Channels provide a solid platform for the compilation of meaningful reports. Google identifies two types of channels:

URL channels and Custom channels.  
   
URL Channels
These channels consider even the smallest reportable matter on your page as a single page of your website. A URL that redirects to a single page will result in a report that relates to a single page. Partial URLs always result in reports about all pages available below that URL, covering the complete website. URL channels are used to track the efficiency of one or more pages of your website, without altering your ad code.

How to create a URL channel?

Log in to your account at Google AdSense  
2 Click the Channels link below the Google AdSense Setup tab  
3 Choose the Google AdSense for content sub-tab and click the URL Channels link  
4 Click Add new URL channel, and in the resulting text box, enter the URL that you would like to track.  
5 Click Add channels.  
     
Custom Channels
These channels help you decide the efficiency of the ads on your website/webpage. You can assign a separate custom channel to each ad, and track its efficiency and accordingly change, improve or delete it. This provides you with detailed information about each ad on your website.

Multiple Custom Channels   
Multiple channels help to track one ad unit across several different metrics simultaneously.   
     
For example, you run a book website and you've placed a best- seller at the top and bottom of every page. To track the performance of the ad placement, you create two custom channels known as 'TopMenu' and 'BottomMenu'.  

In order to compare the pages of different best-sellers simultaneously, you do so with the help of multiple channels. All you have to do is create two new custom channels called ‘Best seller A’ and Best Seller B’.      
 
Efficiency of Ads using Reports (Statistics)
Reports are the detailed, table like formats that contain all the information about the ads on your website. Reports give you the following details:      

• Number of expressions of each ad
• CPC (cost per click) 
• CPM (cost per thousand impressions) 
• Most successful ad on your website