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AdSense Explained

By: Andrew Nielsen
Online Business Builder
Published: January 18 2007

If you have a blog or website (or would like to create one) you can make money by signing up for Google's AdSense and then displaying their ads on your webpages. In this article we describe how AdSense works and give pointers for optimizing the revenue you can generate with it.

Through AdSense, you allow Google to display ads on your site or blog. You've probably come across many pages with blocks of ads with the text 'Ads from Google' next to them. Technically, AdSense works so you put a small piece of scripting code on your page and with this, ads from Google are shown automatically.

You make money when someone clicks on these online ads. Google will not tell you how much they will pay you before you sign up – they encourage you to join and then you'll see what you'll make as the revenue starts building. The reason is that they give you a percentage of the revenue they generate for the click on an ad. And the value of such a click varies with the content of the page, since Google displays ads on a webpage matching its content. A webpage about traveling is thus likely to display ads for airplane tickets, hotels, travel insurance and similar. Having ads related to the topic of the webpage is a way of making it more likely that a visitor will click on an ad. And since Google makes money per click on ads, they are keen on making as many visitors as possible click. The amount of visitors who click on an ad, divided by the number of visitors seeing it, is known as the click through rate or CTR.

If you already have a website or blog and wish to place AdSense ads on it, Google will match ads to the content already there. This means you have less influence over the theme of the ads and thereby the revenue they generate for Google and for you. If however you create a new website or blog with the purpose of making money online, you have a choice of theme for the content you produce. If you produce content for which advertisers pay a high price for clicks on ads, you will obviously generate good revenue for yourself.

Google finds its advertisers through their AdWords product. This works, so advertisers sign up and make bids for certain keywords. The advertisers with the highest bid for a certain keyword will have their ads shown first on pages where Google has matched the content to the keyword. This means that the clicks will pay well on ads on pages with content related to keywords with high bids. To determine which keywords pay well you can use Google's keyword tool, found via the links below.

There are many – and sometimes contradictory – pieces of advice for placing ads on pages in order to achieve a high click through rate. You can decide what size of ad block you want and also decide about colors of text and background. This means that you can create big ads with loud colors in order to make sure that visitors see the ads. You can also do the opposite, which is to try to blend the ads into your webpage, by giving them the same font size, and font and background color as the rest of the page. Finally, you can place graphics around the ads in order to liven up the sometimes dull text ads Google provides. Google will not display more than three ad units on a given page – bear this in mind when designing a page. Trial and error seems to be the best way to optimize the appearance of ads.

Signing up to the program is completely free and quite simple. Putting the scripting code on a page is similarly very simple – you simple copy and paste the code provided by Google. Follow the links below to sign up for Google AdSense.

Note that Yahoo!, MSN and others offer similar programs and you can check them out too, to find out what generates the most revenue for you.

Last a few warnings. You may think that you can sign up and spend your day sitting at home clicking the ads on your site to generate revenue. This would however constitute what is commonly known as click fraud. When you sign up for AdSense you have to agree that you will not click on your own ads. You also have to agree that you will not encourage your visitors to click by including text like "please click the ads below" or "visit our sponsors". While a lot of people certainly try to cheat – and some get away with it – you should know that Google do what they can to detect cheating and will kick anyone off the program who they find to be breaking the rules.

Visit our resources page for links to sign up for Google's AdSense and for Google's keyword tool.

About the author:
Andrew Nielsen is the author of The Online Business Builder, a bestselling eBook teaching readers how to profit from the Internet and make money online.
Article source: AdSense explained


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