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How Much Does Google Make On Paid-Search Keywords?

LarryKim

Ever wonder about the most searched-on and expensive Google AdWords keywords? Google generated about $32.2 billion during the past year in total advertising revenue, and about 97% comes from advertising on Google sites. WordStream founder Larry Kim has served up a list of the keywords and industries where Google makes its money and provides advice on what search marketers can do to ease the pain.

The volume on these keywords enables Google to bring in the bucks and not just generate clicks -- although those clicks can get expensive, especially when winning the top bid for popular keywords and phrases. Kim said Google can make up to $50 per click. WordStream's research factors in the estimated search volume and cost per click (CPC) per keyword or phrase.

Insurance at $54.91 for the top CPC takes the No. 1 spot in Kim's list for the most expensive keywords in Google AdWords advertising. The top sample search queries include "auto insurance price quotes" and "ca automobile insurance." Loans take the No. 2 spot at $44.28 for phases such as "consolidate graduate study loans" or "fixed home equity home rates."

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Mortgage comes in at No. 3 with keywords such as "refinanced second mortgages" and "remortgage with bad credit." Attorney follows at No. 4; Credit, No. 5; Lawyer, No. 6; Donate, No. 7; Degree, No. 8; Hosting, No. 9; and Claim, No. 10.

These are all areas where there's no monopoly and they are not strongly branded. These high-priced words and phrases are related to things people need, but don't know where to find, Kim said. For example -- needing an attorney after an accident, but not knowing who to call. "At first 'cord blood' ranking high didn't make sense to me," he said. "Then I looked into it and found the keywords related to stem cell research."

Cord Blood at $27.80 per click comes in at No. 20 on Kim's Top 20 list. Two of the frequently searched phrases include "cordblood bank" and "store umbilical cord blood."

There's a high cost for harvesting the stem cells for the cord blood. People want to save the blood in the event that the cells are needed in the future to heal a disease they might not know they have. There's an ongoing fee to store the blood indefinitely.

So, what can marketers do to get the most from online paid-search budgets? 

1) Be picky and precise: Focus on specific keyword phrases. Marketers selling life insurance or in a particular location should leverage related modifiers. Use keyword-match options, phrase matches and exact matches to help Google serve up ads to the correct searchers.

2) Leverage negative keywords: Exclude certain terms that are not relevant to the specific business. For example, marketers that do not sell motorcycle insurance should take advantage of negative keyword tools to find and eliminate the words and phrases Google might match to the keywords. Each click costs marketers money, so it's important to optimize budgets by eliminating wasted clicks.

3) Watch pricing and landing page optimization: The average conversion rate for most keywords on AdWords is roughly 2%. But Kim notes that landing pages convert between 20% and 30%. Testing becomes the key to landing page optimization to determine how people respond.

  Where Does Google
Make Its Money? [ infographic ]

1 comment about "How Much Does Google Make On Paid-Search Keywords?".
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  1. Elliot Mann from AC Lion, July 20, 2011 at 9:17 a.m.

    Can’t stress the importance of conducting a proper Boolean search can you?

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