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With just over 70% of the search market Google dominates the world of internet search theses days. It is little wonder that a majority of internet marketers and entrepreneurs keep their eyes on whatever Google is doing today and speculate on where they may go in the future.

With the advent of Google’s two flagship money making endeavors, Adwords and Adsense, Google was not only able to become a multi-billion dollar company they also enabled the world of internet marketing to become a viable route for anyone who has the drive and willingness to make a good amount of money, many times replacing their normal income 3 or 4 times over.

What is Google Adwords?

Google Adwords is a pay-per-click advertising system that Google uses as its main source of income generation. In the pay-per-click system an ad is placed and appears for certain searched for keywords. The advertiser is charged every time his ad is actually clicked by a searcher. If the advertiser has done his work right this click will turn into a sale which should more than offset the cost of the click.

The nice thing about the Google Adwords advertising system is that an advertiser’s ads can run continuously and cost very little money. It also makes it easy to place ads that are very specific to whatever the product is and thereby further limit the cost.

How does Google Adwords Work?

Google Adwords is an auction type system. Advertisers bid on keywords that they believe will bring buyers to their web pages. The higher the bid the higher up the Adwords listing that advertiser’s ad will be placed. There are a couple of other criteria besides bid amount that affect ad placement as well.

One is the click through rate of the advertiser’s ad. Also known as CTR this is the percentage of clicks an add get in relation to how many times it is shown for that keyword search. The higher the CTR the higher an ad can rise in the listings. A high CTR can also help lower bid price.

The other important criteria are the quality or relevance of the web page the ad is pointing to. This “Quality Score” is assigned by Google through their search algorithm. It is believed by many experienced internet marketers that the quality score is based on how ell the content of your web pages matches with that of the keywords they are bidding on and the ad copy itself.

Where do the Adwords Ads Appear?

If you d a search on Google you will notice that on the right hand side of the page there are eight “sponsored listings”. These are the Adwords ads. If you find one that interests you and you click on it, it will take you to some sort of web page, usually to a product that you can buy that is specific to the search you did. When you click on that ad Google charges the advertiser for that click. This can be anywhere from 5 cents to more than 50 dollars.

This is where “Return On Investment” (ROI) comes into play. The idea with Adwords is to make more from the sale of goods than what it costs to advertise. A good marketer can easily obtain an ROI of 200-300%, or for every dollar they spend they get 2 to 3 dollars in return.

Affiliate Programs and Google Adwords.

An affiliate program allows just about anyone the opportunity to make money using Google Adwords. Quite simply an affiliate is a sales person for someone else’s products. With Google Adwords an affiliate can place ads that link to a merchant’s website. If this merchant is part of an affiliate network or has an affiliate program the affiliate get a percentage of anything they sale via their Adwords ad.

There are quite a few affiliate networks on the internet today that list tens-of-thousands of merchants and their products. It is easy to sign up with most affiliate networks and begin promoting the merchants who they represent. One could, if they were very motivated sign up with several merchants and have ads up and running in one day. This is not the recommended way to start as an affiliate but it does show how easy ads can be placed once you get the hang of it.

At the end of the day, Google Adwords is a viable tool that can be used increase traffic to one’s e-business. By minimizing irrelevant clicks and targeting those who are truly looking to purchase a product or service, an internet marketer can assure the profits they collect would be much greater than the costs they have to pay for each click on their Google Ad.