how they make money and how you can make money on the web
How Google Makes Money with their Web Search
When the founders of Google first conceived their web search idea, they had no clue how it would make them money; they just knew they had a superior product to anyone else out there in web search. In fact, advertising wasn’t even in their initial business plan. Other web sites and web searches at the time when Google was first conceived, the late nineties, had come up with many different mechanisms to generate ad revenue from their users: full colour banners, pop up messages, basically anything that could distract from what the people are actually looking for on their website. However, these things drove people crazy, because if someone is trying to conduct a web search, or is trying to lookup some sort of information on the web, the last thing they want is anything that prevents them from instantly accomplishing the desired task. Also, in the late nineties, when dial up connections were the norm, an animated ad space on your web site would add to your page’s load time substantially. It’s crazy to think of this now, but with a dial up connection it could take upwards of 20 to 30 seconds to load a plain text site, an animated ad could potentially double this time. Another negative with these ads were the fact that a popup, or a slow load time would attach a negative stigma to that site in the mind of the user; if the user connects a negative mood with their experience on a given site, then they will avoid that site in the future and try to find another site that creates a more positive experience for them.
What set Google apart from others in regards to ad revenue was the fact that they stuck to a few key principles that ended up paying off big time.
- Stick to the quality and speed of the actual search, with advertising being an afterthought.
- Just use plain text ads that don’t distract or annoy the users, just a few simple words with a URL attached to them.
- Attach relevant and meaningful ads next to the web search, just as the PageRank algorithm indexed superior search results, it could also tailor fit appropriate advertising based on what the user is searching for
Achieving a perfect match between advertiser and consumer was quite easy for Google to accomplish with the addition of their PageRank algorithm to the ads. After all, based solely on the information that a user is searching for, there is quite a bit to be learned in what advertisements they may be interested in, despite the complete anonymity. This is further enhanced by the fact that once Google’s ad business caught on, there was a vast array of advertisers to choose from.
The structure of the exchange of money through these ads is quite simple also. The ads operate on a pay per click (PPC) system, where it could be a few cents per click by the user. If the advertisers feel a stronger desire to market their product, then they will raise their auction price for that coveted ad real estate on the search page. Advertisers love it because their audience is nearly always engaged and interested in the product; the act of simply clicking on the ad implies an active initiative from the user that they would like to hear more about the product or service being offered. It is quite hard to achieve this kind of captivated audience in any other medium for advertising.
The basic concept of what takes up the ad space is deceptively simple: if the user searches for flights to Maui, then show ads about flights to Maui. Chances are that person at that very moment is interested in learning about a flight and maybe other topics associated with Maui, and they are probably more interested in that than anything else at that specific moment. Because Google’s ad generating algorithm is so effective in matching the user to its appropriate ad, unmatched by anyone else on the web, the ads are generally quite close in relevance to the top 5 search results that the search engine generated. What I mean to say is you’re almost as likely to find what you’re looking for with the ads as you are with the actual search engine results. That means a lot of ad clicks. So basically, this became the cash cow for Google and was the primary revenue generator for the company. This is why Google’s income statements have consistently been in the billions in recent years, and this is why they have the cash flow to take on such massive projects that no other company would dream of tackling (Google Maps, Google Books, etc.).
How You Can Make Money with Google’s Ads and Other Web Tools
If you have your very own website, you can install a handy little application called Google AdSense to start making you money. This app operates in the same way that their web search does. It scours the information on your website for information that it can relate to its advertisers. It adds small unobtrusive text ads in a banner on a specified area of your site, probably the sidebar, and pays you money for every click. I’ve talked to people who say that ANY blog can make a person $50 to $100 a month, regardless of the topic, as long as it is captivating and regularly updated. If you’re talking about a valuable web resource that generates regular worldwide traffic to the site, then you could be talking about big bucks. So start blogging, start programming relevant websites, because there is money to be made out there.
Google AdSense is not the only way to make money with a website, there are countless other advertisers, but AdSense has a reputation of generating extremely relevant ads, and relevant ads mean more clicks, and more clicks mean more money in your pocket. AdSense is basically an outsourced version of their very own site’s ads.
But a good idea for another way to make money is through the Revver Video Sharing Network, revver.com . Revver is a bit of a YouTube spinoff, but the vital difference being how they deal with the advertising revenue: 40% goes to Revver, 40% goes to the video’s creator, 20% goes to the video’s sharer. What this means is if you create a hit video on the web, say with 1,000,000 views, then you collect on those, just based on the fact that a proportion of the viewers on Revver’s site will visit one of the advertisers. But there is a compounding effect in the fact that if other people begin sharing that video and passing it around to their friends, in the sense of a funny video being emailed around offices, then you continue to collect based on other people’s sharing. Another good part about it is you don’t even need to be the creative genius behind the video, you could simply be quite good at finding other people’s funny or useful or informative videos. Because on the web, traffic leads to money, so if you can generate the traffic on your website, then these tools could make you some pretty good money. Just the hard part is generating that kind of traffic; it’s easier said than done to get a site with 1 million plus views.
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