How Does Google Make Money? Google makes the majority of their money from advertising. It is that simple. Google provides the best search results of any other search engine and as a result they attract web searchers. They then are able to show advertisements to these web searchers that are relevant to their particular search. Google also has a number of their own websites and web properties that users want to visit, such as YouTube and others and use Google uses these sites to show targeted advertisements to the users of those sites. These advertisements bring in the majority of Google’s income and profit. In fact, in the Google annual report they explicitly state that they generate their revenue by “delivering relevant, cost-effective online advertising.”

How does google Make money

In 2010 Google made 96% of its revenues from advertising. This advertising revenue is primarily sourced from Google’s AdWords program. Through this program an advertiser is allowed to place many different types of advertisements onto any of the Google web properties or the Google Network Members’ websites. These websites and web properties that allow Google advertisements can be anything from a small text ad to a full video commercial. The ads may be placed on the site, on a video within the site, or even onto applications used by mobile phones.

Google offers all types of advertisements to all types of companies that wish to advertise. They have inexpensive ads available to the smallest of companies and they have expensive advertisements available to the largest of corporations. The key element to Google is that they are able to allow the advertiser to target their advertisements to websites, web properties, or web searchers that are specific to and relevant to their product or service. This ability to offer advertisers a method of targeting their ads produces value for the advertiser and income to Google. This is also important in the overall marketplace because in the past advertisements were costly and not nearly as targeted as they are today. In the past you would have to place an ad in a magazine or newspaper and have it shown to many people not interested in your product. But with Google, if you sell purple crochet plant holders, you can target your ads to, and only pay for advertising to, people actually interested in purple crochet plant holders. This ability to segment targeted marketing combined with the ability to let businesses of all sizes compete directly has revolutionized advertising and is the secret answer to the question “How Does Google Make Money” .

How Does Google Make Money – Some answers

This secret to their income goes beyond their ability to deliver relevant and targeted ads. They bring users to advertisers through their own web properties and they bring thousands of website owners and their users to advertisers. The first part is that Google itself owns large websites with millions of users such as YouTube. They use YouTube to deliver advertisements paid for by Google’s advertising partners. Google also uses websites that they do not own to deliver ads to their advertisers. This is important to Google’s income. Their are millions of websites across the internet. If an advertiser wants to place their ad on a specific website it is difficult for them to contact every relevant site owner and negotiate a contract. But with Google, the website owner sets up a single contract and then Google places the ads for the Google advertisers. This way Google earns income, the website owner earns income, and the advertiser is able to easily get their advertisements to their target audience. This is a way that Google has created value in the marketplace and created income for themselves at the same time.

Therefore you can think of Google as a company that has access to internet users and as a result sells that access to companies that want those interent users to see their ads. Users think of Google as a search engine, but in reality that search engine is only made possible because it is paid for by the advertisements placed on that search engine. This is similar to a television show. The show is only made possible because of the advertisers that pay for it. The show actually exists for the advertisers to access viewers, just as the search engine only exists to allow advertisers access to web searchers. That is How Does Google Make Money