Google Adsense Adwords Arbitrage

Arbitrage is sometimes known as a "riskless profit". Website publishers are increasingly getting involved in Google Adsense Arbitrage to generate revenues.

Here's how the Adsense Adwords Arbitrage system works:

A company buys cheap ads (using a Google Adwords account) to drive users to their site where they write about topics that are likely to attract high-paying ads.

If a reader clicks on cheap ad to come to their site, and then leaves the site by clicking on an expensive ad, the website owner makes money on the difference, minus Google's cut.

But Adsense Arbitrage may not be the best way to generate income from Adsense. There are some risks involved that could eat your profits:

1. People who have already clicked on an ad are much less willing to keep clicking on more ads.

2. You will never get a 100% CTR - and every visitor exiting your site without clicking the "high-paying" ad will make you poorer by atleast 5 cents.

3. Even if you provide no exit routes other than adsense links, people may always close the browser window or type another URL in the address bar or click on bookmarks.

Of course, without advertisers' cash, this corner of the online-ad market could never flourish.

Google has also introduced a system of separate content bidding for Google AdWords. Advertisers can now choose to bid different prices for keywords depending on whether the ad appears on either the Google search engine or content sites. Previously, the single keyword bid by advertisers was applied to their ads on both search and content pages.

The move brings Google into line with Yahoo! that has run a similar dual pricing strategy for some time. It allows advertisers to compare the effectiveness of their promotions on the different mediums and vary the prices they are willing to bid accordingly. For example some advertisers might prefer to target content sites specific to the product they are selling while others may wish to attract potential buyers while they are still in the 'research mode' - i.e. when using the search engine to find product.

Google says that the new content bidding mechanism will be available to advertisers through the AdWords campaign management interface and is available to all advertisers worldwide. It also says the new service will not affect the site targeting feature, which is the tool that allows advertisers to target specific content sites in the Google network.