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Google’s AdSense

May 24th, 2004 · No Comments

WSJ writes how some entrepreneurs are seeking to exploit Google’s AdSense:

Here’s how the system works. AdSense serves text ads to sites that have related content — for instance, a Dell ad might run on a site about computers. Advertisers pay when user click on the ads, anywhere from a few pennies a click to $20 or more for particularly sought-after topics. Google shares a percentage of that bounty with the Web site owners, though it doesn’t reveal the specific split.

To exploit this, some sites enlist in the AdSense program and build pages targeted at topics that are likely to draw high-value ads, automatically “served” from Google.

“I find the most competitive and most expensive areas, and build sites around them,” says Howard A. Brown, 36, the owner of Studio City, Calif.-based Real Results LLC, who runs sites on mesothelioma, depression and dyslexia. The eventual goal, he says, is to find sponsors for his sites, but in the meantime, AdSense “is a quick way to add some revenue.”

Ed Kohler, a search-engine marketing consultant in Minneapolis, has a more complex strategy — essentially AdSense arbitrage. He buys cheap ads to draw users to his site, HaystackInANeedle.com, where he writes about topics that will attract expensive ads. If a reader clicks on his cheap ad to come to his site, and then leaves the site by clicking on an expensive ad, he makes money on the difference, minus Google’s cut.

For example, Mr. Kohler wrote an article last September about shopping-cart software, something of interest to e-commerce companies. He tweaked his article to make sure the right Google ads — those worth $3 or more per click — would be served onto his site. (One of the expensive search terms: “best shopping cart software.”) Then he bid for several search strings like “evaluating shopping cart software” that were available for five cents a click. If someone who searched for “evaluating shopping cart software” on Google was directed to Mr. Kohler’s site, and then clicked on one of his ads, he would be paying just five cents to get about $1.50 from Google, depending on the Google split.

“If one in 10 are clicking out [through an expensive ad], I do okay,” says Mr. Kohler. He says he used to make about $150 per month on the shopping-cart software article alone. That’s down to $75 per month now that Google has tweaked its payment system to charge advertisers less for some clicks.

Underpinning this new cottage industry is a recent shift in search-based ads, which is the fastest-growing form of advertising on the Net, generating about $2.5 billion in revenue last year. Google and archrival Yahoo Inc. have expanded their programs beyond search engines, enlisting publishing partners to place these text same search ads on content pages. So, in addition to running alongside Web-search results, the same Dell ad could run next to an article on a news site about personal computers.

Yahoo has kept distribution narrow, choosing mostly large publishers, including ESPN.com and The Wall Street Journal Online. But Google has opened its AdSense program to a wider audience, serving ads everywhere from trade publications to personal home pages. Small sites seeking to capitalize on high-value keywords enroll their sites in the program, and then work to attract Web traffic, often by tweaking their sites to climb in search-engine rankings.

Tags: Search Engines

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