1.  First find niche keywords that bidders are bidding on fairly high in overture and google adwords. You want to find words that are bid on from like $1.00 per click up to a max of $5.00 per click.

If you try and build a site for keywords that are bid at higher then $5.00 per click then you will have way too much competition.   For example, I would stay away from credit or mortgage type of keywords because of the amount of competition.

2. Next, you want to build optimized pages for those niche keywords.  The goal is to build one web page devoted to one niche keyword phrase.   For example, if you want to try and get the keyword phrase of   “dog training”  then you would build one web page and name the page  dog-training.html

Then you would either write up an article about dog training yourself, or go find an article on dog training.

You can find thousands of copyright articles that the authors allow you to use.  One place is goarticles.com

Inside the members area is access to building optimized keyword pages that work extremely well for getting good rankings in Google and Yahoo.

3.    Utilize the right format for putting your Google Adsense pages is crucial.  For instance, it seems that using no borders and making the adsense ads look like the text content does pull better.  In fact, the 336×280 or 300×250 boxes pulls much better then the 120×600 or the 728×90.

With the proper format and site you I have been able to pull in a clickthrough rate of 20% and higher for all my sites.   Where the average site pulls in only about 3% – 5%.   So proper formatting makes a big difference in your conversions.

However, the format alone doesn’t make you money.  The bottom line is that you need targeted traffic to your site to make lots of money in adsense.

Now you want to signup with a pay per click other then Google or Oveture.   There are about 10- 20 good pay per click search engines out there that get great traffic and cost way less to advertise on them. I  like to use  www.7search.com, www.goclick.com, and www.searchfeed.com . Pick only one for now to  get familiar with how the system works. You don’t want to spend too much on advertising not knowing what works best for you.

However there’s a trick to this. It takes work and effort. In order to profit you must do your homework on other ppc’s check their search stats for keywords. You must find keywords that cost less then $0.20 to be at one of the top 3 spots and get over 100,000 searches per month or close to it. That way if you break it down that keyword gets over 3,000 searches per month. And about 100 – 1,500 of those will click on your ad and visit your site per day simply cause it’s at the top. You can chose a lower amount if you want it’s up to you and I some times chose lower searches per month if the keyword I plan to advertise pays big. Even if your term has no bids and it seems great to only pay $0.01 per click. Be sure your term gets some type of search traffic per month. The best ppc sites, like google, have affiliates working for them and can generate the same traffic that google can so why not take advantage of it.

Now back to those keywords. When advertising while ideally you want to get your exact term (topic), what works better for me is getting terms that are similar or have something to do with the original topic. For example do a search for “quotes” notice that the top bid is only $0.07 (as I’m typing this).  Now note that not all of those searches are looking for your keyword (topic), that’s where the work comes in. You must constantly monitor your ads to see which is generating clicks and income. With the keyword as quotes you can advertise tons of different topics such as : Insurance Quotes, auto insurance quotes & loan quotes. Each one of these will generate a different number of clicks per day.
Google is very secretive about how much each click will earn you. In fact they raise and lower your click percentage as they feel so it’s imperative to get good traffic. When I first signed up for adsense I was told that once my daily click average went above 100/day then my percentage would rise.

Now let’s talk about those ads. While you can generate tons of traffic to your site using ppc’s your ultimate goal is to generate clicks, so in essence you want your ads to basically let your potential clicker know that when he/she visits your site he needs to click on an ad. But the trick is to secretly tell them this with out saying “CLICK THE LINKS ON THIS PAGE” (This is why my click through ration is so high!!!!). Let me explain. Now if you had an ad for a life insurance topic with an ad that said this:

Life insurance
Get fast, free and easy quotes instantly online. Compare and save. We’ll help you save time and money shopping online.

People will click on this ad because it’s at the top, but they’re expecting a site with more info and instant quotes for life insurance. Not basically another site like the one that just referred them. They’re not looking for “links” They’re looking for a site like www.americanlifedirect (just an example of a real life insurance site). So when they click your ad which you paid $0.01 – $0.20 for them to do and they see that it’s just more “links” chances are they will close the page and look else where.

However if you tell them in a round about way that the page they are about to visit is a listing of other sites then they will expect “links” and be 10 times more likely to click at least one of your ads on the page. Now if your ad said this:

Looking for Life Insurance?
Tired of searching for Life Insurance? Let Us show you the 10 most trusted sites currently available online. We have the most relevant results for you to choose from.

Guess what, when they click the ad and see more links they were expecting to see a listing of  “10 most trusted sites” and they’ll click at least one ad.
This is the trick that has earned me lots more then I pay to advertise. Over a months time I’ve kept stats and found out that every user that visits my site is worth roughly $0.30 to me (this is including the ones that don’t click an ad) If though my marketing I can pay only $0.01 – $0.20 per user then with 1000 users a day  I’d net $300 and spend only $10 – $200. giving me a daily profit of  $100 to $290.00. So in essence the trick is to balance high value keywords with your advertising campaign. Advertisers on google constantly change their bids so you must constantly monitor the adwords, plus with google you’ll never know what a single click will earn you. I’ve personally earn $5.25 for a SINGLE click and other days had clicks only get me $0.03. It’s one hell of a balancing act that takes practice to get use to.