There are many other sources through which Google earns a lot till date. But ever wondered how it earns from its primary objective, i.e. through its Search Engine?
Background
Google was established in 1998, by Larry Page and Sergey Brin, whose current CEO is Sundar Pichai. It is a multinational technology company which deals in Internet-related services and products with the primary operation of providing services of a search engine.
The Business Model
To know the business model, it would be worth that we know a little bit about Google’s Home Page. Google’s Home page is a plain white screen with no ads shown on it because it is not sellable. This is what a Google Home Page looks like:
As you can see, there are no ads on the screen. So, the natural question arises, where does Google raise money? It is obviously through ads, but the model is a kind of different from the rest of the companies that earn through advertisements.
The Theorem
Ever wondered, what would it be like if people wanted to come to you and pay you a handsome sum of money to get advertised on your catalog? Yes, this is certainly the case with Google. People bid on Google to showcase their ads. The more one bids, the more one gets on the top of the search list.
But there is certainly a corollary to this theorem. The bid is made not on the type of product or service, but it is made on the keywords.
The Corollary
The ads are shown on the paid results. Let us take an instance – If you search anything on Google, like, if you search for health insurance, you find different results on the results page. The results marked “Ad” are the paid results, for which different companies have paid a handsome sum.
The crux of the thing being, normally people have the tendency to open the first or the second result which is shown on Google Search. So, companies pay money so that they could top the list and make their customers aware of their existence in the first place. If the customer is satisfied, he will not bother to go for the other search results.
This works on the keyword basis. You may be searching for the same topic, but with different keywords, the results for the same would vary, with some other company topping the list. For example, if you search for health insurance with the keywords, “health insurance online”, the result varies with some other company topping the list.
The Actual Revenue
Now, you got to know how Google earns, but you obviously must be curious to know how much it earns from its search engine. So, for your information, Google earned $77 Billion from its advertisement services, in 2015. Out of this, $52 Billion was earned only from the search engine. So, if we convert it into INR, it earned approximately 3.5 Lakh Crore!
Yes, you heard that right! 3.5 Lakh crore from just the search engine, let alone the other apps and platforms.
