What is AdSense Arbitrage?
Internet Marketing Dictionary | Google AdSense Arbitrage

AdSense Arbitrage is a money-making technique in which an AdSense publisher buys traffic using Pay Per Click advertising systems like Google's AdWords, and then monetizes that traffic with AdSense so as to make profit on the process.

For example, suppose you can buy traffic for 5 cents a visitor and reliably make 10 cents from AdSense per visitor on average, then it would pay to buy as much traffic as you could and pocket 5 cents a time.

AdSense arbitrage can be quite successful but you need to be prepared to test and measure outcomes with a strong degree of discipline because it is easy to end up losing money.

There are also two methods you can employ to boost the likelihood of profitablity by boosting your visitor value. First you can use internet marketing techniques to increase the number of times a visitor returns to your site because you don't have to get into profit on the first visit if you can get people to come back time and time again. This in fact would be a classic use of an autoresponder.

The second technique is to walk your traffic to value. In other words, buy traffic that is cheap and then educate it to be interested in topics that attract higher paying AdSense ads.

If you combine both techniques AdSense arbitrage becomes quite achievable.

Don't forget to that you don't have to buy traffic from Google: there are other PPC advertising systems where traffic costs less than on Google.

AdSense does this automatically and when someone clicks on an AdSense ad, Google charges the advertiser for the click and shares this revenue with the website owner. As it happens the first ever AdSense ad for on a web page about unicycles!

The amount the web site owner gets paid per click depends on how much the advertiser is willing to pay for the traffic which in turn will depend on how capable the owner is at turning his web traffic into profits. It will also depend on how much other people are prepared to pay to advertise in the same place because the AdWords system is really one enormous advertising market place where people compete to buy and sell advertising space with prices literally varying from one minute to the next.