How much can you make with AdSense and how can you get started?

You’ve seen the nutty claims by so-called “internet experts” that strategies and programs they have devised enable surfers to earn thousands of dollars within a matter of days! Or minutes!! No such thing.

However, there are several lucrative programs that can provide an extremely generous income with comparatively little effort – Google AdSense is absolutely one of them.

But it takes some time, and it takes some planning, like anything real does. The rest of our report is all about unlocking that potential.

To start understanding the potential, think about how you make money with this program. Each time someone clicks an ad on your pages, you get a percentage of what Google is paid for placing that ad.

Revenue (or Income) from an Ad

=

Clickthrough value of the ad * Payout Rate * Clickthrough rate of the Ad * Webpage traffic * Frequency of Ad

In the above equation, Clickthrough value is the amount the advertiser pays per click for the Ad (this figure varies); the Payout Rate is the percentage of revenue to be paid for every click fixed by Google (this figure varies); Clickthrough rate is simply the # of times the ad is clicked on in a certain period of time divided by the # of times it is displayed during the same period; Webpage traffic is the # of visitors to your website; and Frequency of Ad is the # of times this particular ad appears on your webpage.

Let’s put some figures into the above equation and see what the income is. The figures below are for a single day:

Clickthrough Value -> 30 cents or $0.30 (The advertiser pays 30 cents per click for the Ad, to Google)

Payout Rate -> 50% or 0.5 (This is an assumption based on what many experts believe to be the current payout rate for most deals)

Clickthrough rate of the Ad -> the ad is displayed 100 times within the day and clicked by 20

people -> the clickthrough rate would be 0.20

Webpage traffic -> 1500 visitors during the day

The Income per day from a single ad would be = 0.30 * 0.5 * 0.20 * 1500

= $202.5

If you consider this to be the average income per day, the total revenue generated within a month would be more than $1,350. This is incredible, considering you basically did nothing to earn that money. We know of cases where people have earned even more than $25,000 a month with AdSense, which is a large sum to anyone.

Our goal is to equip you to get started on the road to making money with AdSense.

AdSense is an application of AdWords beyond Google.com

Making “sense” of AdSense means understanding that it is really an offshoot of the older Google model, AdWords. But they are not the same thing.

Google AdWords:

If you have ever searched on Google, you have seen AdWords.

Google AdWords are the small text ads that are displayed on the side of the search results in Google. These ads are contextual of course – in this case the context is the search terms you entered. The ads will be served based on what you’re looking for. So, if you do a search on “printing services” you will get ads for printing services along with your search results!

How does this generate money for Google and the advertisers?

Google AdWords works on a model known as pay-per-click. When someone clicks on an AdWords ad, the advertiser of that ad has to pay Google a certain amount. It’s easy to track and fully automated.

We say “certain amount” because that amount is different all the time and is subject to market forces – in this case, bidding. Something has to determine the placement of those ads, and what determines it is how much the advertiser offers to pay per click. When you submit this kind of ad to Google, you submit it with a bid – which is compared to other bids for similar keywords. It’s an auction style process.

The position of the AdWords ads is based on the bidding amount of keywords of an ad. Obviously, the higher the bid, the higher the position the bid buys you. For instance, if the highest bid for the keywords “Internet marketing” is 80 cents per click, you can get top position by bidding 90 cents. Then every time someone clicks on your ad, Google would charge you 90 cents, and you would retain the top position until someone else bids more for the same search word placement.

Google AdSense, as stated earlier, is an extension of Google AdWords. It takes the AdWords concept and moves it off of Google’s search page and onto thousands of other web pages. The ads that are displayed on the websites are Google AdWords ads.

It’s good for the advertiser, who gets more and broader displays, for Google, who charge more for this program, for you, who will make money from the clickthroughs on your pages, and also for the consumer, who will see cool ads for stuff they are probably interested in!

So how exactly are you making money from all this? You earn a share of the pay-per-click amount, every time a visitor clicks on the ad. So you just need to get ads on your site…