Google Adsense; The Google Ad Network

Google AdSense is a program run by Google that allows publishers in the Google Network of content sites to serve automatic text, image, video, or interactive media advertisements, that are targeted to site content and audience. These advertisements are administered, sorted, and maintained by Google. They can generate revenue on either a per-click or per-impression basis. Google beta-tested a cost-per-action service, but discontinued it in October 2008 in favor of a DoubleClick offering (also owned by Google). In Q1 2014, Google earned US $3.4 billion ($13.6 billion annualized), or 22% of total revenue, through Google AdSense. AdSense is a participant in the AdChoices program, so AdSense ads typically include the triangle-shaped AdChoices icon. This program also operates on HTTP cookies. Over 14 million websites use AdSense.

Google uses its technology to serve advertisements based on website content, the user's geographical location, and other factors. Those wanting to advertise with Google's targeted advertisement system may enroll through Google AdWords. AdSense has become one of the popular programs that specializes in creating and placing banner advertisements on a website or blog, because the advertisements are less intrusive and the content of the advertisements is often relevant to the website. Many websites use AdSense to make revenue from their web content (website, online videos, online audio content, etc.), and it is the most popular advertising network. AdSense has been particularly important for delivering advertising revenue to small websites that do not have the resources for developing advertising sales programs and salespeople to seek out advertisers. To display contextually relevant advertisements on a website, webmasters place a brief Javascript code on the website's pages. Websites that are content-rich have been very successful with this advertising program, as noted in a number of publisher case studies on the AdSense website. Google has removed the policy of limiting AdSense ads to three ads per page. Now, Adsense publishers can place unlimited amount of AdSense ads on a page.
Some webmasters put significant effort into maximizing their own AdSense income. They do this in three ways:
  1. They use a wide range of traffic-generating techniques, including but not limited to online advertising.
  2. They build valuable content on their websites that attracts AdSense advertisements, which pay out the most when they are clicked.
  3. They use text content on their websites that encourages visitors to click on advertisements. Note that Google prohibits webmasters from using phrases like "Click on my AdSense ads" to increase click rates. The phrases accepted are "Sponsored Links" and "Advertisements".
The source of all AdSense income is the AdWords program, which in turn has a complex pricing model based on a Vickrey second price auction. AdSense commands an advertiser to submit a sealed bid (i.e., a bid not observable by competitors). Additionally, for any given click received, advertisers only pay one bid increment above the second-highest bid. Google currently shares 68% of revenue generated by AdSense with content network partners, and 51% of revenue generated by AdSense with AdSense for Search partners. On June 18, 2015, Google announced rebranding of AdSense with a new logo

Google launched its AdSense program, originally named content targeting advertising in March 2003. The AdSense name was originally used by Applied Semantics, a competitive offering to AdSense. The name was adopted by Google after Google acquired Applied Semantics in April 2003. Some advertisers complained that AdSense yielded worse results than AdWords, since it served ads that related contextually to the content on a web page and that content was less likely to be related to a user's commercial desires than search results. For example, someone browsing a blog dedicated to flowers was less likely to be interested in ordering flowers than someone searching for terms related to flowers. As a result, in 2004 Google allowed its advertisers to opt out of the AdSense network.
Paul Buchheit, the founder of Gmail, had the idea to run ads within Google's e-mail service. But he and others say it was Susan Wojcicki, with the backing of Sergey Brin, who organized the team that adapted that idea into an enormously successful product. By early 2005 AdSense accounted for an estimated 15 percent of Google's total revenues. In 2009, Google AdSense announced that it would now be offering new features, including the ability to "enable multiple networks to display ads". In February 2010, Google AdSense started using search history in contextual matching to offer more relevant ads. On January 21, 2014, Google AdSense launched Direct Campaigns, a tool where publishers may directly sell ads. This feature was retired on February 10, 2015.

    How it works

  • The webmaster who wishes to participate in AdSense inserts the AdSense JavaScript code into a webpage.
  • Each time this page is visited by an end user (e.g., a person surfing the Internet), the JavaScript code uses inlined JSON to display content fetched from Google's servers.
  • For contextual advertisements, Google's servers use a web cache of the page created by its Mediabot "crawler" to determine a set of high-value keywords. If keywords have been cached already, advertisements are served for those keywords based on the AdWords bidding system. (More details are described in the AdSense patent.)
  • For website-targeted advertisements, the advertiser chooses the page(s) on which to display advertisements, and pays based on cost per mille (CPM), or the price advertisers choose to pay for every thousand advertisements displayed.
  • For referrals, Google adds money to the advertiser's account when visitors either download the referred software or subscribe to the referred service. The referral program was retired in August 2008.
  • Search advertisements are added to the list of results after the visitor/user performs a search.
  • Because the JavaScript is sent to the Web browser when the page is requested, it is possible for other website owners to copy the JavaScript code into their own webpages. To protect against this type of fraud, AdSense publishers can specify the pages on which advertisements should be shown. AdSense then ignores clicks from pages other than those specified.


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