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Google’s recently announced change that paid search ads may be shown above the organic results (as they are now) and either to the right (also as they traditionally have been) or in some cases, below the organic listings, will have a major impact in four ways:
First, for each keyword, the ROAS (or whatever metric you use) can either increase (not likely), decrease (likely in some cases) or remain the same. So there will be immediate ROI impacts, and those SEM managers will need to develop strategies based around those changes. Will we see more advertisers spending more money to be in the results that appear above the organic listings? Only time will tell.
Second, this change could affect the Google Quality Score. Under the new plan, ads will now appear below the fold, and the consumer may never see them, so the result will be impressions without clicks. This means a lower click-through rate and possibly a lower quality score.
Third, if there is a run on the top positions (usually first to third, above the organic results), those click costs will be higher. While today you can have 8-10 advertisers sitting above the fold, all visible to the consumer without scrolling, that won’t be true when this change is implemented.
And fourth, now every search term needs to be tracked and analyzed based on where it actually appeared. Search managers and developers of tracking software will now have to make changes in order to effectively track and report on this change, and analysts and managers will need to develop strategies based on ads having less visibility.
In summation, this is clearly a major change, one likely to impact every advertiser. An unintended consequence is that this move might favor advertisers with deep pockets who can afford to pay for positions above the organic listings. It will be interesting to see how this plays out.