How Google make money ?

Everyone (or at least, nearly everyone) knows that Google makes money through advertising on its search engine. But how do they do that exactly? And what about all its application that does not seem to have ads on it ?

Search engine : AdSense - AdWords / Click-to-Call / Pay-per-action / Acquisition

Google.com earns most of its profits thanks to a program called AdWords.

How? By allowing other website owners to advertise on their search result pages. Advertisers pay only when an ad is clicked (called cost-per-click or CPC)

In order to be more present (to have more ads), Google has developed a program called AdSense that proposes to website owners to earn a share of its revenue from AdWords by displaying these same "sponsored links" on their site.  In other words, you're helping Google advertise and they pay you a percentage of what they earn thanks to you. 

Another online "experiment" of Google is the Click-to-Call service that allows internautes to initiate a phone call to an advertiser when a telephone icon appearing next to a text ad is clicked. 

Or "pay-per-action" advertising which is a new pricing model that allows advertisers to pay only when specific actions (such as making a purchase) are completed by a user on their site. --> Only pay for ads that works !

Moreover, Google is also expanding beyond online search advertising and is broadening its offerings to marketers. In 2006, Google acquired dMarc Broadcasting and Youtube. The first one is a radio-advertising firm that provides an automated system for purchasing radio advertising. The second one is the most visited Web site on the Internet.  One year later, Google also acquired DoubleClick, the industry leader in providing technology and services for placing ads on Web sites. 

During this same year the company launched Google TV Ads which is an online platform fo buying, selling, measuring, and delivering television commercials. The goal is to provide advertisers with more detailed and accurate information on how many people are viewing TV commercials and who these people are. 

By collecting those marketing data Google can sell them or using it for targeted advertising. 

The former way (of course still used) is to charge Web sites to become listed in Google search engine and for better placement in this list, or charging them for the purchasing of keywords for themselves. 

What about the applications of Google ?

Google has developed its applications for three reasons : 

1° To collect more marketing data on people in order to better target them and to increase the probability that those people are going to click on an ad. 

2° To put more advertising. 

More Google products = more time spend on google pages = more exposure to Google ads. 

A good example is Google Maps. For example, when tapping "The Skyline Hotel, NY", Google locates the hotel, gives us information about it such as the phone number and the official Web site, but Google also offers the possibility to book a room online at the best price!

3° To associate people with the brand, creating a positive brand image. "Google enables you to do anything on the Internet thanks to Google Maps, GMail, Google Agenda, Google Documents, Google Groups, Google Chrome, Picasa, Sketch Up, google News, Orkut, Blogger, ...  either for a business use or for personal use.