjust to the respective content in which they are placed. This allows to place advertising spaces in the GDN which do not follow the usual format standards. It was exactly with especial formats when DoubleClick was not a very flexible partner. “Responsive Ads for display” should have a positive impact, especially on mobile devices and facilitate native advertising integrations. Google positions itself step by step in a “Mobile First” world and will significantly expand its range through adjustments.

What the new feature actually brings, will only be known in detail after a test. With the increasing “playground” of Google grows also the overlap with other areas of marketing. It is therefore more important to evaluate all the accordingly activities under an overarching strategy and coordinate the most important.

Other advertising opportunities in the local search

Finally, new features for Local Search Ads (LSA) were announced in San Francisco. So it will be possible for advertisers in the future, to highlight their ads on mobile devices and the Google Maps service. “Promoted Pins” put the company logo in the navigation via Google Maps prominently in scene. If a potential customer looks for services or products on the go and clicks on such a pin, in addition to the usual display texts, current information of offers or promotions will be available in the future. Google responded with this innovation to the unbroken trend towards mobile use of its services. According to own statements, one third of all mobile searches relates directly to local services, such as cafés, restaurants or shops. In addition, mobile requests with a local connection grow around 50 per cent faster than the totality of all mobile searches worldwide.

Google changes its appearance as an advertising platform in the context of an increasing competition and a rapidly changing user behaviour. Especially Facebook has been able to benefit from the increasing mobilization of internet usage. For advertisers and agencies, this means to observe developments and innovations closely and to have the courage to experiment and question traditional paths.

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