In order to improve ad relevancy, Google is making some changes in how Gmail ads appear. What should you know about the new improvements?
What are Ads in Gmail?
Gmail, Google’s free web-based email service, is part of the Google Display Network (formerly the Google Content Network). Historically, ads within Gmail have adhered to the traditional rules of the Display Network –ads appear against relevant content themes across the display network when an advertiser has selected the content theme as a part of a campaign. Per Google: Gmail ads are placed by Google computers using the same automated process that matches relevant AdWords ads to webpages and newsletters.
Recently however, Google has announced that, in order to improve the Gmail user experience, it is altering how ads are selected to appear within the Gmail environment. The goal, says Google, is to:
- Deliver fewer, but more relevant ads
- Increase in local offers, especially coupons
What Specifically is Changing?
Last summer, Google launched “Priority Inbox”, a Gmail feature which filters email bacn (email that is requested, but less important, such as a “Recipe of the Day” email or a favorite brand’s newsletter) to help users “get to the important stuff” more easily.
Moving forward, Google will begin to use some of the same signals it uses for Priority Inbox as part of its algorithm in determining which ads to serve within Google. Google has not announced which signals it will use. However, we can make some educated guesses, including:
- Keywords Which Spark Interest— Tied to email content and open-rates (if you open all of your emails about baseball, Google assumes you are very interested in baseball, and will serve more baseball-related ads)
- Message Archive History – Which emails you archive, delete and star, and their associated content informs Google about what content you are more or less interested in.
How Will This Change Impact My Campaign?
The change to how Google displays ads within Gmail will only affect advertisers running content or display campaigns. This change will not impact advertisers on the search network. In addition, there is nothing a marketer can do per se to affect this change (aside from opting out of Gmail altogether). Immediately and tangibly for marketers, we expect to see changes in campaign performance as follows:
- Fewer Impressions – For marketers using the display network as a vehicle to maximize their reach, they will see a decline in available ad impressions as fewer consumers deem their ads relevant.
- Improved Click-Through Rates – With the decline in low value impressions and a heightened focus on relevancy, we expect marketers using the Display network to see improved click-thru rates across their campaigns.
- Improved Quality Scores – As CTR improves, quality scores also improve over time. As such, we expect to see average quality scores across the display network to improve.
This may result in:
- Lower CPCs – As quality scores and the Google algorithm adjusts to the improved ad performance increase, some marketers may see a decline in their CPCs. Barring position shifts, CPCs may be reduced as position is maintained. However, fewer impressions may result in an increase in competition, meaning…
- Increased CPCs – As the universe of available impressions shrinks we expect to see an increase in competition for available impressions which may result in increased CPCs. However, we do not expect this to happen, as marketers will shift away from Gmail and into other, lower-cost content partners to ensure impression gains and lower costs.
We believe that these changes will have a positive impact for marketers and Gmail users; effectively minimizing wasted impressions from irrelevant messages improves both the marketers’ performance, as well the users’ experience. As ads become more relevant and more valuable to consumers, over time behavioral patterns change and consumers become more likely to rely on ad messaging and take action at higher rates than previously expected.
We applaud Google’s attempt at putting the user first and improving the user experience within the Gmail platform. We believe that putting consumer needs first was the original paradigm shift Google introduced and is a significant part of Google’s ongoing success. We also believe that this idea translates into improved marketer performance. All in all, we see the changes in Gmail ads as a positive for users and marketers alike.