Optimization Tips for Adsense

My regular readers know I am a big fan of ignoring prevailing wisdom and choose to experiment constantly in order to find my own answers. If there is one area where this approach has paid off nicely it's with Adsense. I have read numerous articles and comments from others who offer advice on this topic and quite frankly most of what you read is either wrong or misunderstood. To make money with Adsense you have to do two things; optimize your blog and each page on your site for a single keyword and then drive targeted traffic to that page. That second requirement would be better stated as "ONLY" drive targeted traffic to that page.

I want to take care of an Adsense myth right from the start.

"If you have a low CTR (click through rate) then you are probably smart priced."

This is absolutely wrong.

For those who don't understand smart pricing here is the basic gist.

If your Adsense ads don't convert well for the advertiser then the advertiser is only charged a fraction of the amount he or she bid for the ad placement. We are only talking about content ads here - the ads that show up on publisher's blogs and websites.

If you are running ads on your blog that an advertiser has bid $0.50 per click on and your traffic clicks the ads and doesn't convert well for the advertiser then Google will not pay you the usual $0.25 per click. They will likely give you $0.01 to $0.05 per click. This means you have been smart priced. This will also mean that you will receive lower payouts on every site you have Adsense on - not just the poorly converting site. This is a penalty because you are not optimizing your Adsense pages in order to give the advertiser the most bang for his or her buck.