Unfolding the mystery Google money making tactics:
Apple, Google, and Microsoft are the Tech giants ruling the technology world. Apple makes money by selling their Apple products such as iPhone, iPad, iWatch and Mac computers. Microsoft makes money by selling their software. Have you ever wondered how Google makes money? They don’t sell any software or products but their annual revenue is more than 60 billion dollars. Google being the largest search engine in the current technology world doesn’t charge their customers to use their products and services.
Then how does Google makes money? A majority of the Google revenue is coming from advertising. Google AdSense and Google AdWords are the two major revenue platforms for Google.
Google actually released the following statement on how it actually makes money.
“Today, the majority of our revenue comes from advertising.”
It’s interesting. Google makes money through ads and we don’t see any ads on Google Homepage.
You don’t see any ads or pop up in the Google Homepage. Its homepage is clean as a whiteboard. All Google products and services such as YouTube, Google Drive, Gmail, Docs, Maps, News, and Google Analytics are absolutely free.
Photo Credits – http://www.minterest.org/
Google is earning big bucks through advertisement. Google AdWords is one popular Google product which is an auction-based advertising program. You can advertise your local business and services using Google AdWords on Google web search result pages. That’s what the mantra for Google Revenue system.
You might have noticed some ads across Google web search result pages when you perform any web search in Google. These ads are advertised by some business owners using Google AdWords. Google gets money each time from these Advertisers when a user clicks these ads.
So, if you search for “iPhone” or say “Laptops” on Google then you’ll find ads relevant to “iPhone” or “Laptops” itself.
Google AdSense is another major service provided by Google. It helps millions of bloggers and publishers to make money by displaying relevant ads on their respective blogs and websites. Google AdSense is the popular choice among bloggers and publishers as it has huge ad inventory.
Win-Win-Win situation for everyone
Google advertisement strategy is path-breaking as it is the win-win situation for everyone involved. Google advertisers pay Google based on the performance for their ads. Google gets money only when consumers click on the ads. This model is different from traditional banner ads, as advertisers are required to pay up-front for their ads to display the banner. One plus point about Google AdWords is that consumer sees only ads related to what he/she is searching. So this is a perfect advertising model as it is a win-win-win situation for everyone involved (Advertisers, Google, and Consumers).
Cost per Click
How much money is paid between advertisers and Google for each click (i.e. Cost per Click) depends on a lot of factors. Google uses their bidding system to determine the price. Advertisers usually select the keywords for which their ads should be displayed.
Let’s say you own a website selling fashion products and want to find potential buyers. So you bid on keywords like shoes, sunglasses, shirts, skirts, and jeans. So that when a consumer or a user searches for these keywords, your ads will be listed in the web search. Usually, there will be competition from other advertisers for these keywords. Google uses the auction system so that advertisers can bid on the keywords to show their ad on the top. The Cost per Click varies for different keywords. It usually ranges from $0.1 dollars to $100 dollars or even more than that.
Google also has a variety of money making strategies and ideas in place for mobiles.
Google’s Mobile Strategy
Smartphone and Tablets have been used by the majority of the people in the recent years. The mobile search engine is also growing and experts are predicting that people will use their mobile devices as the primary source for accessing the internet. Google products and services are designed in such a way that it is friendly to mobile devices. Google mobile revenue stands at around $12 billion as of 2015.
Google has an advertisement platform especially for mobiles which is called as AdMob. Some of the Google mobile advertisement is powered by AdWords. You might have seen ads when you use some apps on your mobile devices. There are chances that they might have powered by AdMob.
Google, in turn, has a huge number of mobile apps for Android, Windows, and iOS phones. Some of the apps might be free and some might be paid, but these mobile apps also increase the revenue for Google.
YouTube and Google Play are other major Google Products which provide mobile content on a large scale. YouTube as you all know is the world’s largest video sharing site. Google has a very steady revenue stream from YouTube. Video ads, text ads, and subscriptions, all goes into Google’s pocket. Google Play is an online market store to buy apps and eBooks. Using Google Play, Google charges the developers for distributing their apps and products.
Even though Google has many products, services and business ventures, the majority of its revenue comes from Advertisements. Again, 70% of this ad revenue is from Google AdWords (that is, Google-owned web properties like Google.com, YouTube.com, etc.) and 30% from Google AdSense (partner networks and websites).
Google apart from being the world’s largest search engine, it also acts as a world’s largest advertising company.