Google bans 30,000 advertisers—and how this affects you

That represents 5.3% of their active advertiser base, which is about 570,000 advertisers strong. Despite that loss, their overall revenues were up 13% from Q3 to Q4 of last year, according to a new report released by AdGooroo.

The 4th quarter is typically strong because of the holiday shopping season, as gains from brick and mortar, plus “click and mortar” stores, more than offset the spammers that were banned.  The report noted that overall search volumes between November and December didn’t increase—thus, Google’s increased revenue came from more advertisers competing for those searches. Google now shows an average of 5.48 ads per search.  We don’t know the increase in average CPC, but we can assume it’s significant, given that revenue is up 13% in spite of banning folks. Note that a good chunk of those search results have zero search results, plus have map results showing.

In the last few months, we’ve seen a shift in online advertising, as local businesses are starting to not only get online with websites, but also begin advertising, whether doing it themselves or getting help from a local agency.

It’s no surprise that local advertisers can pay more—they are hyper-targeting customers in their neighborhood, as opposed to trying to compete nationwide.  If you’re Google, would you rather collect 50 cents per click from an advertiser promising miracle weight loss from their products or $5 a click from a local liposuction doctor who can actually deliver results?  Google is now financially rewarded for doing the right thing.  Spammers are driven out of the system by sheer economics, not just because of policy enforcements.

Consider this pest control company, paying $2 to $3 per click instead of a spammy 20 cents—and while they’re ridding homes of termites, ants, and roaches—they are also ridding the Internet of the other kinds of digital pests. Do you find that deliciously ironic?

We believe this local trend will become even stronger, as small businesses are learning how to build killer landing pages and optimize traffic. This increased conversion rate allows them to bid more for each click. The increase in the number of advertisers, whether directly or through agencies, demonstrates the enormous opportunity for you to get your small business online and with advertising from Google, Yahoo, Bing, and other engines.

If you’re not already advertising online or perhaps need a bit of help optimizing your campaigns to their potential, bookmark the ReadyTalk blog or check out one of the many free webinars that are available here on the site.

This is a guest post by Dennis Yu , CEO of BlitzLocal, a company specializing in helping local service firms get found on Google

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