"We know now that advertising and e-commerce are both a key part of our business, and we’re going to try and build them simultaneously."
Jason Nazar, CEO, Docstoc
Removing AdSense ads reduces DocStoc’s revenue and fails to improve user engagement.
With 20 million registered users, Docstoc is the premier online destination for small businesses to get the help they need to start and manage their businesses. Docstoc was publicly launched in 2007, and initially relied only on Google AdSense to generate 90% of its revenue.
When Docstoc evolved its business to a subscription-based model complemented by advertising, some common questions arose: Should the company remove its advertising altogether? Would doing so improve user experience and prevent cannibalization of its rapidly growing e-commerce business?
To answer those questions, Docstoc founder and CEO Jason Nazar devised a simple — and powerful — test. For one day, the company took down every one of its AdSense ads, and closely monitored the results.
Removing ads strips revenue, doesn’t improve user engagement
Given DocStoc’s 20 million monthly visitors, removing every AdSense ad for 24 hours created a statistically significant test. And the results were clear.
"Not only did removing ads not affect the number of premium subscriptions we got that day at all," Jason says, "but it also did not meaningfully affect any of our user metrics: time on-site, average number of downloads or page views per visit."
In fact, the one change the company did experience was lost revenue. "We lost what would’ve netted out at millions of dollars a year," says Jason.
The company considered alternatives to AdSense, such as in-house ads or lead-generation products, but Jason says, "There’s nothing I know of that we could replace AdSense with that would drive as much revenue."
Ads complement e-commerce
Jason recommends that other publishers conduct similar tests to determine if their ads negatively affect user experience or conversions. "Testing AdSense and other products can help you understand user metrics, so you don’t make decisions based off opinions and conjecture and subjective whims," he says.
Jason adds that "there are a lot of things you can do with AdSense to drive more revenue that don’t have negative user impact … and even if you have opportunities like lead gen, e-commerce and subscription, you shouldn’t be taking off the ad products." Instead, he says, "you should be figuring out how advertising and e-commerce can live together in harmony, because you’ll make more money for it."
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