Pay-Per-Action And Google
As Google toys with pay-per-action ad units, it may be time to seriously reconsider your advertising strategies. Pay-per-action will certainly reduce any click fraud that most advertisers experience but will it prove value for money?
Considering the amount of either click fraud or click throughs that don’t generate desired actions, perhaps the pay-per-action form advertising will prove popular with advertisers. I don’t think the publishers will share that enthusiasm somehow. I can see their monetary returns going diminishing very quickly.
For you the advertiser, the real benefit is that you are only paying when you get your desired outcome. You will find that cost per keyword may increase, but over the long term your actual advertising costs may fall. If you are getting a 4 or 5% conversion on a keyword costing 2.00 then you need to be clearing at least 5 times the ad cost to stay profitable (10.00 cost per conversion). If you can buy a pay-per-action campaign at 5.00 per action, the actual cost will halved.
The advertising industry may well look to pay-per-action as the future of online advertising. Publishers will resist for as long as possible. The one advantage that advertisers have is that there are millions of potential advertisers on line and while many will resist, there will still be millions left to take on the campaigns. Publishers that can earn 5.00 per click for pay-per-action ads will be quite happy if they can get a 4-5% conversion.
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