Where Does Google Make Its Money? New Research Reveals Most Expensive Keyword Categories in Google AdWords
BOSTON, MA – July 18, 2011 – WordStream Inc., a provider of search marketing software, unveiled new keyword research data that reveals the top 20 high-volume keyword categories that fetch the highest costs per click in Google AdWords pay-per-click advertising, or PPC. Following up on Google's recent announcement of its Q2 earnings, these high-CPC keywords reveal where Google is making the majority of its profits. The full report is illustrated in an infographic of the most expensive keywords.
The top five keyword categories that demand the highest costs per click, thereby netting Google the most money, are:
- Insurance (example keywords in this category include "auto insurance price quotes" and "buy car insurance online")
- Loans (example keywords include "consolidate graduate student loans" and "cheapest homeowner loans")
- Mortgage (example keywords include “refinanced second mortgages” and “remortgage with bad credit”)
- Attorney (example keywords include “personal injury attorney” and “dui defense attorney”)
- Credit (example keywords include “home equity line of credit” and “bad credit home buyer”)
WordStream’s findings reveal that 97% of Google's revenue comes from advertising on Google sites. In the last four quarters alone, Google made $32.2 billion in total advertising revenue.
WordStream compiled data from its own trillion-keyword database and the Google Keyword Tool to determine the top 10,000 most expensive English-language keywords over a 90-day period. This keyword list was then organized into categories by theme. The largest keyword categories were determined by weighting the number of keywords within each category, as well as the estimated monthly search volume and average cost per click for each keyword.
Some interesting conclusions can be drawn from this keyword data:
- Google AdWords is a dynamic, auction-based marketplace where advertisers bid on keywords to compete for top ad placement. The minimum bid per keyword is 5 cents, but this research shows that in highly competitive categories, Google can make up to $50 per click. Despite a diversified product portfolio, advertising on Google sites accounts for the vast majority of its billions in annual revenue.
- The keyword categories with the highest volumes and costs represent businesses with very high lifetime customer value – in other words, these industries can afford to pay a lot to acquire a new customer. These businesses include lawsuits, mortgage applications, and server hosting. Some high-volume keyword categories have lower CPCs because advertisers have slimmer margins to expend on PPC advertising.
- It’s no surprise that Google has rolled out product comparison ads in the loans and mortgage keyword verticals. We expect Google to release more of these and similar innovations in the other top keyword categories identified in our research.
Visit the infographic for the full list of the top 20 most expensive keyword categories and to learn how Google makes money.
Recently named an “OnDemand Top 100 Winner for SaaS” by AlwaysOn, WordStream provides Internet marketing software that helps search marketers get better results from their PPC and SEO efforts. The company’s easy-to-use software facilitates more effective paid and organic search campaigns by increasing relevance and Quality Scores in Google AdWords, automating proven best practices, and delivering expert-level results in a fraction of the time. WordStream also offers PPC services including PPC training, AdWords account tune-ups and full-service PPC management.