Google Adsense can be annoying if you’re a publisher at times. One of the most consistently frustrating things is when you do your job and “get more traffic”, but the new traffic is monetized at a lower rate than you expected. In essence, you get paid less for more traffic and you can’t help wondering what happened to the money.

Lower revenue – Conspiracy or fact of the advertising business?

Let’s look at both sides of the coin. On the one hand, we have the conspiracy idea. Since Google has a “blind payout” and they aren’t required to explain how much you get on each click, they might just keep more money for themselves, depending on what earnings targets they set for the quarter. The idea is certainly plausible. But the trouble with all conspiracies, including this one, is that it’s a negative thought to have, and it’s not necessarily true.

So that leaves us to think of some other possible reasons. Supply and demand is one of them. Since you now have more visitors, your supply is up. This might push the cost of advertising down as people purchase more visitors from your website.

Another possibility is that SmartPricing has kicked in as new visitors to your website are assimilated and the conversion rates are taken into account. This also could be true, based on how the system works. Again, it happens in the background, unknown to you.

In the end, it really doesn’t matter what theory you adopt. It’s still your job to get out there and get even more traffic, and to monetize it any way you deem possible. If you keep on doing the job, the numbers should take care of themselves in the end.