Let's face it, Google Ads are not for every blog. Depending on the content of your blog, it just might not be worth taking up valuable real estate that could be used for more lucrative items like private ads or affiliate links. If your blog is in a crowded niche ("make money online" perhaps?), the cost per click might be so little that not even Oprah herself could get enough traffic to buy a cup of coffee. Does that mean you should give up on using Google Ads? Absolutely not.
Almost every single blog can be grouped into one of two categories: ones that can make a lot of money by displaying the ads, or ones that can make a lot of money by referring the ads. In order to get the most out of Google Adsense, it is important to know where your blog falls.
1. Niche item blogs that generate a high cost per click
Your blog falls into this category if you discuss a topic or promote an item where there is a lot of competition among advertisers. In this case, it certainly makes sense to display Google Ads directly on your site. Example blogs in this category include high tech gadget review blogs, book reviews, or stock market prospecting sites, for example. For these blogs, the advertisers bid against each other and drive up the cost per click, making each click from your website very valuable. I ran a blog a year or so ago that focused on Wireless Sensor Networks, a very niche technology that has a lot of promise for the future. Due to the small number of blogs and the high amount of competition from product vendors, that blog averaged over one dollar per click. I have all but given up on that blog, but it still earns a good amount of revenue (go ahead, check it out. I dare you. 
). Just be careful that your blog doesn't focus on TOO small a niche or else you might have trouble getting enough traffic to earn a decent income.
2. Common blogs that can earn more from referring users to Google Adsense
Blogs that fall into this category are ones that are in a crowded niche where there is a lot of competition among publishers (i.e. bloggers). Here, there are more people blogging about a particular topic than there are advertisers wanting to pay for the ad space. Blogs about making money online is a perfect example. There is simply more supply than there is demand for ad space. This allows advertisers to set a ridiculously low cost per click because they won't have to compete as much with other advertisers. Unless your blog gets thousands of visitors a day, you simply won't make any money. Do the math. Say you have an amazing blog and get 10,000 visitors a day (fyi...Shoemoney gets about 20,000+ per day). If the average click through rate is 10%, then you'll end up getting 1,000 clicks per day. In the short time that I had Google ads on BuzzMyBlog, I averaged only $0.04 a click. That ends up being a measly $40.00 for 10,000 visitors!!! Surely there are more lucrative things you can do with 10,000 visitors a day!
I know what you are thinking... $40.00 a day doesn't sound that bad. But lets face it, how many of us really get 10,000 visitors a day? If your blog is in a crowded niche, realistically you'll probably only get a few cents to a dollar or so on any given day. To me that is just not worth the space Google Ads takes up. But there is another way you can use Google ads to make more money. You can refer the Google Adsense service to your users. Google has a nice payout for this service. As soon as someone you refer earns $100, you get $100 (unfortunately Google just changed the rules for this service. In order to count, the people you refer must be located in North America, Latin America, or Japan). When you sign up for AdSense, there are also thousands of other products you can refer from your blog. Displaying these types of direct referral ads gives you many more options for earning money from the traffic to your website.
It didn't take me long to realize what category my blog fell into. I recently took down the Google ads on my site, but I am not giving up on AdSense. Instead, I feel I can make more money from referring Google Adsense and other products and services. However, I am not going to be pushy or annoying with the ads I display. No, I think it will be a lot classier to put all referral ads on their own page I call "Buzzworthy Services". Feel free to check it out if you want...or don't. I simply ask that if you enjoy reading BuzzMyBlog and decide you want to try Google Adsense, I would greatly appreciated it if you clicked through from my site. I think you'll find that no matter what the topic of your blog is, there is a way you can make good money with Google's services.
Good luck,
Jeff
