Tuesday, August 14, 2007

Google Adsense Referrals 2.0

Google added an expanded "Referrals 2.0" feature to its web advertising service in 2007. In theory this should provide more revenue from the Google Adsense advertisements on my web site, but so far the results have been disappointing.

Google previously paid a referral fee when customers were referred to Google services, such as downloading the Google toolbar. This has now been extended to referrals to other companies. So if, for example, a customer clicks on a Google ad and buys an airline ticket, the airline pays a referral fee to Google. In theory this is better for advertiser than the regular Google AdWords service, where advertisers pays when the the customer clicks on an ad, even if they never actually buy anything.

So far the results from Referrals 2.0 have been disappointing. Over the last few weeks I have tried some Referrals ads on some web pages. These have resulted in 31,640 third party ad impressions (number of times the ads appeared), 44 clicks (people selecting to look for further details from the ad), but no signups (people registering or buying the goods). As a result there was no revenue from this. The Referrals displaced other regular Google ads, resulting in a drop in Google revenue overall.

It may that it is too early to judge the success of Referrals. One problem seems to be that there are few quality advertisers using the service. Also the matching of advertisers to web pages does not seem as finely tuned as Google's regular ads. There are many ads which do not seem to match the topics of the web sites they appear on.

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