For those who run pay per click (PPC) ad campaigns with Google, this week has delivered is a bit of a watershed moment. Because Google has confirmed that it’s PPC display system is being altered. The sidebar is going (and all the sidebar ads in it) and Google is making space for four adverts above the organic search results instead of three.

One reason behind this is the increasing use of mobile for search, on which side bar ads don’t show anyway.

Now I’m someone who spent, with my previous business, six years paying Google thousands of pounds per month and getting 50 per cent of my leads though PPC ads. Sometimes I’d take an aggressive stance, up my bids for key keywords, and appear right at the top of the PPC results (shown with the word ‘ad’ alongside them).

On other occasions, I’d bid more moderately and happily take a sidebar position. As a small business owner, PPC enabled me to enter the market at a low cost per click and build my business until it became one of the leaders in that particular niche.

I know that right now across the world there will be plenty of small business owners feeling totally FREAKED out about the possibility of not being able to show in the sidebar anymore. It’s still early days to really see how this unfolds but this is my initial take on it.

1. Advertising costs must surely go up, and immediately. Ad spaces have just got more competitive and natural market and competitive forces will see prices go up. Reduced ad space forces everyone to stake their highest price from the off, and go right up against the big guns. Beforehand, you could get your services listed in the ads by stating a price that you hoped would get you results, yet at a level that didn’t make you  feel like you were financially crippling yourself, because you were bidding for one of 10 slots. You could tell yourself ‘Fine, let the big guns bid for the 1st 3 positions, I’ll go for position 4 or 5’ and then use the money you earned fro the leads to increase your bid in a way that fitted with your growing business revenue. This was a part of the global democratisation of business that the internet gave. If I’m Mrs Local Dog Biscuit Maker, my ad could show right there along Big Brand Dog Biscuits  just a few positions below. That was a wonderful thing. Now however, it’s not a question of entering at a price that feels comfortable and starting off at a low price and steadily increasing your bid as Google brings you more business. You will have to enter the market right up against whoever the big guns are in your niche. They might be willing to spend thousands per month on adwords, as I did. For a small or new business owner, competing well be impossible.
2. Advertisers will have to be even more selective about determining which keywords to bid higher for, and possibly abandon the obvious keywords for clever ones. For instance, I have a client who sells cycle panniers. As a new business, if only the top four positions are showing, it’s unlikely he can compete on obvious searches such as ‘Cycle pannier’. Because these top ad spots are held by big brands such as Evans and Halfords with huge PPC budgets. But perhaps there is still opportunity on long tail keywords, such as ‘waterproof panniers for commuting.’ Ok, so he may get less leads, but trying to see a silver lining, the search traffic is even more targeted that it is simple for ‘bike panniers’.
3. This also affects organic listings. Just like that, Google has seized another position at the top of the page. And with their knowledge graph also taking a spot above organic listings, even the number 1 listing is pushed further down, and those below might start feeling as though they are on page two. Look at this example from Twitter where Raj Nijjer of Yext shows zero organic listings appearing above the fold!! OK so not every keyword has a knowledge graph definition in place (yet) and of course SEO, first page and long tail rankings are still relevant BUT paid search is most definitely now the primary way to be seen on Google.
4. It could be however that Google reverse this decision. The thing is, as a business, would you prefer to have a load of businesses of all sizes paying across all price points for your services as was the case, or just big businesses paying big prices? Both are valid strategies. If small businesses drop out of PPC or don’t both entering the PPC market at all, then Google may see a drop in income and reconsider. They have themselves apparently stated this is not yet set in stone.
5. Plenty of people are already hooked on FB ads, finding them much cheaper. Will this see even more of a shift to FB advertising?

Where will it all end? That we don’t know yet. This isn’t too dissimilar to when Facebook’s algorithm shifted a few years ago, and the immediate reach of Facebook pages dropped from 100 per cent of likes to 10 per cent of likes. I find this decision by Google pretty shocking, even though I no longer spend with Google having sold the business that I had.

I had a good experience with Adwords between 2008 and 2014 and I would always think of PPC as a great route to market and one that anyone can participate in. This reminds us that ultimately, we rely on these tech giants such as Facebook and Google for visibility for our businesses, but they are so dominant that really we are just pawns in their game. They can change the rules at any time. As businesses themselves, they will take strategies that bring in the most revenue for them and the rest of us sink or swim and ultimately just have to go along with it.