Who said Adsense Arbitrage is Dead?


Tired of Making Chump Change Online?

There was quite a storm in the blogosphere a few years back when Google decided to crack down on Adsense arbitrage.
Here’s some good news: arbitrage is still alive and kicking. It is doing quite well, actually. Also, it is monetizing
a traffic source that is poised to get even BIGGER than search engine traffic or search engine-based PPC like Adwords
or YPN or Microsoft’s ad network. We’re talking about arbitrage on FACEBOOK!

Quick recap: Adsense arbitrage involved two parts: 1) buying ad placements for keyword searches on Adwords and 2) setting
up a page with adsense ads. The business model is very simple: buy low-priced search terms at Adwords for pennies a click and drive
them to pages running adsense ads that trigger higher paying ads with similar keywords in the same category. You make money on
the difference between the per click price you paid on adwords and the per click price you were given on Adsense.

The problme Google saw is that most of these advertised arbitrage sites are very shallow and featured very littel real content. Indeed, most were quite ugly pages consisting solely of a few bits of content (to trigger higher paying keywords) and of course, adsense ads. While google did take proactive steps of dropping the hammer on the biggest (and most lucrative) “abusers” of this system by killing their adsense accounts and/or adwords accounts, Google truly nuked the adsense arbitrage game when it increased its use of the Adwords Quality Scoring system.

The Adwords quality score system assigned a value to ads placed in the adwords system automatically. This score influenced how much the advertiser paid per click. Since the most effective arbitrage pages had very little content and hence, “quality”, it quickly became prohibitively EXPENSIVE to run an adsense arbitrage campaign.

The veterans of this game currently use the following “work arounds”:

a) Build high value content rich sites. This inflates the adwords quality score and makes adwords keyword buys way cheaper. The drawback is the content cost. (Good thing, high quality content is cheaper now thanks to this solution. However, even with high quality content, it is hard to draw the higher paying keywords without dramatically degrading site layout/site content quality.

b) Buy search terms at Yahoo publisher network and other networks. The competition of arbitragers have pushed prices up so unless you’re in a low competiton “sweet spot” niche, the profit spread is low and getting lower. Plus inventory and volume make most niches not worth pursuing.

c) Buy cheap facebook clicks. The trick is to focus on niches that cater to foreigners and similar relatively cheaper ad inventory. One large example of such a niche is immigration and overseas worker type ads. See screenshot below.

Why go the facebook route? The volume is there–facebook is blowing up in many foreign markets. The price advantage is there since facebook charges WAY lower for foreign ad space than premium American ad inventory.

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