I like Jen’s Blog, it makes it so I can keep up with the entire AdSense program from one location - quite a time saver.

She has a very interesting post today which highlights some of the smart pricing issues:

Here is what that team member disclosed, as well as other tidbits already known about smart pricing.

• Smart pricing affects an entire account. It is not on a per page or per site basis.
• One poorly converting site can result in smart pricing impacting an entire account, even sites completely unrelated to the poorly converting one.
• Smart pricing is evaluated each week. So removing ads from sites you suspect are converting poorly could result in seeing an adjustment to a higher smart pricing percent in as little as a week.
• Smart pricing is tracked with a 30 day cookie, so you could be rewarded for new conversions that saw the initial click from your site up to 29 days earlier.
• Image ads are also affected by smart pricing.
• With smart pricing, an advertiser could end up paying less than their minimum bid, which would theoretically include the minimum bid price available, meaning publishers earn less for even the minimum valued clicks.
• Conversions for smart pricing publisher accounts are tracked by those advertisers who have opted into AdWords Conversion Tracking

As an advertiser, when I read this list, I like all the points quite a bit.

I found the point about the cookie quite interesting. I knew Google was coordinating some pricing data with conversion tracking.

However, this point makes me wonder if it would be cheaper for some advertisers who do a lot of contextual volume to use Google’s conversion tracking.

I suppose the experiment would be to take a site that has discontinued using contextual advertising due to horrible conversion rates and turn on the conversion tracking option. If the pricing went down, the conversions went up, or some combination in the middle, it would tell us a lot about how Google is leveraging conversion data to actually help advertisers pay appropriate amounts for contextual ads while possibly increasing the quality of the contextual network (if nothing converts, then the AdSense publisher gets paid less).

If anyone wants to conduct, or is in the middle of conducting an experiment like this, please let me know. I’d be interested in the results, and will help anyone set this up so the experiment is conducted properly (you might even get some free consulting out of the deal).

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