It’s merely an ad publishing application by Google that allows you to include ads on your websites and make money. The most outstanding part about this network is that Google handles everything, and you don’t need to worry about collecting the payment. So, how does Google AdSense work? The system connects both publishers and advertisers, and Google acts as the intermediary.
What happens is that an advertiser will set the minimum amount he is willing to pay for an advert, which acts as the bid price. Google will then display the bid to publishers with the relevant traffic for the ad. For example: