1, Google Adsense is changing its payment model for publishers into eCPM.
2. Publishers will now receive 80% of ad revenue after fees instead of a fixed 68% share.
3. Publishers may need to adapt content and SEO strategies to maximize impressions and revenue.
What does eCPM mean?
The eCPM model, which stands for effective cost per mille (thousand), is a metric used in digital advertising to measure the revenue generated per 1,000 ad impressions. It's primarily a metric used by publishers (website or app owners) to understand how much money they are earning from their ad space.
Here's a breakdown of the concept:
Cost per mille (CPM): This is a fixed price that advertisers pay for 1,000 ad impressions. However, in reality, many advertisers bid on each impression with different CPMs.
Effective cost per mille (eCPM): This takes into account all the revenue generated from different advertisers and bidding models (not just CPM) for a specific set of impressions, and calculates the average revenue per 1,000 impressions. This gives a more realistic picture of how much the publisher is earning.
Key points about eCPM:
Higher eCPM means more revenue: A higher eCPM indicates that the publisher is earning more money from their ad space, as they are getting more per 1,000 impressions.
Not the same as CPM: Although they sound similar, eCPM is a metric for publishers, while CPM is a pricing model for advertisers.
Useful for optimization: Publishers can use eCPM to track the performance of different ad placements, formats, and campaigns, and optimize their strategy to maximize revenue.
Here are some additional things to know about eCPM:
It can be calculated for different timeframes (e.g., daily, weekly, monthly) and across different dimensions (e.g., website sections, user demographics).
It is just one metric, and other factors like click-through rate (CTR) and engagement should also be considered when evaluating ad performance.
There are different ways to calculate eCPM depending on the specific ad network or platform used.
Publishers will now receive 80% of ad revenue after fees instead of a fixed 68% share:
For the past few years, Adsense has been implementing 68% of ad revenue for publishers.
The new model differs when third-party platforms buy AdSense to display ads. In these cases, publishers receive an 80% share after the third-party’s fees. What this means for the buy and sell-side fees, one dollar from an advertiser translates to sixty-eight cents for the publisher.
Understand the Implications
The eCPM (effective cost per thousand impressions) payment model differs from the previous predominant cost-per-click (CPC) model.
With eCPM, publisher revenue is based on the number of impressions rather than clicks.
Publishers should understand how this new model works, as it could impact revenue, especially for those whose content aims for high engagement over high traffic volume.
Adapt Content & SEO Strategies:
Google has stated that the earnings for most publishers will likely remain unchanged after the transition to eCPM bidding.
However, the impact may differ on an individual basis. Publishers may need to adjust their content and SEO tactics to maximize revenue within the new eCPM model.
Potential strategies include increasing website traffic volume, improving user engagement metrics, and extending session duration to serve more ad impressions.
Compliance with Ad Standards:
The shift to an impression-based model increases the need for publishers to follow AdSense policies and Better Ads Standards.
Publishers must continue providing a positive ad experience for users by avoiding disruptive ads. This will be critical to sustain ad revenue and remain in good standing with the AdSense program.
With the updated payment model publishers will be able to earn more impressions than clicks per 1000 visits as long as they comply with the Adsense program policies.
