Basics · also called niche, category
Vertical
A vertical is a subject area or industry, such as insurance, travel or home improvement, that a set of ads and keywords belongs to.
A vertical is a topic category. Finance, health, automotive, education, legal services and home improvement are all verticals. Inside each sit narrower niches: within automotive there are car insurance, used SUVs, tyres and electric vehicles.
Arbitrageurs think in verticals because each one behaves differently. Advertiser demand, and therefore RPC, differs widely. So does the cost and availability of traffic, the season when demand peaks (seasonality), and the level of regulatory risk.
Some verticals are tightly controlled. Topics such as healthcare, financial products, gambling and employment come with extra rules on the traffic platforms and the feeds, and may need certification or be barred outright. These are called a restricted vertical. Feed policies also prohibit suggested search terms that target people by sensitive personal attributes.
Spreading activity across several verticals reduces concentration risk. A buyer who earns everything from one niche can lose the whole business if one large advertiser in that niche stops bidding.
An example
Say a buyer runs three verticals. Home services earns $0.60 per feed click, travel $0.25 and recipes $0.05. The buyer can afford to pay roughly ten times more for a home-services visitor than for a recipe reader.
Related terms
Keyword
A keyword is the word or phrase that triggers search ads, either typed by a person or passed to the search feed by a web page.
Commercial intent
Commercial intent is how likely a search or click is to come from someone ready to spend money.
Restricted vertical
A restricted vertical is a topic area, such as gambling, adult content, drugs or certain financial and health offers, where ads are limited, need permission or are banned.
Seasonality
Seasonality is the predictable rise and fall of traffic costs, advertiser bids and user interest at different times of the year, month or week.
Concentration risk
Concentration risk is the danger of depending too heavily on one feed, one traffic source, one keyword group or one account, so a single failure hurts the whole business.
Sources: Google AdSense Help: AFS Product-Integrated Feature policies