Before signing up to AdSense, it’s important to understand what you’re sign ing up to. Many of the principles an d strategies th at I describe in this book make the most of the way that AdSen se works. If you can understand where AdSense are getting their ads, how they assign those ads to Web pages and how they fix the prices for clicks on t hose ads or for ad appearances on those pages, you’ll be in a great position to
manipulate AdSense in a way that gives you maximum revenues.Unfortunately, I can’t really do th at. Much of the way th at Google runs the AdSense program is kept u nder wraps.I kn ow a few things — and enough to do a great deal with our AdSense ads.But I don’t know it all. No one ou tside Google does. And for good reason. If it was clear how Google figured out the content of each website and which ads suit th at site best, th ere’s a good chance that the Web would be filled with sites created specially to bring in the highest paying ads instead of sites built to brin g in and in form u sers.People do try to build sites for ads not content, but they tend to make less mon ey than high qualit y sites t hat attract loyal users who click on ads.The fact is, we can make the most of both AdSense an d our own ad space without knowing the algorithms that Google uses to assign ads and pay sites.That’s becau se AdSense is pretty simple. At the most basic level,AdSense is a service run by Google that places ads on websites. Wh en you sign up to AdSense, you agree to take the ads that Google gives you and receive a fee each time a user clicks on that ad (or for each thousand ad appearances the ad receives on your site, depending on the type of ad).The ads themselves come from another Google service: AdWords.If you want to understand AdSense, you will need to understand AdWords.Advertisers submit their ads to Google using the AdWords program. They write a headline and a short piece of text — and here’s wh ere it gets interesting — they choose how much they want to pay.Advertisers decide on t he size of their advertising budgets and the amount th ey’re prepared to pay for each click they receive. Google then decides
where to put those ads.So a company that has a website selling handmade furniture might create and that looks like this:
The company’s owner might then say that he’s prepared to pay $1000 a month for his advertising budget but not more than $1 for a click. He can be certain now of getting at least a thousand leads a month.But that’s where his control over the ad ends. Google will figure out which sites suit an ad like that and pu t them where it sees fit, charging the advertiser up to a dollar a click until the advertiser’s budget runs out. (Of
th at dollar, how much the publisher receives is a Google secret. Th e New York Times has reported Google pays publishers 7 8.5 percent of the advertising price per click. The figure hasn’t been confirmed bu t it is around what most people in the industry expect that Google pays.) That makes AdWords different to more traditional form of advertising. In the print world, an advertiser chooses where it wants to place its ads and decides if the price is worth paying.The newspaper too decides how much it wants advertisers to pay to appear on its pages. Any advertiser that meets that price gets the slot and the publisher always knows how much his space is worth. Neither of th se t ings is true online.When an advertiser signs up to AdWords, he has no idea where his ads are goin g to turn up. When you sign up to AdSense, you’ve got no idea how much you’re going to be paid for the ad space on your page.You leave it to Google to decide whether to give you ads which could pay just a few cents per click or ads which could pay a few dollars per click.Google says that it always assigns ads in such a way that publishers receiv e maximum revenues, and that advertisers get the best value for their money.
So if you have a site that talks about interior design and which mentions “homemade furnishings” a great deal, Google will assume that your readers will be interested in the sample ad above. But that won’t be the only add that could appear on your page. There could be dozens of others. Google will give you the ads that it thinks will give you the highest revenues.That might n ot be the ad with the h ighest possible click price though . If a lower paying ad gives you more clicks and higher overall revenues, you should find yourself receiving that ad instead.In theory then, you could just leave it to Google to decide which ads to give you and at which price.In my experience though, that just cuts you out of a giant opportunity. You can in flu ence the choice of ads that you get on your page, both in terms of content an d in terms of price. You can certainly in fluence the n umber of clicks you receive on those ads. Google leaves that en tirely up to you — an dit’s a crucial part of the difference between earnings th at pay for candy bars and earnings that pay for cars.In short then, while signing up for AdSense can be both the beginning and th e en d of turnin g your site in to income, if you’re serious about making serious money with your site, it n eeds to be the beginning. You’ll want to make su re you ’re not getting low-payin g ads, and you’ll w ant to make sure th at you ’re getting the clicks that turn those ads into cash.