Google's premium ad network for professional publishers is AdX which is run via the google ad manager product and has been on a CPM basis for over a decade. Only small sites are on adsense which pays CPC.
The net change here is probably almost nothing, just the smaller sites that never use google ad manager will see the change but any publisher of note will have been operating with this for as long as they can remember.
With click through rates continuing to decrease it's likely they needed to make this change to keep the long tail sites happy and generating some revenue, they would back out the CPC to an effective CPM anyway.
Me:13+ years in digital publishing and advertising.
Me thinks that this is related to the youtube change. Before only ads that were clicked on counted in earning revenue for Google and YouTube. With this change every inpression is worth that much more.
> Before only ads that were clicked on counted in earning revenue for Google
This certainly wasn’t true 10 years ago. I’d have low traffic pages go without a click but still earn some cents in revenue that day running Adsense (effective CPM would be a rough baseline of ~ 1/10th what a page with clicks that day would earn).
> As a general market trend, why are click through rates decreasing?
Because the advertising industry has structurally educated users to try their hardest to ignore the ads, resulting in every more obnoxious ads, which are then even more forcefully ignored. And that in turn gave rise to adblockers, which are now more or less a requirement if you don't want to lose your sanity while browsing the web.
> which are now more or less a requirement if you don't want to lose your sanity while browsing the web
For a long time I wondered why people said this. I don't use ad blockers and didn't feel it was that bad.
Then 2 things made me understand. First, I pay for YouTube. If you don't and don't block their ads, they seriously test your patience as you browse. I tried it for less than an hour before I couldn't take it anymore.
The second was looking for torrents and hacks (it was for a legitimate and unambiguously legal purpose too, no gray area, but long story!). Those sites are literally impossible to use without ad blockers. Same thing for tools related to diagnosing PC issues. It's all ads over ads over scams and trying to get you to install some adware as you navigate the site trying to install the actually legitimate tools.
I very rarely do either of those things (YouTube without subscription, and navigating the "gray" web), so I never realized just how fucking awful it can get.
Hell, I'm a YouTube Premium subscriber and I still have an ad-skipper for all of the in-video promotions. It's not quite as bad as direct YouTube ads have gotten but it's still a noticeable change in itself.
There seem to be some logical considerations that make the growth of advertising self destructive for advertisers. The big one is that the more ads one sees, the less likely they become to interact with any given ad. There will also likely be an increased ability of users to ignore the ads they do see. As advertisers see returns from advertising decrease, the costs for advertising will gradually trend downwards. This will enable even more advertisers to start advertising.
It's almost like a sort of reverse network effect. The bigger you get, the less desirable your product becomes. And the advertising industry's getting quite large.
Also there are more "branding" ads which are placed just to get the company's logo in your face and don't necessarily need a click to do their job.
If I want to advertise my new Windex(tm) flavored Mountain Dew[1] then all I need is people to see it. They're not likely to buy it from a click, but I want them to remember it next time they are at the grocery store, and I'll pay to shove it in their browser.
I'd also like to see a source for that claim. Been working in digital advertising for 10 years, so I'd be seriously interested. We've changed so much in our advertising over the years I wouldn't be able to tell whether that trend really exists.
The net change here is probably almost nothing, just the smaller sites that never use google ad manager will see the change but any publisher of note will have been operating with this for as long as they can remember.
With click through rates continuing to decrease it's likely they needed to make this change to keep the long tail sites happy and generating some revenue, they would back out the CPC to an effective CPM anyway.
Me:13+ years in digital publishing and advertising.