In February last year Google briefly surpassed Apple. For a while they were the most valuable company in the world.
Google gains most of its revenue through search, but how can this be, when it’s a free platform to use?
This is a question that many may have wondered about and a question that this blog post will help clarify.
Google has a yearly revenue of 520 billion dkk (£61 billion) having a 160 billion dkk (£19 billion) operating profit. It is reported that Google earns 15.000dkk a second. Where in the world does this revenue come from?
Out of these 520 billion dkk (£61 billion), 469 billion dkk (£55 billion) come from advertising. Compare Google’s yearly revenue to Coop, a wholesale distributor, who has a yearly revenue of 187 million dkk (£22 billion).
It is through advertising on Google Search and adverts served by Google on other websites, that Google earns most of it’s money.
But how does the Google Search system work? We have broken it down into three factors: keywords, bid and relevance.
Having a high relevance, together with the highest bid (which, as explained above, is reliant on the relevance of your website), will make the advertisement show on top of the Google Search page, where users will be more likely to see and click on it.
What makes this service that Google provides so attractive, is that you can target your ads to users on Google who have shown an interest in what you offer, and ignore those who haven’t.
Besides this, advertisers only pay for their ads when someone actually clicks on the paid ad. If they don’t it’s free brand awareness. But don’t worry, it is possible to set a budget in order to control the daily or monthly spend.
Since its release in 2000, Adwords has been Google’s primary source of revenue. Another revenue source is Google’s Adsense network, where your advertisements can be placed on partner sites. These include everything from blogs to newspapers, where you don’t just advertise with text (which is the case of Search advertising), but have the option of utilising images, videos, audio etc. Google has millions of partner websites and this increases daily, thereby having an extremely broad reach. This is called Display advertising.
To sum up, Google Search is the perfect way for you to reach customers who are searching for what you are offering. You can choose not only to utilise Google Search, which has been explained in this article, but also Display advertising – where you show your adverts on other websites to which Google is a partner – thereby gaining an even stronger online presence.
Customers want relevant information and to find what they are actually searching for, so why not give it to them?
A lot of people are utilising Google AdWords and have gained from it – why aren’t you?
Are you considering grabbing this opportunity and want to speak to us?
If you are in Denmark give us a call on +45 78 76 92 05 or meet us in our office at SOHO, Kødbyen.
U.K. team on +44 203 005 9878 based in London.