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What does Google pay YOU?
IPO filing reveals some sites are paid more that 100 percent...
258cib

10+ Year Member



 
Msg#: 2423 posted 12:45 pm on Apr 30, 2004 (gmt 0)

[cbs.marketwatch.com...]

Now we know.

What a wonderful insight on my last day in the web biz--Google was paying some publishers for their listing.

(BTW, this jives with the experience I has with a contextual linking ASP I tried to market to news publishers. Overall clicks, with very high relevance, was only 2.2 percent of traffic on news articles.)

from Bambi Francisco's Net Sense column today
...,Google revealed that 80 percent of the $961 million in sales it generated last year came from its site alone. The other 20 percent came from other Web sites that use Google's ads and send traffic Google's way.

Google also said: "Typically, in situations where we pay a Google Network member more than the revenue we receive from our advertisers in connection with paid clicks on that Google Network member's web site, we recognize the difference as cost of revenues."

Google didn't disclose which of its distribution partners are getting
that "more than the revenue we receive" payment. But many analysts
speculated that some distribution partners were receiving 80 to 90
percent of the revenue generated from the traffic they sent to Google's
advertisers. Now we know it's more than 100 percent in some cases.

Conclusion: Even with Google's monster-huge volume of ad placement on other web sites via Adsense, it doesn't make them that much money. Adsense has mostly been a marketing campaign to build the Google brand.

If you're making money with Adsense, great. But, as you build around it keep in mind that the program is a small part of Google's enterprise. Of course, if you're depending on it, you're not alone.

Or, as Bambi says:
Now that Google admits to giving away some revenue and says it generates 80 percent of the sales on its own site, it doesn't seem Google needs to improve the economics between itself and its partners.

One has to wonder why some search engines, therefore, trade at a premium when they rely so heavily on a company like Google, which clearly has a lot of leverage.

I encourage you to read her entire column.

 

loanuniverse

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 2423 posted 1:00 pm on Apr 30, 2004 (gmt 0)

...Google revealed that 80 percent of the $961 million in sales it generated last year came from its site alone. The other 20 percent came from other Web sites that use Google's ads and send traffic Google's way....

I don't think Bambi is taking into consideration the way that Google is accounting for revenue. Google is only taking into consideration the revenue that it doesn't have to share with publishers {large and small}. Adsense revenue that was contextual {not search as AOLsearch is} accounted for at least $200MM during the first Qtr. of 2004 {IMHO}. Taking into consideration that their cut is probably around 30% to 40% of that number, we are talking about a net revenue stream of about $60MM a Qtr. {or $240MM on an annualized basis}.

Not small potatoes in any sense.

Macro

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 2423 posted 2:02 pm on Apr 30, 2004 (gmt 0)

There have been a million discussions here on what percentage of their revenue Google was sharing.

I don't believe anyone ever guessed it could be over 100! :)

Sanenet

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 2423 posted 2:20 pm on Apr 30, 2004 (gmt 0)

I can't believe that the "little" guys are getting over 100% of the revenue from Adwords.

Far more likely (IMHO) that the split is around 60/70% for the small guys, and goes up depending on site traffic. I'm sure that some of the larger "preffered" members would make that, just to tie them into the program.

So - lets settle back and await the first "when will Google cut the revenue share" postings!

tomkee

10+ Year Member



 
Msg#: 2423 posted 2:21 pm on Apr 30, 2004 (gmt 0)

I think paying more than 100% is the exception and not the rule. I cant believe google is paying me as much as it is just for the little extra publicity I can give it.

CPCretirement

10+ Year Member



 
Msg#: 2423 posted 2:46 pm on Apr 30, 2004 (gmt 0)

I'll have to go read the specifics again, but from what I remember Google said something along the lines of not always being able to acurately predict how much revenue they will get from a partner therby resulting in some cases where they pay out more to the partner than they bring in from clicks.

This implies to me that in some cases it's not a straight percentage split but rather has some fixed portion to it. Otherwise you could predict your margins.

europeforvisitors



 
Msg#: 2423 posted 3:05 pm on Apr 30, 2004 (gmt 0)

This implies to me that in some cases it's not a straight percentage split but rather has some fixed portion to it. Otherwise you could predict your margins.

A guaranteed minimum and/or a CPM deal could result in Google's paying too much for a premium partner's traffic (at least in the short term).

jomaxx

WebmasterWorld Senior Member jomaxx us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 2423 posted 3:06 pm on Apr 30, 2004 (gmt 0)

Isn't it a known rumor that preferred partners are paid on a CPM basis? Presumably that is how Google can end up earning less in clicks than it pays for exposure. That makes more sense than paying 100% on the kind of CPC basis that regular AdSense publishers experience.

Now that I think about it, they also run AdSense ads on banner networks. Whether they pay CPC or CPM, the cost is probably negotiated in advance.

[Too slow - EFV slipped in ahead of me with the same observation]

yump

10+ Year Member



 
Msg#: 2423 posted 3:12 pm on Apr 30, 2004 (gmt 0)

A marketing campaign that makes money at the same time as brand promotion. Now there's a business model to copy...or actually suppose its already done offline ie. pay more for branded sweatshirt and also show off the logo...

Jenstar

WebmasterWorld Senior Member jenstar us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 2423 posted 3:11 am on May 4, 2004 (gmt 0)

Some premium publishers earn on a CPM basis, but most earn on a EPC basis like regular publishers.

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