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What percent of google's revenue do you think comes from adsense?
Do we make a difference?
mallu




msg:1356512
 8:06 am on Aug 14, 2003 (gmt 0)

To repeat,

what percent of google's revenues do you think comes from adsense?

I would say 10%, 5% from premium members and 5% from us.

What do you think?

 

irock




msg:1356513
 10:34 am on Aug 14, 2003 (gmt 0)

I don't think there's a lot... here's my thoughts...

I would guess HUGE money-making sites only account for a very small amount of the useful web content (they all have duplicated content).

The rest of the website owners make the bulk of the useful web content, but unfortunately, most of them aren't making money. I believe Google is trying to encourage these publishers to 'get back to back' on their informative, yet outdated, site with the monetary reward. Eventually, all our pages combined with AdSense would create a huge branding effect for Google, not to mention that we'll spread words that Google is a really cool company that also looks after small sites. Profileration of sites that adopt AdSense will also send a message to AdWords advertisers that they can sell to a broader, more targeted audience group.

Sorry, TOO off topic I think...

And my answer would be 'decent' percentage of Google's revenue, but I doubt money isn't really GOogle's after in the AdSense project.

Visit Thailand




msg:1356514
 10:47 am on Aug 14, 2003 (gmt 0)

I think it would be impossible for anyone to guess but I am guessing they are making a lot of money from it. When you think some sites are earning mega bucks from running AdSense on their pages and others good money and from the sounds of it others who earn sufficient to make it worthwhile then multiply that by a few hundred thousand if not more.

If Google manages to get this to work properly it should I would imagine be one of their major earners.

Denis at eVR




msg:1356515
 1:04 pm on Aug 14, 2003 (gmt 0)

I think the numbers could be quite large overall. My business partner's site, which isn't much more than a 'pocket money' venture, is currently earning him several tens of thousand dollars a year from AdSense (at least, that's what he tells me!). If, for example, the split was 50:50, then Google are earning the same amount fom this site, too. It doesn't take a lot of sites like this to add up to a huge amount of money in total.

loanuniverse




msg:1356516
 1:50 pm on Aug 14, 2003 (gmt 0)

I think that in order to figure out how much revenue Google makes from Adwords as a whole and from the Adsense portion of the program, you have to start making several assumptions such as:

1-Google serves 240 million searches a day and gets to put adwords in all of its SERPS. (This is a little iffy since I am not sure if they count the searches served by Yahoo as part of their searches).
2-The average user looks at an average 1.2 Search Engine Result Pages.
3-The average CTR in the Google SERP for adwords is 2% (Conservative since they require a 1% just to keep the darn campaign active).
4-The average click is worth $0.20
5-Adsense is providing at least as many impressions as SERPS.
6-CTR for Adsense is about 1%.

Then we can deduct that from the search engine you get:

240,000M searches X 1.2 pageviews X 2% CTR = 5,760,000 clicks
5,760M clicks X $0.20 X 365 days = $420,480,000 annual revenue

From Adsense you get:

288,000M impressions X 1% CTR = 2,880,000 clicks
2,880M clicks X $0.20 x 365 days = $210,240,000 annual revenue

Total program = $630,720,000 annual revenue, which I think is higher than Overture. However, I am probably counting some search engine impressions that Google can not put adwords on and probably underestimating or overestimating CTR and average bid.

Just remember that revenue is only half the battle, traffic acquisition is a very important number. For example, Overture’s expense for traffic acquisition, according to their latest 10Q, is around 64% for the first six months of 2003 up from 54% during the same interim period in 2002. One would think that traffic acquisition for Google will be anywhere from 50% to 65%. I figure that much because of the prevalent $0.03 clicks, which can be deducted to mean that $0.05 bids result on payments rounded up to $0.03 for the publisher.

Disclaimer: This quick and dirty analysis was done in 5 minutes, given more time to break down Overture’s filings and get information on Google traffic, I could come up with a closer number.

richmondsteve




msg:1356517
 7:08 pm on Aug 14, 2003 (gmt 0)

288,000M impressions X 1% CTR = 2,880,000 clicks

loanuniverse, I realize you made a lot of assumptions and the purpose of my reply isn't to challenge them, but it seems you made an assumption that you didn't list. You assumed 288 million SERPS (assumptions 1 and 2), but your calculations used the same # of impressions for AdSense with no assumptions listed. I suspect that the AdSense impressions are a fraction of that. Do you disagree?

Also, AdSense and Adwords are not Google's only sources of revenue.

universetoday




msg:1356518
 9:01 pm on Aug 14, 2003 (gmt 0)

I was looking at a friend's Adwords account which showed how much they were spending through Adwords and Adsense, and the Adsense amount was a fraction of what they were doing through Adwords - like maybe 5%. So, I don't think the Adsense revenue is up anywhere near as high as Adwords yet.

loanuniverse




msg:1356519
 9:04 pm on Aug 14, 2003 (gmt 0)

richmondsteve:

Take another look at assumption #5 for the answer where 288 million adsense impressions came from.

Also, AdSense and Adwords are not Google's only sources of revenue.

Yeph, I am aware that they must be getting paid from Yahoo and from AOL to provide the SERPS. I am sure there are other smaller revenue streams such as the google search box that they sell to institutions, but I am sure that the biggest by far source of income is and will be adwords.

Universetoday makes a good point... My own {very very modest} adword account shows only 5% of the impressions shown in partner sites so I might have jumped the gun on that one :)

richmondsteve




msg:1356520
 2:21 pm on Aug 15, 2003 (gmt 0)

loanuniverse, I'm not sure how I missed that assumption. At this early stage I'd guess that Adwords revenue dwarfs Adsense revenue 20-50:1, but it's reasonable to assume that Adsense revenue will grow at a much faster pace than Adwords revenue for the near future.

In addition to the revenue streams you mentioned, Google also offers several paid custom search services, the Google Search Appliance, etc. I have no idea how much those generate.

loanuniverse




msg:1356521
 5:26 pm on Aug 15, 2003 (gmt 0)

At this early stage I'd guess that Adwords revenue dwarfs Adsense revenue 20-50:1, but it's reasonable to assume that Adsense revenue will grow at a much faster pace than Adwords revenue for the near future

Agreed, I think that 20:1 sounds about right, but 2:1 is achievable by the end of the year as long as more sites get on board.

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