Changing CPC to CPM in AdSense. How to increase CPM bids?

The creators of AdSense have introduced a major change in the way earnings are settled for publishers. Since February 1st, 2024 earnings have been depending on CPM, that is the number of ad views (CPM model). It is a significant change in comparison to the previous settlement method based on ad clicks (CPC model).

I had an opportunity to test a new method of settlement inside out. I have decided to share some information concerning bids we can currently count on. What is more, I am going to show you how to increase earnings despite the change of settlement method from CPC to CPM.

What is AdSense and how does it work?

Before we delve into some changes in the program, I am going to try to explain what AdSense is. Well, the AdSense Program has been present on the market for over 20 years. It allows publishers to earn money in exchange for sharing adverts on their websites.
Up to now, publishers who have used the program actively have earned money for clicks on ads on their websites. In October 2023 Google announced some changes in the way of paying for advertising. The new method of payment is consistent with current technologies and market trends.

How many bid types are there in AdSense?

CPC bids

CPC (i.e. Cost Per Click) – it is the amount of money you earn from each one-time ad click. The cost of one click depends on advertisers and the amount of money they are willing to pay for such a click.

CPM bids

CPM (i.e. Cost Per Mille) – it is the cost of 1000 ad views. As far as the CPM model of bids settlement is concerned, an ad auction determines the cost of 1000 views of a given advert. Then, a publisher gets money for each view.

CPM in an active view

CPM (Cost Per Mille) in an active view – similarly to the previous model, CPM in an active view is the cost of 1000 views of a given advert. The difference is that here, each view must be considered as visible. It is so when at least 50% of an ad is viewed for at least 1 second.

CPE bids

CPE (Cost Per Engagement) – Ad providers pay publishers only when the user engages in a viewed advert. Engagement in adverts can be, for example, a situation when the user holds a cursor on a given ad for some time – similarly to the lightbox adverts. These are ads that can expand to big sizes when you hover over them.

Unbillable

Unbillable adverts include all the ads that cannot be monetized, e.g. selected charity ads. Free promotion is also connected with an unusual way of settlement which may include direct sales.

AdSense changes from CPC to CPM – Will earnings decrease or increase?

I have been analyzing various reports of a new earning method since February 1st 2024. Since October 2023 Google has been informing about upcoming major changes. Thanks to that, we were able to prepare for these changes. After the introduction of the CPM settlement method, I noticed plenty of entries on forums concerning earnings decrease. You need to know that it doesn’t have to be this way. All you have to do is to optimize adverts properly!

Why did AdSense change from CPC to CPM?

The AdSense Program has been operating based on the CPC model for many years. To meet the expectations of publishers, Google decided to change the settlement method to the one that is based on the CPM model. This major change was introduced due to an attempt to standardize the way of paying for advertising space not only on the Google platform but also on external platforms.

New payment standard in AdSense

Currently, publishers have a wide range of earning opportunities using direct sales, advertising networks as well and platforms to use their advertising space, e.g. using Ad Server or Ad Manager. The update of the settlement method was dictated by differences of payments in various technologies. The CPM model aims at increasing the transparency of the money earned by publishers.

Comments from the web – what did other publishers notice after the change from CPC to CPM?

In the morning, have 100% CPM bids. CTR down.

I think my account is transfered do 100% CPM bids. Not see any CPC bids now. All is CPM.

100% CPM for me too. Looks like todays the day.

Same here, 100% CPM Bids but a decent Impression RPM.

Same for me 99% CPM, not significant decreases in rpm, as expected when everybody gets CPM it evens out..

CPM 98 % so a good sign

94% CPM bids and the rpm for it is lower than CPC. Looks like the fall of Adsense has officially started today.

CPM is today 100% and the numbers are quite good today…

CPM bids 100% here, but funny how when I calculate the clicks x CPC, I get the same amount of revenue earned by CPM Bids today, coincidence or one still has something to do with the other?

Okay my revenue is rising today. Maybe the 100% CPM won’t be that bad?

As I mentioned earlier, going through forums concerning AdSense I have noticed some entries of the publishers who lost money because of the CPM model. Interestingly, there have been some other posts of the publishers who profited from the change.

Examples of publishers’ opinions on the settlement change

Although Google informed that the new CPM model would not change the amount of earnings, at the moment the publishers’ opinions are divided. Some of them simply were lucky enough and noticed earnings increase whereas the others complained about earnings decrease due to a new system.

How was it before?

Before February 1st, 2024 publishers using the AdSense Program had been earning money with the use of the CPC model. Proper optimization of the ad layout could work miracles and increase earnings even several times. The program participants had been earning money for each ad click, which is why, the optimal layout as well as the choice of adverts had been the most important. As it turns out the ad layout is equally crucial in the new earning system.

How is it now?

On February 1st, 2024 Google AdSense introduced major changes to the CPM model settlement system. Publishers get money for each ad view. Has the update been good for publishers? It turns out that there are various opinions on the subject matter. On forums concerning the AdSense Program thoughts are divided and, unfortunately, half of the publishers report considerate earnings decrease. Luckily, there is a solution.

Earnings increase with CPM in AdSense

To meet the expectations of my readers, I have decided to point out and explain the most important aspects in the new CPM model. I have been observing the new settlement method for a few months now and I can optimize adverts in such a way as to increase your earnings considerably.

How to increase earnings with AdSense?

• Optimization and configuration of the AdSense panel. It turns out that some of the seemingly tiny checkboxes in the AdSense panel have a big impact on your earnings. Each option set in the AdSense panel must be analyzed and tested.
• Grid optimization of the ad layout. In the new CPM model, all the publishers are required to optimize the ad layout on their websites. Currently, the placement of the adverts in a domain is crucial due to the strategic places where the users are. Thanks to my analysis, I managed to determine how you can increase your earnings in the CPM model. In order to start earning money from a certain ad, it has to be viewed for a specific period of time – it is at least 1.3 seconds. Therefore, it’s worth optimizing the ad layout on the website since it will increase your earnings significantly because of the way the CPM model now operates.
• Conducting A/B tests. The changes in the AdSense panel as well as in the ad layout are not enough. Conducting A/B tests in AdSense is a crucial part of the ad optimization. It allows publishers to understand the users’ behavior better and maximize advertising revenue.
• Proprietary analysis tools. I am in possession of a proprietary analysis tool that carefully examines where and how much a user spends. Thanks to this tool, I can develop the ad layout on the website to improve your earnings. Your website does not have to be filled with unnecessary and distracting advertisements.

Summary

Unfortunately, I am not able to provide you with all my knowledge concerning the new CPM settlement method in the Google AdSense Program in one article. If you need some help connecting with this new model, please contact me. I will be happy to analyze your case and optimize all the ads on your website to increase your earnings with AdSense, which works based on the CPM model.