The New York Time has an article which look at Google’s advertising system. Although the focus of the article leans more towards the advertisers side of things rather than publishers, it is still worth a read.
Here are some of the bits that I found interesting.
Because of this technology, users click ads 50 percent to 100 percent more often on Google than they do on Yahoo, Mr. Noto estimates, and that is a powerful driver of Google’s growth and profits. “Because the ads are more relevant,” he said, “they create a better return for advertisers, which causes them to spend more money, which gives Google better margins.” (Yahoo is working on its own technology to narrow that gap.)
This certainly seems to be true given what publishers are saying about YPN vs. AdSense. AdSense seems to have much better CTR than YPN, and relevancy seems to be a big part of it.
Here, as in other places, many advertisers criticize Google for being like a black box, because the company gives them less specific information and control than they would like.
Although I don’t follow the advertiser’s side of things as closely as I do the publishing side of things, this seems to reflect what publishers are feeling. The lack of information about what is happening in the advertising system can be frustrating. So far Google seems to take the approach that the system works, so there is no need to reveal any of the details.