In December there were some reports that Google was testing a fourth pay-per-click ad at the top of search result pages, when there are typically only three. The reports were mostly coming from outside of the US.
This week, Google finally confirmed that the testing was over, and the new ad layouts are being rolled out into all markets and languages. From now on, search queries will show 4 PPC ads above organic, and no PPC ads on the side bar. There will be a few exceptions for search queries with knowledge graphs, and search queries with Product Listing Ads (PLA's.)
This is a big change for search engine marketers, as the balance between paid and organic continues to shift towards paid. With 4 ads at the top of the SERPs, map pack disappears below the fold, organic listings fall well below the fold, and the side bar PPC ads (traditionally position 4-10) disappear completely. This makes the first 4 ads by and large the most prominent and important pieces of real estate on the page. This will likely increase click-through-rate on ads 1-4 and reduce organic click-through-rates across the board.
Before (3 ads):
After (4 ads):
Why is Google Making This Change?
There are several reasons that Google might be removing side bar ads from search results. The most cynical explanation is that this will increase competition in Adwords and increase bid prices (less available ad positions means more competition) so that Google can make more money. While this may be true, I am speculating that this has more to do with the abysmal performance of sidebar ads. While some small businesses may find success using small budgets and bidding on low ad positions (ad placements 4-10) the low clickthrough rates of sidebar ads may no longer warrant all of the clutter. The new Adwords SERP layout is much cleaner, and looks more similar to mobile results now. Some are theorizing that a major goal of this change was to unify mobile and desktop layouts.
This change to Adwords PPC layouts will have large ripples across digital marketing strategies:
- PPC specialists will need to rethink average positions in their bidding strategies. Studies have shown varying statistics on CTR of the top 3 positions, but there is no data yet on how position 4 ads will perform.
- Companies without a paid strategy need to get into Google Adwords to capture traffic, as more clicks will now go to ads. Organic CTR’s will slip and organic SEO will lose some effectiveness.
- Map pack is the new page 1. We’ve been saying this for sometime now, but the 3 available spots in the map pack are now more important than ever.
UPDATE 1: Google announced yesterday that this is no longer a test, and that this change is now rolling out worldwide in all languages. Google will now remove side bar ads, and add a 4th ppc ad above organic for search queries with high commercial intent.
UPDATE 2: Since publishing this article, other marketers have confirmed that the testing phase is likely over, and Google is now rolling out 4 PPC ads at the top of SERPs, as well as removing the sidebar ads. MOZ most recently published data showing 19% of search results now feature a 4th ad.