How does Google make money? | Simply explained
In this post you’re going to learn How does Google make money.
In 2018, Google accounted for the majority of parent company Alphabet’s revenues with 136 billion U.S. dollars in Google website revenues alone.
And today I’m going to show you how I did it…
Google is a free search engine. Still, it makes huge profits and lists among the top earning companies in the world. Many wonder how and are in search of answers for the same. I think my research on the topic helped me come out with a few big ways the giant search engine is making money. Let’s have a look at them.
The services of Google are free, but it makes huge money because its product is you, I mean the user. It has a good grip over the search market across the world, and most of its revenue is generated from advertising. There are still many sources where the revenue is generated for the search engine.
This are the 14 ways how google makes money
Google Adwords advertising
When you are using the search engine to find any related information whether local or international, Google displays the most relevant information on search results for your queries with the help of algorithms. Along with the search results, you will also find related pages that display needful information from the Adwords advertiser too. This integration touches every Google property like youtube, Maps, Gmail so, any recommended website you visit when logged into these Google properties will generate income for the search engine.
Advertisers bid money for gaining top spot in the search results. The highest bidder is displayed on the top of the search results in relevance to your search query, and low bids may not even get displayed in the search results. Google auctions these bidding prices for high competitive keywords. To conduct a good auction, Google uses a Vickrey auction system where rivals bids are not displayed during the auction, and the highest bidder wins the top place. The top bidding price for the click can be as high as $50 depending on the sectors you are advertising your business in. The search engine also considers quality score while considering the bid price. The advertiser who has a landing page on “ car insurance “ can bid less for the search query about car insurance when compared to the advertiser that has a landing page on general insurance.
Cost per each click
The service is all about gaining the attention of the users that have already have expressed interest in advertiser’s product. This is called target advertising/ contextual advertising and promises high conversions for the advertiser. The advertiser pays money for the search engine for each click they receive on the ads bid displayed. They also have an option to limit their monthly spend on bidding expenses.
Though cost per click remains a major source of Google income, it also earns from advertising when you are not on one of its properties. The ads are displayed on sites that have large content and a lot of traffic. The Adsense helps the search engine to earn money by displaying ads on other websites.
This is the second good stream of income for Google. If you are running a blog or news portal with high traffic, you can apply for Adsense account and partner with the search engine to earn some income. Targeted ads will be displayed on the website you are running, and you can decide where the Adsense has to rest on your website. Each the visitor clicks on these sponsored content, the search engine generates income and shares with the website owner. This creates a win-win situation for both search engine as well as the website owner.
Check out : WAYS TO MAKE MONEY FROM YOUR BLOG
Not only for searching relevant information, but Google also remains a trusted brand for many other services too. It provides Maps, cloud computing, social network, and email services to the users. Though these paid services of Google stand on the expensive side, they help to draw more users and grab more vital data about the users.
Google earning through youtube
Not to be surprised that youtube is the largest video and audio streaming platform in the world today. The product is owned by Google, and it tends to be one of the good sources of income for the search engine. It is reported that youtube has 1.8 billion Monthly Average Users and is creating 13 billion videos catering the needs almost every youtube user. Over 300 hours of new videos are uploaded every minute on the youtube which shows ever increasing the popularity of Google’s product.
Here also Google earns money by displaying feature ads on each video streamed by the users. Here the video displays are again targeted on the user search interests to make the most of it.
Sure you must have watched some videos on youtube, the targeted advertisement on the youtube starts even before you watch the intended video. Also, some ads are played in between the videos. They are also displayed on sides of the video as bars and banners. The search engine offers the advertiser different levels of subscription, and it remains at your discretion to fix the budget and type of audience you wanted to reach through advertisement.
Irrespective of having your business video or not, there are ways in which youtube can help you make an advertisement that fits in your needs.The advertising for youtube starts at $10 per day for local advertisers. If your reach is global, you may have to pay more.
Check out: HOW TO MAKE MONEY FROM YOUTUBE
This service from Google turns on a bit expensive side. The premium subscriber has to pay $11.99 per month to watch their favorite videos. Using this service, the user is free from ads to display in the background and download videos and music of their choice.
Android by Google
Most of us would be surprised to know that Google operates the Andriod system. This turns to be a money spinner for the search engine from smartphone users. They have locked horns with the technology giant Oracle over Android development. It gets money for the ads displayed on Android-powered smartphones across the world. It also earns money by selling paid apps on Google play store on android phones.
This is the digital wallet launched for the users of Google in 2018. It works on Android-powered smartphones and variable devices. It is in running use across 30 countries in the world. Though it is yet to disclose the revenue generated from Google pay, it is a countable source income for Google. It earns money by charging a small fee from the merchants that allow users to pay money through it. It also makes money through app advertisements, and even banks do pay some fee for Google for providing good and easy connectivity with the customers.
Google offers a range of paid software for laypersons and developers. It can be anything from encryption to monitoring. The most popular software of Google is earth premium Google Merchant Center and Google Manufacturer Center and Google Certified Shops.
This is a wonderful product from Google for the business owners. This enterprise solution has established a brand in cloud computing and collaboration.
It helps the users to connect to the head office from the remote location. It also includes the features to streamline your business operations like video conferencing and storage of large files. These are paid services. It also makes money by offering G cloud services to many business organizations at a monthly subscription fee.
Apps & Google Play
The search engine is known to make a lot of money through the apps on the Google play store. If you are an app developer, none other than the Google play store will be an excellent platform to reach a lot of users. The money generated through the app store turns two ways here. The developer who wants to sell their app to the user pay a small fee to Google for using the service and it all depends on how the search engine promotes the app and number of downloads happen.
The second way of generating income is by displaying in-app advertising using Google ads. Advertisers pay the search engine for every ad displayed and for the app download from the play store.
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This is the product of Google that is almost used by everyone today. It comes handy when you want to find the nearest restaurant or know the traffic on your way to the destination. It also helps you with the route map to your desired destination. Though this service seems to be free for normal users, it is chargeable business organizations and governments using it. It also earns money by allowing the advertisers to flash an ad while you are on the drive using the maps.
The cloud services from Google offers a wide range of solutions for the businesses apart from the cloud service, and this includes artificial intelligence to data analytics. They have an impressive lineup of clients using Google cloud services and guessing the way it makes money from the service is not a tough play.