1) Is it site-wide, or is it channel dependent? In other words, I have a site with 3 different channels – Between the 3 the average is generally above 3%, but not always. However, I still get high paying clicks on the best channel. Does Google fine-tune it like that?

2) I’ve seen a couple of my sites go as low as 1% for a day, then bounce up to 5-15% the next. How does that much variation affect smart-pricing?

@ Robert, Good deal! Hopefully your earnings start to increase now.

I couldn’t figure out what the heck was going on until I read your article. I am definatly going to pull them off those blogs and see if my earnings go back up.
Thanks Again!!!!

leaving aside the fact there may be a strong correlation. It is ‘conversion’ that affects whether you are smart priced or not rather than the CTR according to Google.

(As of today it still says so in their official adwords learning center quiz).. :-

http://www.google.com/adwords/learningcenter/text/breeze_quizzes/quiz-64888.html

Thanks for the link, I’ll check it out.

Of course it all comes down to the advertisers conversion rate because that’s what it’s all about. But, I’d imagine, as you said, there is a high correlation between the two.

If ads aren’t converting, Google assumes that’s because it isn’t targeted. If it isn’t targeted then even those who close aren’t going to follow-through. If the CTR is high then it’s most likely extremely targeted, meaning there is a good chance that those who click will convert into buyers.

That’s just my thinking though and I have no idea if that’s how Google thinks. I’d imagine it’s close though.

I’ll be looking for your post.

I read the article by Court as well and I’ve looked into it for an upcoming post (next few days). It seems smart pricing has been around for a couple of years, but there’s very little official info on it.

You might want to check out The Facts About Smart Pricing from Google’s official Adsense Blog. It’s more than two years old and contradicts Court – they say it’s not about CTR, its about advertiser conversion rate. Of course there is probably a high correlation between high CTR and high advertiser conversion rate because both are a product of targeted traffic. Of course they might have changed how it works…

Anyway, my CTR is horrible on my blog, for all the reasons I gave in my recent post… I’m going to keep Adsense for the time being, but now I’m only showing it to the search traffic. How I did this (I hacked the Shylock Adsense plugin, but you can use Who Sees Ads as well) will be in my upcoming post.

I’m really getting into this Adsense stuff lately, as you can probably tell!