Just how does Google make money ?
We know that over the past 6 years Google has not only become the most successful online company, but one of the most successful companies, period.
Google has lots of strings to its bow but its biggest revenue generator is its Google Adsense advertising programme.
Adsense works hand in hand with Google Adwords
How does this work?
It’s a brilliant concept but actually quite simple.
- A individual or company who wishes to advertise products sets up a Google Adwords account.
- They then have to bid against other advertisers for keywords for their ads.
- Then comes Adsense, anyone wishing to use Adsense needs a website or blog, then once the account is active you create your ads from the Adsense interface, the Adwords ads are then displayed on websites showing Adsense ads.
One this is done some code will be generated that you paste into your websites pages.
This will automatically generate ads that are in line with the pages content.
As we mentioned earlier Adwords advertisers have to bid for keywords, generally the more an advertiser is willing to pay every time someone clicks on their ads based on particular keywords, this depicts where their ads will be placed, so the more they pay generally the nearer the top of the ad block they are getting the most exposure, and generally the most clicks.
Google then takes a percentage of this
Just how does Google make money ?
We know that over the past 6 years Google has not only become the most successful online company, but one of the most successful companies period.
The percentage Google takes from each click is estimated to be between 15-30%, but this is just speculation as they never disclose the amounts.
Due to the sheer number of Adwords Advertisers and Adsense Publishers this nets Google literally billions of dollars each year.
Add this to Google’s other revenue streams and the amounts made are incredible for such a relatively new company.
In 2006 it reported profits of almost 10.5 billion dollars.
Along Google’s road to riches they have also acquired other businesses such as..
- YouTube 1.65 billion dollars
- Doubleclick 3.1 billion dollars
- Postini/Gmail 625 million dollars
- 5% Aol 1 billion dollars
This is just a few of Google’s purchases, most of which provide them with direct advertising revenue or services to enhance said revenues.
I have followed the rise and rise of Google since for many years now and while many similar companies have stagnated or fallen by the wayside Google seems to have prospered due to them being flexible and innovative to the needs of the Internet user.
It’s not the strongest or smartest species that survives, but the most responsive to change “Charles Darwin 1809-82”
We hope this article gives a basic understanding of “ how does Google make money “
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