Having just revamped their Google AdSense referral program to put the screws to its affiliates by reducing (or eliminating) commission payouts, Google is now reducing the payouts for Google Pack and FireFox downloads.
Google Pack: Currently, you can earn up to $2 when a user downloads and runs Google Pack for the first time after being referred through your link or button. Starting the third week of February, each successful Pack referral will earn up to $1. This change will apply to all referrals for Google Pack and is independent of user location or publisher location.
Firefox: We will also be reducing payments for Firefox referrals from China during the third week of February. This specific referral payment change will only affect installations from users in China. As with referrals to AdSense, this is independent of your location as a publisher.
We understand that these changes may decrease revenue for some of you currently participating in these referrals programs. While it is our goal to help publishers earn as much as possible with the AdSense program, like any other referrals advertiser, we are constantly evaluating our campaigns to make them effective and sustainable.
We understand that these changes may decrease revenue for some of you? Doh! Google did add one piece of good news. They’ve decided to allow AdSense referrals from Japan and Latin America. Affiliates in Europe and the UK are still out of luck.
My gut feeling tells me that Google revenues are down and that they’re doing everything possible to post a good quarterly report, even if that means taking it from the affiliates who help them build their business.
I believe Google’s trouble started when they made their ads less clickable. Many AdSense publishers saw their revenue dropped heavily because of the measure. Markus at Plenty of Fish reported that his click rate has declined by 60% in the past two months. If the AdSense publishers aren’t making money, it means the AdSense program isn’t making money. Google AdSense accounts for 40% of Google’s revenue. It’ll be interesting to see how much that goes down by.
I guess what I said about not putting your eggs in Google’s basket is coming true.
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Google seems to be getting old nowadays, they are constantly trying to improve customer satisfaction and trying to get the maximum for the advertiser’s buck, but in the midst of this, something obviously went very wrong.
But…I do not use AdSense because I feel it is over used by too many people in the blogosphere. So it will not affect me, hopefully people don’t get too bugged out, there are literally thousands of other affiliate companies that will pay much more than Google!
Fabien
your right - google is getting old so many news about the good google and mroe about the bad google and how they did this and that - gosh google!
I too has left adsense! best move ever
I can only say that if Google does not watch itself carefully it may be heading for a stock market plunge in the next five years.
I guess Google has started to realise that Google is not god. I too dumped adsense and I felt proud of myself for doing that
Google has always been evil - it has made billions out of mistaken/fraudalent clicks on its ads.
Now it is going clean they are losing money hand over fist.
Fate it seems, is not without a sense of irony…
I dropped it a few weeks ago, because of all the changes… could be why GOOG is down 21% from its highs.
Kenneth
wow they are down that much? then again like john said, all these changes to improve user usability is really hampering everyone.
Googles in a jam? Could it be a pepperjam ?
Remember back in the day when you liked Google? I do! It’s been a while, but I used to get such a warm fuzzy feeling thinking of Google. The benevolent corporation who cared. Yeah right.
Google used to be focused on its users. Now, its focus is on its shareholders.
The “do no evil” mantra has long since passed by the wayside.
I couldn’t agree more. I wonder if they will ever fix some of their problems and get back to being the favorite among users.
It’s possible, but I would have the tendency to doubt it. All too frequently, once a company goes into the “corporate mindset” it is very rare that they ever come back from it, and typically not without a major change in leadership or ownership.
Umm no.
Before Google concentrated on its Affiliates.
Now it conecentrates on its Users.
The changes have resulted in a better experience for users, but the Affiliates are being hit hard.
Out in the real world the Goolge offering is better, but the people that helped Google grow to the empire they are are suffering - time for the backlash!
Indeed, and the fact that they seemed willing to let go of publishers such as Darren Rowse just like that only made matters worse.
Alan Johnson
To be fair, they have reversed their stance on that and are going to let anyone remain an affiliate, but they will only pay you for referrals that are from North America, Latin America, and Japan. It no longer matters where you live, it’s about where your referral is from.
It’s actually funny how a company with an army of consultants didn’t know better. This entire issue could have been avoided if they had chosen this approach in the first place, rather than making changes later on.
Alan Johnson
Hmmm
Google loosing money and cutting back to save money. Yahoo laying off 2000 employees.
Can you say bubble burst?
Indeed it does sound like a bubble burst. Tho Markus reporting 60% decrease on clicks is a huge difference (thats 60 clicks less from 100 he used to get).
But i bet the Advertisers that provide those Ads are paying less per click and getting better conversion rates.
The Advertiser of the Ads LOVE this change.
The web owner displaying the ads HATE this change.
Im on both sides of the fence and I have seen my monthly outgoings on adwords go down, but even though i get less clicks the signup rate has been higher.
As for my adsense earnings - i dont do much but I’ve seen a 30% decline in the last couple of months but luckily I only run adsense to fill a space no one will buy at the moment - im looking to swap it out as soon as i get a buyer.
Exactly, a lot of the changes which are not exactly popular with publishers are great news for advertisers, every company needs to find the right balance between keeping both advertisers and publishers happy and the folks over at G have not exactly done a great job lately.
Alan Johnson
The location selection surprises me, i live in Japan and have no idea why we are able to keep getting paid for referrals, maybe it’s because Yahoo is more popular here and Google are just trying to increase there presence.
I find that incredible that Plenty of Fish has seen a 60% decrease in CTR when I haven’t seen any decrease at all. Granted POF makes way more than I do, but I continue to earn about the same with the same amount of traffic.
Its the big earners that are suffering most because a lot of their clicks were generated by affectivly ‘tricking’ the user to click an ad when they didnt mean too. POF does that on just about every page. Now he is only getting puposful clicks revenues have gone down.
Im guessing you display your ads in banner or sidebar postions meaning your clicks were 99% puposeful to begin with. Hence you revenues have stayed constant.
POF is suffering - but he played a dangerous game with the google ads everywhere knowing full well he was getting mistaken clicks. He should have signed numerous advertising deals by now with legit companies and guarranteed his income a long time ago and not be lazy and rely on adsense. Times have changed and he hasn’t, time to pay the price.
On my best site my ads are in the content, but I’m not trying to trick anyone. POF was making a reported $10,000 per day so he should have a few months worth of revenue to live off of, wouldn’t you think?
I’ve seen huge CTR drops across all my sites since they made their change… the sad referral program just makes it even worse. I’m convinced that Google hates everyone and is just trying to see how far they can push.
It’s indeed incredible how a company with an army of consultants can make that many bad decisions, it just goes to show you that a huge budget isn’t everything
Alan Johnson
…disappointing..!
I own Korean blog but I live in America..
and I cant refer adsense anymore..
It is getting harder to make money from blogging.(esp in Korean)
man..should I start english one?
That’s a very astute observation about the clickable area affecting Google earnings down the road. Google may move to take a larger percentage of click revenue and share less with publishers in order to prop up their quarterly earnings.
None of these changes are good for publishers though and they are the reason Google makes as much money as it does.
Shaun, it’s a slippery slope for Google, the more they take, the less people will use Adsense. Hence revenue still drops. The reality is: Google’s goodwill is gone, spent, used up; and from now on, it’s jus another company with a sagging stock price.
Kenneth
Exactly, if they go too far with such changes, publishers will simply move on and, as such, G will end up making considerably less as a result of their approach.
Alan Johnson
Thing is - if click rates go down Google will be losig a lot of money.
What is to stop them moving a 50% cut up to 75% to save their own skin?
Well theres nothing to stop them doing that as they dont even publish what their cut is in the first place! Google will need to become more transparent if they want to gain some trust back from publishers.
Maybe they’re hiding in the shadows because the percentage is even higher than most people think and they know it would cause an outrage?
[...] And last but not least, John Chow writes in his recent post about Google’s raft of changes to its Adsense program: [...]
Poor Markus. According to a recent NY Times article, he pulled in $11 M advertising last year. At this rate, he’ll only make $6 M. Let’s all pass around the hat and help him out, will ya?
I think Google are getting a little greedy. It will be their downfall.
A lot of people predict the downfall of G on a regular basis but it seems that, no matter how controversial their decisions may be, they somehow manage to stay on top.
Alan Johnson
I’m kinda glad this is happening. More doors are opening for other ad companies to step up and provide a more profitable service.
Of course, that’s been said for quite a long time. I’ve had Adsense for I don’t remember how long now, and everytime Google has made a change, people (including myself on a few occasions) have spoken up and suggested it was a good time for other companies to step in and offer something better.
Yet, others still aren’t getting much traction in that regard.
One reason too may be that there aren’t really many destination sites anymore. It used to be that you’d go to one site (maybe Yahoo, maybe Google, maybe others) for just about everything.
But now you go to one site for search, another for news, another for this, another for that. I might search for something on Google, check news on Yahoo, skim for things of interest in digg, and then look up something in Wikipedia. There was a time, not too long ago, where I would do all that in Google.
There will be more opportunities, which is good, but the fractured system may result in less profitability as spending increases to try to grab viewers.
As long as google doesn’t kick in the ass of the users of other profitable ad services…
BTW we should find a Google PR alternative to make the game tight for Google.
Izea have launched something like that but at this point, it’s hard to imagine that it can compete with PR, but as far as the future is concerned, who knows what competitors may have up their sleeve
Alan Johnson
Lately, my Google income has increased. It will be interesting to see how I will be impacted by the change.
From $1 to $3
???
Nah, adsense isn’t dead and you can still make cash from it. But any publisher that starts to grow needs to swap it out quick as the adsense wont grow in proportion with traffic.
Just as John has done, swap adsense out and get monthly advertisers paying set prizes instead of being at the hands of google where incomes rely on your users actions and how much of a cut Google decide to take that day!
(I can just see them in their office now: Hmmm, profits are down 3% for the day, lets take 53% of ad revenue instead on 50% to make up for it - they’ll never know!)
Adsense is very useful manner for promotion, I understood more detail now.
Your talking about Adwords…Adsense is for publishers to display the ads
I have wasted a lot of time chasing Adsense for peanuts on my blogs - could living in Europe be the reason? After reading this, I am going to use the space for more potential income generators.
Enjoyed the article and the responses, thanks
AnneMarie
I don’t think so. You could be receiving a lot of your traffic from America anyway so I think it’s rather optimisation and drawing traffic to your website.
I am not sure if google affiliate is that good but many people seems to be not making much money from it.
[...] John Chow made a great posts today, he discusses how Google Adsense program might be failing. [...]
This just states that Google is not immune to recession. Google is a great company with great ideas but overall, it can’t beat the economic downturn. Especially, now with subprime loans, bonds, ..etc
* Bank of America just reported a 95% collapse in profits.
* Wachovia reported a 98% plunge.
* Yahoo is laying people off
Anyways, I read from NYT that there is still a need for high price items, like $1Million corvette and very very expensive stuffs. So the elite”rich” are still shopping and spending, expect the middle class is strapped!
John, you need to create a website for the A list people. How to spend a million dollar!
It’s an odd decision by Google when webmasters account for so much of their income. Adsense has been so poor lately I’ve been contemplating dropping it for some time; hitting the affiliates doesn’t seem smart either.
I wonder if this will have any impact in the uptake of Firefox…
Speaking of getting jerked by Google was I the only AdSense publisher that didn’t receive a cool Google gift this year? Usually Google sends publishers something nice. But I got a cheesy card.
It’s little changes like this that are reflecting the air of Google. I’ve been switched up my income strategy and focused more on lead generation offers when I saw my sites were being smart priced early in the year.
They just seem to care less about the folks that helped them get big which is us the publishers.
Honestly any time a company goes public, it becomes bad for the users and customers. It becomes all about making those numbers for the given quarter. Whereas when you’re private you don’t have shareholders to answer to. You have your customers to worry about.
I predict at this rate Google will have a nasty ring to it like Microsoft.
Google’s saving grace right now is that they still pretty much offer a lot of great free and useful services but the tide is definitely turning.
Considering the discontent of publishers, this is a perfect opportunity for yahoo or msn to sway publishers to their networks.
But they need a lot of work before that can happen.
Eddy Salomon
It’s rather unfortunate that not all can do away with Google. A small blog does better with PPC than affiliate marketing - there a very few worth-trying PPC programs outhere, so we stick to google…. for now.