Adsense & Adwords: A Beginners Guide

First a brief glossary of terms:
Adwords: The program advertisers use to make their adverts.
Adsense: The program Website owners use to display the adverts
CTR: Click Through Rate (the number of page impressions/the number of clicks on a advert)

The most effective methods of advertising on the internet are Google's Adwords program and Overture which is now officially called Yahoo Search Marketing but still universally known as Overture. This method of advertising is called Pay per Click or PPC. The concept is incredibly simple; Google and Yahoo provide listings on a Per bid basis. You bid a certain amount of money for your specific keywords when someone types in a keyword and you have the highest bid then your advert shows up. On Google the adverts show up in the Adwords column on the right hand side of the page whilst Yahoo shows them as sponsored links at the top of the page. If someone then clicks on your advert, they arrive at your web site and you are charged the amount you bid. So, for example if you bid $.10 per click on 'widgets', and that's the highest bid, you'll show up at the top if It's the second highest bid you'll show up second etc. If 100 people click on your advert, then the search engine or PPC service will charge you $10.00.

Using Adwords to your Advantage

So now that you know how Adwords work you can use this to your advantage when building websites. If you build a site about a specific subject you can then use specific keywords to attract adverts. The best way to ascertain which keywords to use are by signing up for an Adwords account you will then have access to Google