AdSense's advantages

1. AdSense is simple to join.
2. It's easy to paste a bit of code into your pages.
   
3. It's free to join.
   
4. You don't have to spend time finding advertisers.
   
5. Google provides well written, highly relevant ads - chosen to closely match the content on your pages.
   
6. You don't have to waste time choosing different ads for different pages.
   
7. You don't have to mess around with different code for various affiliate programs.
   
8. You're free to concentrate on providing good content and Google does the work of finding the best ads for your pages from 100,000 AdWords advertisers.
   
9. It's suitable for beginners or marketing veterans.
   
10. AdSense provides simple, easy-to-understand stats.
    
11. If you have affiliate links on your site, you ARE allowed to add AdSense ads. However, with your affiliate links, you must not mimic the look and feel of the Google ads.
    
12. You can filter up to 200 URLs, so you can block ads for sites that don't meet your standards. You can also block strong competitors.
    
13. Inevitably, AdSense is competing strongly for space on web sites with all other revenue sharing opportunities.
    
14. If you own a small web site you can plug a bit of AdSense code into your site and almost instantly relevant text ads that are likely to appeal to your visitors will appear on your pages.
    
15. If you own several sites, you need apply only once. This makes AdSense much simpler than joining a bunch of affiliate programs.
    
16. As you can see, I'm really keen on this revenue sharing service.
    

Revenue sharing

The module provides sharing of ad revenue with contributors who write articles on the site. The basic revenue sharing module provided allows for a configurable percentage of page views for specified content types to go to the node author, or the blog page author. It also integrates with referral module so referred user's node can get a certain percentage to the referring user.
-Other methods of revenue sharing are possible using the API described below, such as:
1-Different percentages based on what taxonomy the node belongs to.
2-Different percentages based on what roles the user is a member of.
3-Different percentages based on how many userpoints the user has.
4-Using a CCK field for the the Google Adsense ID.

Features

The colors are customizable, as well as the type (text/image). Ads can be displayed from within phptemplate based themes, blocks or other modules.

Several ad formats are supported, including SiteSearch as well. The full list is is in the help section of the module's settings page.

The modules allow up to 3 color and type (image/text) combinations to be chosen. This is useful if your site has a theme that assigns different color schemes to different parts of the page, for example, left sidebar and content. It also allows up to 5 custom channels to be used.
You can setup custom roles that hide adsense from users. For example, if you have paying subscribers to your site that do not want to see ads.

Some caching is also implemented by this module (thanks to Ber Kessels).

Page matching also added, so that ads can be excluded on certain pages.
Ads can now be placed anywhere in the content, via a special tag. This can also be used to call flexiblocks so fine grained visibility can be done using the block mechanism.

Access thousands of advertisers

With Google's extensive advertiser base, we have ads for all categories of businesses-and for practically all types of content, no matter how broad or specialized. And since Google provides the ads, you have no advertiser relationships to maintain. The AdSense program represents advertisers ranging from large global brands to small and local companies. Ads are also targeted by geography, so global businesses can display local advertising with no additional effort. And you can use AdSense in many languages.

Earn more revenue

You can maximize your revenue potential by displaying Google ads on your website. Google puts relevant CPC (cost-per-click) and CPM (cost per thousand impressions) ads through the same auction, and lets them compete against one another. The auction takes place instantaneously, and, when it’s over, AdSense automatically displays the text or image ad(s) that will generate the maximum revenue for a page -- and the maximum revenue for you.

How AdSense works

1-To put ads on a web page, the webmaster inserts JavaScript code into the page.
2-Each time a page with an AdSense tag is visited, the JavaScript creates an iframe and sets its "src" attribute to the page's URL.
3-For contextual advertisements, Google's servers use a cache of the page to determine a set of high-value keywords. If keywords have been cached already, ads are served for those keywords based on the AdWords bidding system. More details are described in the AdSense patent.
4-For site-targeted ads, the advertiser chooses the page(s) to display ads on and pays based on CPM (cost-per-thousand-impressions, or the price advertisers choose to pay for every thousand ads displayed).[10] [11]
5-For referrals, Google adds money to the advertiser's account when visitors either download the referred software or subscribe to the referred service.[12]
6-Search ads are added to the list of results after a user performs a search.
7-Since the JavaScript is sent to the web browser when the page is requested, it is possible for 8-other site owners to copy the JavaScript into their own web pages. To protect against this type of fraud, AdSense customers can specify the pages on which ads should be shown. AdSense then ignores clicks from pages other than those specified.

-“AdSense Earning = Impression-count x Click-though-rate x Cost-per-click x smart-pricing-factor. Viewing your on website will not get you banned. Just make sure you don’t click on the ads.

However, repeatedly reload your page to jack up page impressions can get you banned. Click-through-rate (CTR) is ratio of clicks per impressions. It can range from 0.1% to 30%, but most commonly around 1% to 10%.”[100 Google Adsense Tips]

“First impressions count:
make sure the ad unit with the highest CTR is the first ad unit in the HTML code of your page. Keep in mind that the first ad unit in the source code is not always the first ad unit that your users will see when the page finishes loading in their browser.”[Inside AdSense: First impressions count]
“Ads placed near rich content and navigational aids usually do well because users are focused on those areas of a page. on pages where users are typically focused on reading an article, ads placed directly below the end of the editorial content tend to perform very well.”[Where should I place Google ads on my pages?]
“Format is important for multiple ad units, display your ad units where repeat users will notice them, place a leaderboard immediately after the last post.”[Six AdSense optimization tips for forums]
“The middle, above the fold location performs the best. Best performing ad format is the large rectangle, 336×280. So the wider ad formats are doing better than the other ones and the reason is that they actually take up fewer lines. And so with every additional line, you have a chance of losing that interested user.
So the wider formats do best so specifically, the top three formats are the 336×280 that you see on the page; the 300×250 medium rectangle; and then the 160×600 wide skyscraper.
We have a feature in the AdSense account where you are able to multi-select different color palettes that blend with your site to add some variety and freshness to the ads. And that also will help decrease ad blindness.”[Google AdSense Optimization Webinar]
“The second most active
placement in terms of click-throughs tends to be the right-hand rail or margin”. “Skyscrapers” and vertical banners do well when placed next to the content in the main body. Square and rectangle ads placed within the center column also do well, provided they are placed in context to the content. Ads placed below the fold tend to perform least well, although that isn’t a hard-and-fast rule.”[Yahoo! Publisher Network: Location, location, location…]
“I found the most success in placing the Google Adsense medium rectangle either right in the middle of the page or in a middle right column as long as it has content above and below the ad unit. Its is fine to use Adsense Ads on a forum however expect a very low CTR.”[Google Adsense Tips for Webmasters]
“Post Adsense ads on text rich pages, avoid titles like the approved ‘Sponsored Links’ and ‘Advertisements’, place Ads above the fold, Match the colors of your ads with the colour scheme of your site, Blend ads with your page - remove the borders by having a similar color as your background.”[How to Increase Google Adsense CTR]
“To remove Public Service Ads (PSA) in Google Adsense develop sufficient good content with keywords, Ensure that META tags like ‘title’ & ‘description’ and the headings tags like h1, h2 etc. have content which matches the rest of your site.”[How to Remove Public Service Ads (PSA) in Google Adsense]
“You can now run AdSense on the same page as other contextual ad programs.” (January 2007)[It’s official! You can now run AdSense on the same page as other contextual ad programs]
“Google AdSense Policy: We ask that publishers not line up images and ads in a way that suggests a relationship between the images and the ads.”[Inside AdSense: Ad and image placement: a policy clarification]
“Section targeting uses certain html tweaks to force the google adsense bot to focus on specific content. Section targeting is the latest and most effective addition to AdSense”.[Display Relevant Adsense Ads Using Section Targeting]
“Over the weekend, I decided to change the number of ads units on my blog based upon where the traffic is coming from. I have a small PHP function that checks to see if the referrer is a search engine, and if it is, I display and additional 2 ad units. My Adsense revenue increasing by 284% on Saturday, Sunday and Monday!”[Positive Adsense Experiment]
“Never click your own adsense ads or get them clicked for whatever reason. Never change the Adsense code. Do not run competitive contextual text ad (2006) or search services on the same site. Do not mask ad elements. Avoid excessive advertising and keyword stuffing.”[ 15 Common Mistakes that Violate Google Adsense TOS ]
“Putting ads on your site won’t hurt your traffic. There are 6 sorts of bloggers’ income: Google Adsense, Donations (e.g. PayPal), Text Link Ads (sold for a fixed amount per month), Chitika eMiniMalls ads (pay per click), affiliate programs like Amazon, Advertising sold to individual advertisers (three-month campaigns or longer)[How to Make Money From Your Blog - a VERY extensive article]
“A number of factors come into play when AdSense tries to determine what the page is about: The URL of the page, the page title, the anchor text of links, the keywords that appear most frequently within the page, search engine queries that lead to the page or to another page that links to the page”.[How to Get Relevant AdSense Ads (Especially For Bloggers)]
“Ask yourself if you are willing to compromise your blog’s layout and over-all feel by adding ads in them. Look at your traffic and see if it’s enough to draw the crowd. Make good use of the Ad Channels. Give it time.”