In Joel's book he has an example of tracking car parts and car accessories. In it, he mentions setting up a channel to track the earnings of all ads with the term "car accessories" in it. How do you do that?
All he means is to set up channels to track the progress of your individual ad placements. You can choose to set up channels for specific ad placements, specific pages, or specific URLs if you have more than one site. To do that: AdSense Setup --> Channels --> Add new custom channels (or URL channels --> Add new URL channels) Then you would generate new ad codes and select that channel. Or you could just create your ad code as usual, then enter the channel name you'd like for that newly created ads. In other words, read the below link for more info: https://www.google.com/adsense/support/bin/answer.py?answer=32614