September 06, 2004
Sweet Moolah

For several years now, I thought the internet money party had died or was at a minimum, pining for the fjords. I have been mistaken. The money party is rolling but the people at the party are trying to keep it quiet this time.

I've known for a while that this site gets visited by a significant number of people besides my mother and some people from work. For the last several months I've been bumping up against the 15 GB data transfer limit of my web host in the last week of the month.

Somehow my site even has a Google Page Rank of 7. Now this simply must be a mistake, because there are much better sites that rank lower. Again, this points to the fact that my site gets a goodly amount of traffic.

I had read that people could make some money by putting Google ads on their pages. You see them all over the place now on weblogs and other personal sites. But I simply assumed that you needed huge amounts of traffic to make anything more than pennies.

It seems I was wrong. You can make money and the party is rolling full tilt.

At the beginning of August I put Adsense ads on my site in a few places and was shocked to find myself making several dollars a day via the Adsense ads. This wasn't making sense to me and did a little research to find out what was going on.


It seems that internet advertising is mainly based on the click-through, or when someone actually clicks on a advertisement on a site and is taken to a new site. Seems straightforward, no?

Actually, Google put a twist on advertising by placing ads related to the pages content in as the ad. I don't know how they do it, but if you go to a page about travel, you will see Adsense ads about travel. Visit a page about computers and you'll see ads for computer parts. Advertisers want this. They want people that are interesting their product to be the ones that see their ads. Targetted advertising is what it's all about.

Google, being smart cookies, are letting the market set the price for ads. If you want your ad showing up on a page about online gambling, you bid a price you are willing to pay if someone clicks on the ad. Due to the competition to appear on the front page of a Google search, the price can get quite high. Making the front page can cost $4-5 per click. Supposedly the term mesothelioma (a kind of lung cancer that involves asbestos) can cost up to $100 per click.

So you can see that a single click on the right term, can bring in several dollars. Quite an amazing scheme if you ask me...


Now Google doesn't want people posting tons of statistics about their Adsense program, so I'll be general about the results. In one month I made over $100 from Adsense placement on some of my pages. Over more than 30,000 views of the ads, people were clicking only a couple percent of the time. Most people reach my site via Google and are not repeat visitors.

I know people that are making thounsands of dollars a month on ads, so my revenue is not that remarkable to people in general. But for me personally, an extra $100 a month for just having my web site up is fantastic. It's all funny money until the check arrives, but when it does, I'll be ecstatic.

I now understand why guys like Nick Denton and Jason Calcanis are into making niche websites and filling them with ads. They can make a ton of money!

Who know what the future brings, but the right now the internet money machine is cranking away and it has nothing to do with IPOs of start-ups.

Posted by michael at September 06, 2004 05:02 PM