With the consent of the website owner, small contextual ads called as Google Adsense are published on their sites. Publishers that are selling products and/or creating brand awareness create the ads. Adwords is what these ads are termed and it is a program sponsored by Google.
Google Adwords and Adsense operate in parallel. Every time someone clicks on a sponsored ad after they have done a search on Google or one of their partner networks, Google gets paid a predetermined price by the person who created the ad. 'Pay per click' is the term that was coined for this.
When Google receives money from the creator or publisher of the ad, they have to split the amount with the person who owns or hosts the website that the Adwords ads appear and that is the beauty of Adsense. The percentage of the split does very and it is a well guarded secret what the percentage of the split it, but let's say it's 50% for our purposes.
If the ad creator is fine to pay .40 per click for his Adwords ad, then the website host who has joined the Adsense scheme can expect to receive approximately .20 when the ad is clicked. The other .20 is kept by Google. So in effect, this is a partnership between the website owners and Google.
The fact that its placement is highly relevant is one of the most attractive qualities of the Adsense program. How so? The easiest way to see this is by looking at an example. Mary has a website featuring women's clothing. If Mary wished to utilize the Google Adsense scheme on her website, the ads would be for women's clothing. If she had a page devoted to shoes, then any Adsense ad on that page would be for women's shoes.
So how is the price per click determined? This is where the Adwords side of the equation kicks in. Adwords publishers bid on keywords. If a keyword is particularly sought after, then the publisher will pay more per click. The range of values for each keyword can be from a few cents to more than $50 per click.
It is not very hard to see how someone with a website that generates a decent amount of traffic can make some nice money by putting Google Adsense on their website. Specific content is created by Internet marketers with the sole purpose of attracting high paying Adsense ads. -
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