Sunday, 20 May 2007

Who's gonna cry when the MFA bonanza ends?

Not so long ago it was common to search Google and find pay-per-click ads in the results pointing to sites with nothing but more ads. You would search for something like 'Ohio insurance' and find a number of results with ads such as

Top sites on Ohio insurance
See top web results
on Ohio insurance!

You would click through to a site filled with little but more Google ads - with numerous Adsense blocks throughout. The sites were usually optimised for maximum click-through on ads.

A case of arbitrage - webmasters tried to find cheap terms to advertise on and then have advertisements, which pay more on their own website. While this worked, and it did for a long time, there were apparently people out there making as much as tens of thousand dollars per month (UPS Club, anyone?).

But like with any untapped opportunity, the news spread and ranks of arbitrage and made-for-adsense (MFA) webmasters swelled. Automated software appeared to simplify the task of finding 'untapped niches'. Webmasters would find various ways to obtain cheap traffic (Adwords, organic, other cpc ad systems) and turn into into more expensive traffic by displaying higher quality ads.

What were the effects?
1. for Google, the additional ad-clicking meant the appearance of extra revenue, but not extra profit, since this was simply a transfer from some its advertisers to some of its publishers. In fact, MFA arbitrageurs were taking away money that could have been Google's profit,
2. for regular advertisers an increase in cost and decrease in effectiveness (conversion rates, ROI) of their ads on Google Adwords, likely pushing a segment of potential advertisers outside of the network completely,
3. for clever MFA webmasters, often huge profits with a small initial time investment,
4. for the searcher a decrease in quality of the search engine results pages (SERPs) - they click on ads, which rather than showing the expected content show more ads.

There were calls from the advertiser and searcher communities for Google to stop this practice. In the long term, by souring the quality of results (especially in the content network - ads published on people's blogs and other sites) the MFS arbitrage was probably hurting Google itself. Many CPC experts recommended that advertisers opt out of the content network (ads displayed on sites of publishers outside of Google itself)

According to Andy Beal at, self-admitted MFA webmasters at WebmasterWorld have been discussing notices they received from Google that their Adsense accounts will be suspended as of June 1, 2007. Google apparently deemed their business model unfit (albeit after tolerating it for years).

And for MFA webmasters out there - lucky you, if you have made enough this way to make getting into a new business model easy, start learning about defensible traffic now. Also, there must be a market for your skills in writing those high click-through adwords ads and placing the adsense boxes just right.