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AdWords vs. AdSense: What's the Difference?

adwords vs adsense

It's hard to blame anyone who confuses Google AdWords with Google AdSense. The two services have similar names, and they even serve different sides of the same advertising coin.

But before you take advantage of either of these valuable marketing resources, it's important to understand the advantages of AdWords vs. AdSense, and how each platform can benefit your marketing strategy. When utilized correctly, both platforms can help brands optimize their ad spending and even generate revenue to fund additional campaigns. Here's a look at how AdWords and AdSense can help your business raise its standard for digital performance.

Understanding AdWords

Google AdWords features text-based ad campaigns that are run on Google. The platform gives businesses basic tools to conduct keyword research and control other factors related to how and where an ad appears on a search engine results page. When you want to run advertisements in response to search queries where your organic page rank isn't strong, AdWords is a great fit.

The cost formula for AdWords utilizes either CPM — cost per 1000 impressions — or pay-per-click. The competitiveness of keywords increases the cost as businesses bid for ad space, and you can set a limit to ensure your spending doesn't surpass your budget.

Understanding AdSense

AdSense works in tandem with AdWords, but it serves a different purpose. Whereas AdWords concerns the process of creating ads for businesses, AdSense is essentially a platform facilitating ad placement on other websites. If you have a website where you want to sell advertising space, AdSense can help you attract campaigns set up through AdWords. It's free to set up an AdSense account, and when advertisements do start being placed on your site, you will gradually earn income from those placements.

The amount of money you earn ultimately depends on the amount of relevant traffic your site earns, as well as the competition for keywords bid on by AdWords users.

Deciding Which One is Right

Depending on your company's marketing goals, both AdWords and AdSense might be valuable channels. AdWords is probably most common for SMBs because it's an easy way to use search engine marketing (SEM) to reach a relevant audience and build brand awareness. But AdSense can be a great marketing tool if you have a website or online publication and you want to generate some revenue from that asset. Those revenues could even be reinvested into marketing strategies like AdWords, funding additional SEM campaigns.

In the end, it's not so much a question of AdWords vs. AdSense as much as it is a question of what fits your current strategy. Both have value and both offer ROI potential for brands, but any campaign or ad placement strategy should be in service of your business and marketing goals.

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