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Creating an AdSense Account
The first thing you need to do is to create a Google AdSense account. This is a free Google service and only requires that you have a blog, web site, or any other online content. Of course you must also be at 18 years older and your WordPress blog must comply with the Google AdSense program policies.
If you think that your WordPress blog complies with the AdSense program policy, you can submit an application at the Google AdSense site, where you need to enter certain information about your WordPress blog and your personal information.
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Installing the AdSense Code on Your WordPress Blog - The Manual Way
After you've receive your confirmation notice that your WordPress blog has been accepted to the Google AdSense program, you can start implementing AdSense on your blog. When you have your username and password, simply login to http://AdSense.Google.com. Once inside your Google AdSense account, explore around and find a way to get the corresponding code of the AdSense ad units that you want to implement on your WordPress blog.
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Installing AdSense in your WordPress Blog - The Easier Way
If you're not well verse with HTML tweaking, don't lose hope as there is an easier way of installing AdSense in your WordPress blog, and that is through AdSense-specific WordPress plugin. Luckily, there are several WordPress-AdSense plugin that you can use to install AdSense on your WordPress blog. Two of the most popular plug ins are - AdSense Deluxe and AdSense Injection.
AdSense Deluxe allows you to run AdSense ad units in any part of your WordPress blog. This plug in even lets you change the style of the AdSense ad units that will be displayed in your WordPress blog. Take note however, that you can also tweak the appearance of the AdSense ads through the AdSense setup. And Google has also issued some guidelines on how AdSense units should be implemented on blogs. So, it is always a good practice to consult these pertinent guidelines to avoid penalties later on.
The other most popular WordPress - AdSense plug in that you can use to install AdSense in your blog is AdSense Injection. This plugin randomly injects AdSense units to any part of your blog posts. This plugin works best with WordPress blog with great and lengthy content and it distributes AdSense units evenly to your blog posts.
Both these plugins provide configuration settings which you need to tweak to effectively run Google AdSense in your blog. But the most important thing that you need to ensure is that your AdSense publisher ID is reflected so that the earnings generated by the ads would go to your AdSense account and not to the default AdSense account specified in the plugin default which is that of the plugin developer.
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Some Points to Consider Before Installing AdSense in your WordPress Blog
Google AdSense is just one way of monetizing your blog. It's not the be all and end all of blog monetization. Experiences from long time blogger will tell you that AdSense may or may have not worked with them. Two things that you need to remember to run a successful AdSense campaign in your blog - steady flow of content and consistent blog visitors.