Briefing

For years, cost per click (CPC) rates have been steadily rising.

The ongoing Department of Justice (DOJ) antitrust case against Google highlights some concerning practices that may be contributing to this trend. These are:

• Inflated prices – Google is allegedly manipulating ad auctions driving up prices, affecting advertisers and clients alike.
• Insincere practices – Google is allegedly misrepresenting how their Randomised Generalised Second-Price system works, causing confusion about auction quality improvements.
• Reduced visibility – Limits on search term visibility mean advertisers are potentially  paying more for less exposure, complicating the advertising landscape. 

So, how do we wrangle back a sense of control?

Understanding the changing landscape

It’s important to understand the implications of Google’s actions, which not only lead to rising CPC rates, but also raise concerns in the following areas:

• Trust issues – There’s a major concern about whether Google can be trusted as an advertising platform going forward, affecting advertisers’ confidence in their black box bidding models, campaigns and recommendations.
• Monopoly impact – Google is the biggest player in the Search game, until a bigger competitor emerges, we’re going to be “Googling it” for a while to come.
• Transparency advocacy – Without transparency and fairness in practice (or in the auction), creating a sustainable and ethical advertising ecosystem is tricky but fundamental.
  

Changes you can make today

To tackle these challenges and keep up with the changing ad scene, advertisers can:

• Diversify – Try using different marketing channels and spreading out media budget. Don’t rely only on Google Ads—check out other platforms too as part of a more robust marketing mix.
• Focus on your audiences – Leverage first-party data and Customer Match to strengthen Google’s Performance Max campaigns and potentially reduce CPCs through increased relevance.
• CPC limits – Utilise platform options like portfolio strategies to set maximum and minimum CPC bids while using smart bidding.

And there’s always manual CPC bidding too – if you have the time that is….