With the consent of website owner small contextual ads are published which is known as Google Adsense. The ads are created for selling products and/or creating brand awareness by publishers. The created ads are called Adwords that is also a Google sponsored program.
Google Adwords and Adsense are very closely linked. Every time someone does a search on Google or one of their partner networks and clicks on one of the sponsored ads, then the person who created that ad will pay Google a predetermined price. This has become known as "pay per click".
Now the beauty of Adsense is that the person who owns or hosts the website that the Adwords ads appear on will split the amount of money that Google receives from the creator or publisher of the ad. For our purposes, let's assume the split is 50%, but it is a well guarded secret what exactly the percentage of the split is, but it does vary.
The host of the website that displays the Adsense ad can receive .20 when that ad is clicked, if the publisher is paying .40 in total for the Adwords ad. The remaining .20 belongs to Google. This indicates how the website owners and Google are partners in this scheme.
Adsense is shown in the most relevant way possible. What does this mean? Well, probably the best way to illustrate this would be through an example. Let's assume a website featuring women's clothing that is owned by Mary. If Mary wanted to monetize her website with Google Adsense the ads that would be shown would all be related to clothing, and more precisely, women's clothing. In her website if shoes are dedicated to a particular page, then on that page there would be Adsense ads appearing for women's shoes.
So how do we calculate how much revenue a click generates? This is where the Adwords side of the equation kicks in. Adwords publishers place bids on various keywords. A more sought after keyword will result in the publisher paying more for each click. The range of values for each keyword can be from a few cents to more than $50 per click.
Therefore combining a high traffic website with Google Adsense can result in a very lucrative deal. Several Internet marketers will actually create specifically targeted sites in order to attract lucrative Adsense ads. -
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