News: 1/3 Of AdWords Dollars Are Spent On AdSense!

Author: Gab Goldenberg

http://investor.google.com/earnings/2011/Q1_google_earnings.html

“Google Network Revenues – Google’s partner sites generated revenues, through AdSense programs, of $2.43 billion, or 28% of total revenues, in the first quarter of 2011. This represents a 19% increase from first quarter 2010 network revenues of $2.04 billion. ”


What’s interesting to note is that roughly 70% of that goes to AdSense Publishers.
That’s based on Google’s statement regarding Traffic Acquisition Costs (TAC):

“The majority of TAC is related to amounts ultimately paid to our AdSense partners, which totaled $1.70 billion in the first quarter of 2011. TAC also includes amounts ultimately paid to certain distribution partners and others who direct traffic to our website, which totaled $337 million in the first quarter of 2011. ”

In a similar vein, average CPCs are up 8% year-over-year from Q1 2010 to Q1 2011. Yet another reason big PPC investors get fed up and eventually seek SEO services…

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Comments

  1. Wow! these are very interesting numbers Gabriel. From what I can see with my clients accounts, the average CPCs are increasing very quickly indeed. Many competitors from all the fields are getting in the Adwords game, making the first few ad positions more expensive everyday. That might make them think twice before saying no to SEO... :-)

    Comment by Jonathan Villiard - April 21, 2011 @ 8:30am
  2. What's the average CPC increase been like in your fields, Jon? Can you break it out by industry?

    Comment by Gabriel Goldenberg - April 24, 2011 @ 9:36am
  3. For small businesses (dentists, plumbers as examples), the rise has been up to 30%. Local competitors are now investing in Google Adwords, raising the CPCs. For big international companies, the rise I see is around 10%, maybe because most big companies are buying these Adwords ads for years now, with less new competitors. These are just guesses though, I don't have data from hundreds of companies or fields to confirm a trend...

    Comment by Jonathan Villiard - April 24, 2011 @ 8:55pm
  4. Wow, that's remarkable Jon. My friends are also in local and I think I've heard similar things too because it's hit the tipping point so everyone's getting into it now...

    Comment by Gabriel Goldenberg - April 26, 2011 @ 11:09am

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