Forum Moderators: martinibuster
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?
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 I believe Google is trying to encourage these publishers to 'get back to back' on their informative, yet outdated, site with the monetary reward.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.
If Google manages to get this to work properly it should I would imagine be one of their major earners.
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.
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.
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 :)
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.
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
