Google Adsense Reporting is Deceptive For Publishers

July 24th, 2006

When looking at Google Adsense reports recently I noticed that the eCPM column is actually Page eCPM. No big deal right?

Well, it is a big deal.

Web publishers commonly use eCPM to compare performance between different advertising networks or advertisers. If a web publisher is working with Adsense, Yahoo Publisher Network, RMX Direct networks, Valueclick, Tribal Fusion, Burst, or some other ad network, one large factor in their decision is what eCPM that network is paying them. All those networks, as well as the hundreds of others that exist report to publishers on an eCPM basis, which is really how much a publisher gets paid per 1000 ad impressions. A single page view can have multiple ad impressions on it depending on how many ad units are on that page.

Google on the other hand is reporting Page eCPM, which is an inflated CPM value in comparison to what the rest of advertising world uses. It’s the money the publisher earns per page, opposed to each ad unit.

On the surface, there’s nothing wrong with Google choosing to report like that, but when you consider that every other network is reporting with a standard eCPM per ad unit, you wonder why Google does it differently.

The answer is because it’s a higher number. If a publisher has two ad units on a page, the Page eCPM as reported by Google will be double the actual eCPM. If they have three ad units, it could be three times larger. The more ad units you stick on the page, the larger the Page eCPM will be.

So why does it matter that Google reports a number that is made to look higher? The answer can be illustrated with the following example:

A publisher runs two ad units on their page and works with Google and Yahoo Publisher Network. They are trying to determine which network to send more inventory to, so they want to do a comparison. They look at their Yahoo Publisher Network results and they see that they’re making a $0.50 eCPM. Then they go to Adsense reporting and look quickly at the default report and see a $0.90 eCPM, and determine that Googie is paying them more so they send more inventory to Google.

Unfortunately for the publisher, they just misallocated that inventory as Yahoo is actually earning them more than Google because they really had a $0.90 Page eCPM with Adsense. Both ad units are contributing towards that eCPM total, while Yahoo is just reporting their eCPM for a single ad unit.
Now, you can find the actual Ad Unit eCPM in Adsense reporting if you do some customization, but it’s definitely not something they put out there that obviously.

The only benefit for using Page eCPM is for Google. When publishers are used to normal eCPM reporting and Page eCPM can easily be skewed up and down by just adding and removing ad units from a page. It’s helping Google get ad inventory it isn’t winning in reality. That’s deceptive when there is no real benefit for publishers to report Page eCPM, at least as the primary statistic.

A smart publisher will say “No big deal, I just look at my actual revenue”. This is great, but I’d guess a majority of publishers just look at the CPM numbers when comparing ad networks for performance and deciding where to allocate inventory. Revenue is also hard to compare when you can send more volume to one network than the other.

As Google themselves say in their Adsense Glossary: “From a publisher’s perspective, CPM is a useful way to compare revenue across different channels and advertising programs.”

It sure is Google! So how about deciding to stop deceiving publishers with reporting the subtle Page eCPM?

Related Posts:

• Google Adsense: ‘Advertise on this site’
• Ask.com Is Launching a Contextual Search Network
• Is Google’s CPA Network a Big Deal?
• Miva to Launch Contextual Network
• Oops, Nielsen Miscounted Myspace Impressions

Entry Filed under: Ad Networks, Advertising, Direct Media Exchange, Google, Random, Yahoo