Google AdSense, launched by Google Inc., is a program that allows publishers in the Google Network of content sites to serve automatic text, image, video and rich media adverts that are targeted to site content and audience. These adverts are administered, sorted, and maintained by Google. Magically, they can generate revenue on either a per-click or per-impression basis. In this passage, I would like to talk about how the targeting of Google AdSense works and how you can earns money as a publisher. First of all, you should get certificate to run AdSense advertisements. Actually, there are no strict criteria for acceptance into the AdSense program. It does not place minimum traffic requirements on applicants which unlike other ad networks. However, the only real criteria are “acceptable content” requirements. At the moment you have been accepted, you will be able to run AdSense advertisements on any site you own using the same ad code. The next step is to make the targeting of Google AdSense work. Google uses its search engine ranking technology to decide which ads to show on your site, and on specific pages of your site. For example, on a Webmaster site, an article about Flash might be accompanied by an ad for Macromedia products, while an article about Web hosting might show an ad from a hosting company. This type of targeting is very effective, and results in good click-through rates in most circumstances. However, this type of targeting isn’t perfect. One key issue with the system is that Google seems to be doing very little in the way of ad rotation. If a certain ad is highly targeted to your content, it might be shown every time. This means that if you attract a large number of return visitors, or generate a high number of page views per visitor, you may experience declining click-through rates on the ads over time. Another issue is that Google targets the ads based on your site’s content, not your visitor’s desires. The difference between the two might not be readily apparent, but it can have a significant impact on click through rates. For instance, I run a literature site that provides information on classic books and authors. Google will analyze my content and serve advertisements they see as being appropriate. For instance, on my Shakespeare page users may see ads for Shakespeare audio books or limited edition prints. The problem with this is that while those ads fit my content, they do not fit my visitors. Most of my visitors are students doing research and they simply aren’t interested in buying those types of products. In contrast, advertisements for essay or other homework assistance services do very well on that site. But unless an essay site owner specifically selects a keyword like “Shakespeare” in their AdWords account, visitors to my site will not see any essay advertisements. In pondering this situation I was reminded of a company called TeknoSurf Adwave, who eventually turned into Advertising.com. Their original claim to fame was that they were a CPC-only ad network. Yet they took the time to identify the banners that performed well on each site, and optimize the ads they served. This proved very successful – members enjoyed clickthrough rates high enough to generate an effective CPM. Indeed, the company’s figures were usually comparable to, or better than, the CPM rates offered by many other ad networks.
If Google could implement a similar system, it could greatly increase the effectiveness of their AdSense program. However, a hurdle to implementing this kind of system is that, currently, AdWords advertisers specifically select keywords under which they want ads to be served. For Google to implement TeknoSurf-style targeting, it would have to allow AdWords advertisers to opt into a program in which Google could place ads on the basis of what had been proven as the most effective keywords for that advertiser’s product. In this situation, if an advertiser served essay advertisements based on the “Shakespeare” keyword, and those ads did very well on my site, Google would remember this. The system would automatically compare the text of that ad to the text of other AdWords ads, it would run similar ads on my site, and it would track the results to see how they ads performed. In this way, Google would constantly be learning what types of ads performed well on members’ sites and what ads didn’t. After publishers had used the service for a while, the program would be able to serve ads that were tailored to publisher sites’ visitors, rather than their content. Thus, CTR rates would improve, both Google and the publishers would make more money, and the advertisers would attract more targeted traffic. Finally, you earn money as a publisher. But how much can you make? Actually, The amount of money you can make with Google AdSense depends entirely upon the niche your Website fills. For instance, a site about men’s health can make a killing on AdSense because of the high level of competition for related keywords. The CPC rates for competitive keywords can exceed $1, which translates directly to your site’s earning potential within the program. Of course, if you’re in a less competitive niche, you’ll make less money. Still, I haven’t seen anyone report earnings less than an effective $1 CPM, and the average seems to be more along the lines of $4-$5 CPM. Some people are making an effective CPM of $15 or more with this program. And all these figures reflect what the site owner receives after Google takes its commission. Commission is definitely one thing is that’s up in the air with AdSense. Google doesn’t publish the percentage it takes as a “cut”, and only displays the publisher’s cut in member reports. So far, comparisons of AdWords rates with AdSense earnings have produced commission estimates between 40% and 60%. Why Google refuses to publish its commission rates is unknown. It could be for legal reasons arising from the contracts the business has with premium distribution partners, or it could simply be that Google wants the ability to change rates without having to explicitly announce those changes. So far, most members report steady declines in earnings each day. This could be a result of the issues I mentioned above, including the lack of ad rotation. However, Google will likely implement changes to increase the program’s effectiveness in future, so this phenomenon is likely to be temporary. All in all, Google’s new program is good for publishers and the Internet advertising industry as a whole. Even if you choose not to run Google’s ads, the ripple effect of their introduction may mean higher rates for the ads you do choose to run.