How Does Google Make Money?

When you look at the beautifully blank home page at google.com, you might ask yourself how does Google make money? Google makes money in a variety of different ways – but over 97% of the annual revenue – some 33 billion – is made through advertising in their search results. When you search for something like, “Tulsa Real Estate Agent,” you will get two sets of results. The top three results, for the most part, are paid ads. Google Ads as they are called, are ranked on a Cost-Per-Click basis, or CPC. So, what search terms cost businesses the most money when their competitors sat and clicked on them all day….

1. Insurance – $54.91
2. Loans – $44.28
3. Mortgage – $47.12
4. Attorney – $47.07
5. Lawyer $42.51

To some the idea of paying almost $55 a click seems ridiculous. Keep in mind, these are averages and obviously something like an attorney is going to have a location attached to the search terms. That being said, you can believe that Attorneys in New York and L.A. are paying much more money then $55 per-click. In fact, I have personally watched two companies get in a bidding war over the top paid advertising spot. At one point, the two companies were paying close to $120 per click. And every day, each ad gets close to 20 to 30 hits. Hmmmm… how does Google make money?

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