Why Your Adsense Clicks Aren't Equal To Adwords CPC's

[internetmarketer99]

One of the common themes I see here and elsewhere regarding Adsense is the whole notion of "high paying keywords".

Of course anyone monetizing sites with Adsense wants to maximize their earnings - in fact, this is often what drives niche and keyword selection.

But their is this mistaken notion that Adsense clicks are equal to Adwords CPS's (Cost Per Click), minus whatever Google's cut is.

Many people use Google's Adwords Keyword tool, SpyFu, or SEOBook's Keyword Tool in order to determine what the payout should be for their keywords.

Here's the problem with that idea: All those keyword tools are reporting (to greater and lesser degrees of accuracy) the costs for advertising on SEARCH NETWORK.

Adsense ads appear on CONTENT NETWORK.

There is a HUGE difference. Not only is the base cost structure different, but in some cases the RELATIVE costs are different.

For instance, "mortgage" is a high-cost keyword - if you're going to run ads on the search network.

Google's Adwords tool shows an estimated CPC of $15.37 for ad positions 1-3.

SpyFu shows a CPC of $1-$16.72

I am running ads in that niche - ON THE CONTENT NETWORK - and paying $0.12/click.

In another example, I have an Adsense site in the "credit" niche. I am getting appx. $1.50 per click for ads targeting the phrase "credit repair".

Google's adwords tool estimates the CPC at $8.24.

The point is, estimates for clicks are based on the search network, but Adsense ads payout based on costs on the content network.

To further "muddy the waters", the content network isn't keyword-targeted. Advertisers aren't bidding on keywords, they are bidding on placements for their ads.

The net is that Adwords CPC's don't equal Adsense payouts.

Can you use CPC's as a relative guideline? Yes - to a degree. It's important to realize that content network advertisers pay a small fraction of search network CPC's for those ads.

It's also important to realize that the ad payouts drop precipitously, from the "first" ad (the one that is encountered first in the HTML source code). If someone clicks on ad #3 in an adblock, or even ad #1 in the second ad block, it may very well pay pennies even for a "high-paying" keyword/niche.

Mark

[ebuyer123]

Long story cut short...that's how big G making their billion $$$ year in year out. Therefore, the G will ALWAYS making sure that the inequality of costs is there forever.

Just my 2 cents.

ebuyer

[dburk]

Hi internetmarketer99,

You make some valid points, the Search Network and the Content Network are very different.

But their is this mistaken notion that Adsense clicks are equal to Adwords CPS's (Cost Per Click), minus whatever Google's cut is.

This is no mistake, it is what actually occurs, and yes it is AdWords advertisers that are advertising on the Content Network. There is nothing sinister or evil going on here.

Many people use Google's Adwords Keyword tool, SpyFu, or SEOBook's Keyword Tool in order to determine what the payout should be for their keywords.

Here's the problem with that idea: All those keyword tools are reporting (to greater and lesser degrees of accuracy) the costs for advertising on SEARCH NETWORK.

These tools do not claim to report your payouts, they tell you what it cost the advertisers for the top ad positions. I don't see the problem, these tools clearly state what they show you. Why would you consider this a problem?

For instance, "mortgage" is a high-cost keyword - if you're going to run ads on the search network.

Google's Adwords tool shows an estimated CPC of $15.37 for ad positions 1-3.

SpyFu shows a CPC of $1-$16.72

I am running ads in that niche - ON THE CONTENT NETWORK - and paying $0.12/click.

This is a comparison of the range bids will vary in a niche. You have taken one of the single highest Search Network keywords in a niche and contrasted that with what one might expect at the low range of the Content Network for the niche, not the term. There will be many keywords that will be far less expensive in this niche and those same keywords will trigger ads on a blog in this niche.

If your website is generating bids at the low end, and I believe for this niche it is, you should take heart in the knowledge that the opportunity exists to earn much more in that niche. You are competing with lots of other websites in this niche and you will earn far more if you sharpen your skills.

The point is, estimates for clicks are based on the search network, but Adsense ads payout based on costs on the content network.

Yes it is, and as far as I can tell this has been made painstakingly clear by the AdWords and AdSense programs. I see nothing "muddy" here. Maybe I am misunderstanding your tone, but what problem do you see with this?

You are competing with other AdSense publishers and only the best converting sites will get the highest clicks. It's a market, you have to be at the top to earn the top pay.

[dburk]

Originally Posted by ebuyer123

Long story cut short...that's how big G making their billion $$$ year in year out. Therefore, the G will ALWAYS making sure that the inequality of costs is there forever.

Just my 2 cents.

ebuyer

Yes, Google does an excellent job of providing superior value to their searchers, publishers and advertisers.

It's a wonderful thing to see folks do well for their suppliers, customers, employees and investors and earn accordingly. It sure makes me proud to be American.

[internetmarketer99]

Originally Posted by dburk

Hi internetmarketer99,


Yes it is, and as far as I can tell this has been made painstakingly clear by the AdWords and AdSense programs. I see nothing "muddy" here. Maybe I am misunderstanding your tone, but what problem do you see with this?

Hi Don,

Thanks for the post, though I'm afraid you were mistaking my tone. I've very aware of all of the above - I'm Google Adwords Certified and manage appx. $100k in Adwords spending under consult. I'm very familiar with both Search and Content networks, as well as the keyword tools mentioned. The examples were used specifically to underscore the differences in cost structure between the two.

My point, and tone, were to highlight the errors in the 'common thinking' that I see numerous threads reflecting - the "Search-Network-CPC-equals-Adsense-payout" mistake - and then point out where these commonly-held but mistaken presumptions come from.

Long story cut short...that's how big G making their billion $$$ year in year out. Therefore, the G will ALWAYS making sure that the inequality of costs is there forever.

Hi Ebuyer,

There is in fact no inequality. What I was trying to point out was that many people are assuming the cost for ads on their Adsense sites, of which they get a split, is not based on Adwords Search Network, but rather on Content Network, which has a far lower CPC.

Mark

[jmidas]

Is there a good tool for estimating adsense click prices? I have been using adwords for many years, but have never done a thing with adsense. I think it is time to start.

I guess one of my biggest questions is how do i know what a particular keyword or ad is paying?

[dburk]

Hi jmidas,

Since this varies for each website, and even for each individual page on the same website, there is no way to predict this. You will know when you test it on your own page.

You can get a relative idea by running your own AdWords ads on the Content Network or use tools like Spyfu or KeywordSpy. Keep in mind that these will only give you relative costs not actual payouts so it's only useful as an indicator of commercial value.

Since you will be competing with many other publishers your own results will depend a great deal on how well you target keywords, which keywords you target and especially how well you target your traffic, both in terms of content and traffic sources.

[businessmentor]

***Content Network***

Only if you are placement targetting.
Otherwise, it is keyword targetted - it is the keywords which you include in your ad groups which are used to determine where to display your ads.
The number of impressions you get, obviously, will depend on your bid price.

Originally Posted by internetmarketer99

To further "muddy the waters", the content network isn't keyword-targeted. Advertisers aren't bidding on keywords, they are bidding on placements for their ads.

Mark

[jmidas]

Thanks Don.

[Liquidgraph]

Excellent post IM99.

I wonder, what sort of click-thru are you experiencing on your $1.50 credit repair ads?

[Narayan]

Originally Posted by dburk

This is no mistake, it is what actually occurs, and yes it is AdWords advertisers that are advertising on the Content Network. There is nothing sinister or evil going on here.

I think the point internetmarketer99 makes here is not, that the adsense payout isnt adwords-cpc minus google-cut. But that this adwords-cpc is often different in the content-network from the search-network of the same advertiser.

The search network is usually converting better than the content-network (people are in the search-mode, not in the read-mode!). That's why advertisers prefer the search network. I myself use the content-network sometimes, but in a special adwords campaign different from the search-campaign with a much lower cpc.

I also noticed the lower cpc on the content-network, since there is less competition than in the search network. So I get a click on the content network for 1/4 of the price in the search network.

That's why the adsense payout is not the keyword-price as displayed on the spot 1 adwords-price minus about 50% or whatever google takes out. In my experience you can get about 1/5 of this price for the no.1 ad. I.e. from my experience: if #1 search adwords spot is $15 a top price to be expected is $3 on adsense.

[dburk]

Originally Posted by Narayan

I think the point internetmarketer99 makes here is not, that the adsense payout isnt adwords-cpc minus google-cut. But that this adwords-cpc is often different in the content-network from the search-network of the same advertiser.

The search network is usually converting better than the content-network (people are in the search-mode, not in the read-mode!). That's why advertisers prefer the search network. I myself use the content-network sometimes, but in a special adwords campaign different from the search-campaign with a much lower cpc.

I also noticed the lower cpc on the content-network, since there is less competition than in the search network. So I get a click on the content network for 1/4 of the price in the search network.

That's why the adsense payout is not the keyword-price as displayed on the spot 1 adwords-price minus about 50% or whatever google takes out. In my experience you can get about 1/5 of this price for the no.1 ad. I.e. from my experience: if #1 search adwords spot is $15 a top price to be expected is $3 on adsense.

Hi Narayan,

I commented on this because it was not clear to me what point he was making, and to his credit, he clarified his point with a followup post.

I agree that the Content Network has a much lower CTR than the Search Network, but disagree that it has lower conversions. If you write your ads well enough you can have very good conversion rates from the Content Network. The key is write ads that filters out information seekers.

[Narayan]

Originally Posted by dburk

The key is write ads that filters out information seekers.

That's a good advice!

[ebuyer123]

Originally Posted by dburk

Hi Narayan,
If you write your ads well enough you can have very good conversion rates from the Content Network. The key is write ads that filters out information seekers.

100% agree with this one, but there are something REALLY important to add on here:

1. Must use TRACKING down to both the keyword and webpage levels, and
2. Base on analysis of tracking result, BLOCK some Adsense site domain URLs.
3. Well...there are at least 10 more tactics you can use to make at least $100/day from affiliate sales by targeting those filtered Adsense sites...

P/S: Keyword spying is a MUST for folks who are seriously lack of vitamin 'M' (i.e. money) to start with.

ebuyer

[charles jackson]

This thread has answered alot of questions for me. thanks.

[maestero2010]

adesense and adwords payout are different..........google do no declares anything about it..........the fact that there is diff in them is that as google being the third party eats away some part of the earned amount.............wen you use adsense on your website you receive less than what you pay for adwords..........