For those not in the know, a Google slap is when Google dramatically raises the cost per click of all your keywords, essentially destroying your PPC campaign.  For example, let’s say you put up a website about golf, and embedded it with affiliate links to golf products.  You use one of the site’s pages as a landing page (where the visitor is taken to after he clicks the AdWords ad link).  You have great content, and the visitor clicks your affiliate link for a set of golf clubs and buys it.  Your commission is $30.00, but the cost of the click was $5.00 for the keyword “golf clubs” due to the Google slap, and 49 other people clicked it before that one person actually purchased something.  So your profit is $30 – $250 (50 x $5) = -$220.

Affiliate sites are easy to identify.  Most of them are there to generate referrals, so they are embedded with links coded with affiliate IDs.  So Google is targeting them and is making it difficult if not impossible for these site owners to continue doing business through PPC.  And, it doesn’t matter how good your campaign is set up:  the word is that the best laid out AdWords ads (great landing pages, highly researched keyword lists containing only the highly converting words, high page rank landing pages) are getting slapped with unsustainable keyword bids.

Google is making a statement that it is not interested in having a bunch of affiliate marketing sites dominate its pay per click network.  This is amazing, because I’m sure Google gets tens of millions of dollars a month in PPC fees from affiliate marketers.  But the Big G is looking out for its reputation and long term growth.  It believes that if the user experience is trashy, it will lose money in the long run as people abandon using it.

I have said for some time that PPC marketing in most cases is a big waste of money.  This event proves it further.  You have to be crazy to think you can outwit Google.

Even though I’m not a big PPC marketing fan, I’m still worried about this news.    If Google doesn’t like affiliate sites in its PPC network, then what about its organic listings?  If the same “penalty” is applied to all indexed sites, there’s a good chance that affiliate sites may drop off the face of the Google earth in search results.  If this happens, it could devastate affiliate marketing.  The only other option is to have a large email list of prospects, and market to them directly, sending them content embedded with your affiliate links.

My advice is to not rely on one internet marketing business model.  Diversify; consider returning to the basics and investing in a “niche” ecommerce website.