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Making Money with Google Adwords

May 24th 2012 at 12:01 AM

When talking about the Internet as a legitimate place for trade and commerce, one can’t help but speculate the costs a company runs in advertising campaigns in hopes of building a viable online market.

However, Google, Inc., the company behind the runaway success search engines, outdid itself when it launched its two-fold advertising programs—Google Adwords and Google Adsense. In essence, these two advertising programs allows for both advertisers and websites that host advertisements to make money with usage.

What is Google Adwords?

Google Adwords is the advertising program devised by Google on the basis of a Pay-Per-Click system. Under the Pay-Per-Click (PPC) system, an advertiser only pays for his or her ad placement when a searcher comes upon his or her ad and actually clicks on the link, regardless of sale or purchase. This means that the advertisement virtually runs continuously on various websites at the cost only of the number of people who visit their site! This removes the exorbitant fees other commercial websites would put upon an advertiser when he or she wishes to put up an ad there, even if he or she generates no traffic at all from that ad placement.

How does Google Adwords work?

What advertisers do when signing up for Google Adwords is also designing a textual advertisement of the product or service they are offering. They also submit a list of relevant keywords to the service or product they offer. These advertisements will appear on the right-hand side of a Google page.

However, one may have guessed that the huge volume of businesses under various categories may indeed end up with similar keywords in mind for submission in Google Adwords. In determining which company gets which keywords, Google Adwords devised a bidding system for keywords alongside a content relevancy system.

In the bidding system, advertisers bid and compete for advertisers. Auctioning off keywords usually start at around 5 cents, and it is through this system that various advertisers try to outbid their competition. However, owing to the fact that this may seem as though relevance and advertising placements are completely based on an advertiser buying his or her place, Google Adwords also takes into consideration through an automated computer system the relevance of the content of the website to the keywords submitted to the system.

How does Google Adwords look like after all this work?

The Google ad appears usually on the right-hand side of the page that’s signed up to host various Google Adwords advertisements. The company’s advertisement will appear only when the keywords under which it ad was listed was directly searched for by the web searcher. Again, payment for the advertisement placement only happens once the searcher clicks on the ad.

How can one minimize the costs of the Pay-Per-Click (PPC) system while maximizing profits from sales and purchases?

Google Adwords, unfortunately, is not a no-brainer earning system for a company advertising products or services. It requires a little bit more common sense; after all, it is of interest to minimize still the costs of the Pay-Per-Click system. If searchers keep clicking on ads without these clicks turning into tangible purchases, a company would end up paying more to Google than receiving profits from the traffic brought in to the website.

Simply put, minimizing PPC system costs will only happen if the more serious buyers are the ones clicking the advertisements put up on Google Adwords.

The first step into making this scenario happen is by not being in the top portion of the preferred keywords. While indeed, being on the top three of the most preferred links would generate more clicks than placing lower in the ranks, it would also mean inviting the clicks of a variety of searchers—the interested buyers, the curious searchers, the leisurely searchers not really looking for anything in particular, and the searchers completely clueless about what they are looking for and would keep on just clicking on to find out more.

Obviously, without targeting the people clicking on the advertisements, the PPC system costs will add up, without necessarily meaning purchases.

However, by being in the latter portion of the list, there is a greater propensity that the traffic being generated comprises those searchers who are seriously seeking to purchase a product or service. Even being on the second page of the search page may not be a bad thing; after all, these are the search pages found only by those who are seriously out to buy a product, and are those accessed by usually the more informed and intelligent buyers.

Moreover, sales will be greatly maximized by increasing relevance of content in the website and keeping all the links alive. By having more relevant and targeted content, a company avoids having its advertisements being clicked by people who get confused as to what the advertisement really is for. Live links keep assuring relevant traffic flows into the site, and even the continued featuring of the advertisement on other pages.

At the end of the day, Google Adwords is a viable tool in order to increase traffic to one’s e-business if used in the most efficient way possible. By minimizing irrelevant clicks and instead targeting those who are truly looking to purchase a product or service, a company can best assure the profits they collect would be much greater than the costs they have to pay for each click on their Google Ad.

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