Last Updated on June 4, 2020 by Ron Stefanski

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How Does Google AdSense Work?

If you came here to understand how Google AdSense works, that’s awesome. I was in your shoes in 2014; I had just created my first website and I had no idea what I was doing either, so it’s fine if that’s your situation right now. 

I have actually documented my journey on this website, so you can check out my income reports to see how my business has grown over time. I’ve been at this for a while and I now make a good living by doing it full-time. 

But enough about my website—you are here to understand Google AdSense, and I’m here to help you. First off, you should know that I have a full AdSense playlist on my YouTube channel, so you should definitely check that out. There’s a lot of information about how to set it up, the rules, and really everything you need to know.

WATCH THIS BLOG POST IN VIDEO FORMAT

Overview of Google AdSense 

So what is Google AdSense, and why is it important? Google AdSense is an ad network that anyone who has a website on Google is able to use.

 First, publishers will put ads on Google AdWords, (which is a totally different platform) in order to advertise on Google, and then Google AdSense acts as the complement to that for third-party websites.

If you have your own website, you can use Google AdSense. All you need to do is put some code on your website. Then, Google will look through your content to understand what it’s about, because they use contextual advertising. That means that they’ll serve ads automatically for your users that are relevant to the content on your website. 

It’s really easy to implement Google AdSense, and you can actually make quite a bit of money from it. It’s an awesome platform; I’m really glad that Google came out with it because it’s how I make a living. 

Why AdSense is a Compliment to Google AdWords

This is how it works: advertisers will go into Google AdWords and say, “I want to take an ad out.” For example, they might have a website all about camping, so they’ll say, “I want to advertise tents.” Then, Google AdWords says, “Okay, great. Here is what you need to do; go ahead and create ads on Google AdWords.”

When people create ads on Google AdWords, they will show up on the results page when you search using Google. For example, if you go to Google and search “buy tent,” you’ll see the ads shown in the image below. 

As another example, you could type in “best shoes for running” and see the ads pictured below. As you can see, there is also an ad from Zappos. These are great examples of ads that people take out through AdWords.

When they take out an ad, Google understands that, “Hey, this ad was about camping/tents/running shoes.” The Google Display Network is always on, by default, though some people choose to turn it off. The Google Display Network includes all the websites with AdSense on them.

What this means is, when somebody searches “tents,” Google will look through their whole portfolio of websites (which is millions of websites) and if you are a part of their AdSense program, it will understand that your website has a lot of information about tents, so they’ll put the ad about tents on your website. 

That’s how Google AdSense actually works; it matches Google AdWords clients with Google AdSense publishers, which is how you make money.

How (And When) Do You Make Money on Google Adsense?

Your website is going to show ads based on what Google thinks best matches your content. When you put Google AdSense ads on your website, you don’t need to tell Google anything; you just put the ads on there. 

Then, Google will crawl your website to understand what it’s about, and they will show the most relevant ads to your users. This is awesome because it takes very little work on your part. You just copy some code, put it on your website, and give it a little bit of time.

Google is very smart, so the ads are going to be contextual. If they work, they can lead to a lot of great things for you; one of them, obviously, being an increase in your income. 

Now, one of the questions that people consistently have is, “Well, that’s all great, but how do I actually get paid with Google AdSense? How do I make money?” It’s pretty simple—every time users click on an ad on your website, you make money. 

To understand this, let me backtrack a little bit and talk about Google AdWords and advertisers. When somebody publishes something on Google AdWords, Google will say, “Okay, how much do you want to pay per click?” There are other ways to do it too, but for the most part, the advertisers pay when somebody clicks that ad. 

For example, the advertiser might say, “I want to pay a dollar per click. That’s what it’s worth to get a person over to my website.” So, does that mean that when you put a Google AdSense ad on your website and somebody clicks on it and goes over to another person’s website, you would make a dollar?  

No, because Google takes their share. About 70% goes to the publisher (website owner) and 30% goes to Google. They would make 30 cents on the advertisement, and you would make 70 cents.

How Much Does Google AdSense Pay?

Now, how does Google determine how much they’re going to pay? That’s a difficult thing to understand because they have the 70/30 split, but why is it that some people make a lot of money and some people don’t? 

It comes down to how in-demand the ads are. For instance, say you have a website all about lawyers, which historically pay crazy amounts of money per click. They may pay between $30-$40 per click just to get people to their website. If you have a website about a lawyer network, then you’re driving a bunch of clicks over to those lawyer websites. 

You could make a significant amount of money from this, assuming it’s a 70/30 split. If it’s a $10 for every click, then that means that you would make $3 every single time somebody clicks on your ad, so it can be significant.

Conversely, if there aren’t many advertisers, you’re not going to make very much money. If you had a website on how to make bacon and egg sandwiches, there won’t be many advertisers for that. Advertisers don’t care, because that’s not something of interest to them. 

If you put Google AdSense on that website, you could have some general ads show up (not related to bacon and eggs) that people are using to get anybody to click, and you might make a couple cents per click. 

It’s not much, but that’s how much Google Ads AdSense pays. It all depends on what the demand is for the advertisers. The more that the advertisers pay, the more money you make for every AdSense click. 

How Much Money Can You Make With Google AdSense?

This is a very common question, so I’m just going to show you how much you can make. Now, you’ll notice in the image below that a few things on my screen have been blurred—that’s because it is against Google AdSense’s terms of service to disclose some of this information. But as you can see, you can make a very good living by doing this. 

This image shows my Google AdSense account summary for January 1st, 2018, all the way through December 31st, 2018. In that timeframe, I made $143,169.14 cents last year alone. That is across multiple websites. You can make a lot of money if you have multiple websites with traffic. 

Even if your website is young and doesn’t have much traffic, you can watch a video I made that shows you how to put AdSense onto your website and you can still make some money. Even if you make an extra $5-$10 a month, that’s better than $0. 

The thing is, you just have to drive a lot of clicks. It’s very possible to do, but you have to have the right strategy set up and implement AdSense correctly.

In the next image, you can see my earnings for this year. You can see that during the weekdays, I’m getting around $400-$500 a day. Again, this is just from Google AdSense; if you’re driving a lot of clicks, you can make a lot of money. On the weekends, I make around $250-$300 a day, so it’s a good living.

The best part about AdSense is that it’s completely passive, and I mean that. You create content, you publish the content, it gets indexed by Google, it does well on Google, and then you put AdSense on there, and that’s it. Then, Google handles the rest of it and you literally collect a check every single month.

AdSense is not a scam. When I was looking at this stuff years ago, I was like, “Eh, I don’t know if it’s real,” but trust me, it is.

Google AdSense In Action

Now that I’ve talked about all of it, let me show you Google AdSense in action. As you can see below, this is one of the income reports that I share here on my blog every month, and I have Google AdSense ads on them.

If you’ll notice, there’s a little flag and “X” in the upper-right corner, so you can tell it’s an ad. This blends in with my website reasonably well, but it’s still an ad. 

At the bottom of that image, you can see the “Sponsored Searches,” which is also a Google AdSense ad unit. I only put two ads on each of my income reports. Check out this video to learn more about the placement of your AdSense ads.

If I refresh the page the ads will change, but they’ll still be related to the content on my website. As you can see in the image below, there is an ad from LinkedIn. Google has determined that this particular ad is relevant to my website.

Also, don’t click on your own ads because if you do too much of that, you might get you banned from the program. Don’t try to fool Google, because they’re very, very smart. 

Overall, that is how Google AdSense works. If you’re interested in more information on this topic, check out my AdSense playlist on my YouTube channel and give it a like while you’re there. Otherwise, thank you guys for reading, and congrats for taking the steps to create your own website; I love the spirit of online entrepreneurs.


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