The End of Adsense?

The results are in, and they ain’t pretty.

Market research firm Outsell released a report Wednesday that shows what many already knew — that click fraud in contextual pay per click advertising is a big problem. The report reveals that 14.6 percent of all clicks are bogus, and that 27 percent of advertisers reduced or stopped spending on click-based advertising.

That type of reaction is to be expected, and it’s reflected in Scott Karp’s post asking What Will Replace Pay-Per-Click Advertising? However, closer inspection shows that the majority of the fraud comes from third-party publisher sites, not in the actual search engines themselves, and that vindicates a pay per click model that actually works.

As I indicated in my recent pay per click advertising post, smart search engine marketers don’t bother with contextual advertising on third-party sites. Even without fraud it’s just not a good return on investment.

I’m not saying there is no fraud in the search engine result pages (SERPS) themselves, but it’s easy for Google to detect and discount that, and the motivation is lower. It’s a whole different story on independently-owned sites where a profit motive is present, thanks to AdSense.

AdSense has been a cash cow for Google for one simple reason — it caters to the “money for nothing” mentality that pervades the world of Internet publishing and marketing. You don’t have to sell anything or even add value to the Web… you just need that click.

So, once you have a program that rewards publishers for producing content and pages that effectively encourage people to leave as soon as possible, can we really be surprised that organized click fraud is the natural result? Did we think the millions of splogs and junk web pages littered with AdSense ads would be as bad as it got?

Nope. That’s not how this end game works, and I’m fairly sure Google had to be aware of this inevitable result.

However, pay per click advertising in search engines is still effective, and if the knee-jerk reaction from some advertisers is to abandon all PPC, better for the rest of us. Just understand that you can opt out of having your ads displayed on third party sites and still enjoy the ROI of search engine marketing.

But there is a definite shift afoot, and even Google’s smartly getting into it.

Affiliate marketing is making a strong comeback.

For many (such as myself), it never left. Unfortunately, the emphasis placed on AdSense, especially in the blogging world, has left many newcomers to Internet marketing completely in the dark about affiliate marketing techniques that work. And those techniques generally do not involve banner ads inserted in the spot where your AdSense used to be.

The fact is, you can make money with your blog (and other types of sites) if you’re willing to put some work into it, and invest a bit in learning smart strategies. Just don’t invest in any “make money with AdSense” programs at this point!