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Google Increasingly Showing Four Text Ads Above the Organic Results on Phones

Almost exactly a year after they began increasingly showing three paid links above the organic results on phones where there used to be only two, Google appears to have further expanded its paid search inventory on phones with the addition of a fourth text ad at the top of the page for a greater share of searches.

The share of non-brand phone text ad traffic coming from ads featured in the fourth position began rising considerably at the end of June, and daily share is now regularly over 3% after coming in at lower than 0.25% for the first few weeks of June.

While Morgan Stanley observed the fourth text ad primarily for travel and finance advertisers, our brands are primarily retail and are also seeing it.

In turn, phone share of non-brand text ad traffic has also increased:

As there are now more text ad positions available on the page, first page and top of page minimum bids provided by Google have fallen since the increased rollout of the fourth text ad.

Google Appears to Have Made Multiple Changes at the End of June

These trends coincide with a rise in brand text ad CPC on phones for many advertisers.

While the addition of a fourth text ad likely has nothing to do with this CPC increase, the additional ad does appear to have impacted brand average first page and top of page minimum bids, which also fell over the same time frame as non-brand.

Thus, it appears Google has quietly rolled out changes which are impacting both brand and non-brand performance on phones, though the cause of the increase in brand CPC is still a mystery.

Outlook

The fourth text ad was not formally announced by Google, much in the same way that the third text ad was not confirmed last year until a Search Engine Land column of mine exposed the apparent impact.

While the addition of a fourth text ad isn’t likely to drive the kind of massive growth observed on phones following the addition of the third text ad, we are already seeing a rise in non-brand text ad share attributed to phones, and it’s unclear if the fourth text ad has been rolled out to as many searches as will end up featuring them.

As organic links get pushed further down the page, organic visits will likely suffer, much in the same way they have over the past twelve months with the addition of the third text ad. In Q1 of this year, mobile organic visits declined 1% Y/Y compared to 63% Y/Y growth in Q1 2015.

Thus, marketers should expect increased mobile paid search growth over the next few quarters with a corresponding decline in organic visit growth.

Conclusion

It’s becoming increasingly common for Google to roll out fairly significant SERP changes silently, and marketers must be on the lookout in their own data for signs of change.

In the case of the fourth text ad, there’s not much advertisers can do except to brace for additional paid search traffic from phones and fewer organic phone visits.

For rising brand CPCs, advertisers can attempt to prevent their own CPCs from going up by lowering bids.

As always, stay tuned to our blog for more analysis on these and other trends impacting search performance.

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