After reading a couple of reviews on Adsense Referrals 2.0, I decided to get my feet wet and placed Referral 2.0 ads on a number of my pages. Early results seem to show promise. With the first five clicks, I made one conversion that paid $2.40 (update : since drafting this post 7 days ago, I've made $48). Not bad for a start, but it could be a fluke and I know earnings from Referrals 2.0 will fluctuate anywhere from a couple of cents to a couple of dollars. I think watching the performance for a couple of weeks will give me a better picture. In any case, Adsense Referrals 2.0 is a welcome revenue stream for publishers who want to select their advertisers.

Here's my take on what the Adsense Blog says about Referrals 2.0. (Adsense blog quotes are indented) :

Every Adsense publisher gets off target Adsense ads every now and then, especially on pages that don't really have a focussed topic, so placing Referrals 2.0 ads on those pages might be a better alternative. However, I don't consider Referrals 2.0's product inventory all that impressive right now. I'd like to have more choices of what to put on my sites. However, I think that they're on the right track. The Adwords advertiser stable is huge and everyone can benefit from Referrals 2.0. but they're probably playing a wait and see game before jumping into Referrals 2.0. When that happens, I believe it's going to be great.

Sounds good but lots of room for improvement. This is probably one of those kinks that Google hasn't ironed out yet - their categories aren't spot-on. Right from the start, when I looked into the inventory for the Business category, I found a couple that were totally out of place. One in particular stuck out like a sore thumb - a FREE dating site. They've got to get their categorization sorted out.

Because their categorization doesn't work all that well, if you check the "Pick Best Paying Ads" box, you'd best be prepared for some really off-topic ads. Imagine having spents months perfecting your homepage or internal pages on Business startup, getting the SEO correct, finding useful links for your visitors, getting matching ads to complement your content, and whammy out pops this "FREE dating site" ad. Not only does it stick out like a blatant money making plug, but it gives your visitors a bad impression of your site. You could always opt to uncheck the "Pick Best Paying Ads" box, but if you do, then if your chosen ads are not available, you will have a big hole on your page. Caught between a rock and a hard place, I think.

One of the problems with Adsense's contextual ads is that they often spit out off-target ads. Many believe that if the MediaPartners bot (Adsense bot) hasn't visited the page, they rely on key words or phrases in your domain name and/or folder and URL to determine what ads to display. I've experienced situations where Adsense refused to display on-target contextual ads on a page even though I included the keywords many times. It's as though they've hard-coded what my site is about and will not budge. I've found that if you use a site-wide template that's optimized for specific key words, you stand a higher chance of experiencing this problem. So short of creating a blank page with no links to your template, it seems like the only two options available to publishers in this situation would be to :

• wait for the Adsense bot to visit that page and hopefully get the targetting correct
• live with the off target ads

Let's say you have a site about Cars and you write a page about auto insurance or child safety seats. If you find that Adsense keeps giving you contextual ads about your site theme (cars) and NOT your page topic (auto insurance or safety seats) then Referrals 2.0 will probably solve this although you need to remember that Referrals 2.0 is Cost Per Action and NOT Cost Per Click ads.

I've found this to be 100% true. Some of my general sites perform badly with any sort of revenue generating program, especially contextual ad programs like Adsense. Targetted traffic is THE secret to making money with Referrals 2.0. If visitors come to your site from search results for "home business" and your Referral Ads are aligned with that theme, you are much more likely to get clicks AND conversions.

Finally, the thing I like best about Referrals 2.0 is the fact that you can plug it to your heart's content. Unlike Adsense' contextual ad blocks where you CANNOT draw attention or encourage visitors to click, with Referrals 2.0 you can :

• place huge blinking arrows pointing to the ad and it would be OK.
• create a page based on a specific niche, write content based on that niche and then encourage your visitors to click on those ads and it would be OK
• label your ads "We highly recommend the following :" and it would be OK.
• tell ALL your family and friends by email to visit your site and click on the ad and it would be OK.

In closing, I believe that Referrals will be a huge money maker for webmasters engaged in providing focussed content. There are bugs (and some of them ARE glaring) that need to be worked out. For example, this week, system errors apparently caused the servers to stop serving ads and many found their marketing campaigns pointing to pages with big holes in them where the ads were supposed to appear. However, like every other new program, there will be kinks that need to be ironed out and you can count on big brother Google to do it pronto. They're surely banking on Referrals 2.0 fattening their bottom line.

Why not take a whack at Referrals 2.0? You might just see a nice increase in your Adsense earnings.