Google Advertising – Part I
What is Adsense and where did it come from?
Google advertising represents a massive slice of the Internet’s global revenue base; the AdSense Software contributes a large percentage to Google’s annual multi-billion dollar turnover.
There was real confusion in the early days of the internet as to how a search engine, or other business, would sensibly make money from (“monetize”) traffic and, particularly, allow third party advertisers of a range of sizes to get their ads onto the web and for others to make money from displaying them. The real genius of AdSense was to link the advertisers and the advertising ‘hosts’ (websites displaying AdSense adverts), using its amazing Google search engine as the platform to pull both sides together. Google advertising was born.
In one relatively simple (in hindsight!) step, Google completely revolutionized the ad market on the internet and gave substance to the “click-through” advertising market. It was bold and innovative. It was the start of a multi-billion dollar cash cow. A revolution 
How Does it Work?
Users sign up their websites for affiliation with Google. When approved, every site which displays AdSense ads is given special code to place targeted adverts on the website. The adverts are specifically targeted to the CONTENT of the website. Crucial to Google’s model of delivering relevance.
As well as delivering real relevance, the holy grail for every internet user, this approach saved Google from the hassle, web page space and administration associated with managing banner adverts. Sweet, indeed.
In its absolute essence, AdSense is a software program by virtue of which Google will pay you for targeting/directing the users of your website to another website. Advertising in its simplest, neatest, sense.
- A “click through” occurs when a visitor clicks on a hyperlink which links to an advert.
- The AdSense code used by Google now offers those who display AdSense code an assortment of methods of displaying ads: from text links to graphic links, banner ads to video ads (each having a hyperlink in-built automatically by the AdSense code).
- Those who display AdSense put these ‘boxes’ in appropriate places on their websites. They get clicked. Click = cash for the site owner displaying the relevant, useful ads. Win, win.
But How Does This Link to AdWords?
What determines the amount paid by the AdWords advertiser is how much the AdWords advertiser is prepared to pay for each click. The more you pay, the better placed the ads, the more often they’ll be displayed, the more clicks…you get it! There’s real competition for ‘hot’ keywords.
There is a correlation between how much an AdWords advertiser has paid to display their ad and how much an AdSense click delivers. AdWords advertisers can pay a few cents per click right up to $10 or more. You can see, therefore, that the displayer of AdSense can take a ‘slice’ of an expensive ad or a relatively cheap one and the more traffic you receive will increase the possibility of a click and a click through fee into the AdSense account.
We’ll come back to this soon. Enjoy experimenting.
Filed under: Advertising, Google | Tagged: google advertising
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When it comes to advertising, the click through rate (CTR) is the most important thing. Go figure, if your ads is showing up over thousand of time, but have only a few click through rate? Yeah, it’s totally suck if this happened on us!
It’s true, Adsense and Adwords are awesome and brilliant. I’ve only started to get into both of them recently.
Adwords traffic is more expensive per click than other networks, but I’ve found that it does seem to be much better quality. I don’t really know why that is.
There does seem to be a bit of an art to it all. That’s what makes it so fascinating …
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