Pay-per-action advertising is a new pricing model that allows you to pay only for completed actions that you define, such as a lead, a sale, or a pageview, after a user has clicked on your ad on a publisher's site. You'll define an action, set up conversion tracking, and create ads that publishers in the Google content network can then choose to place in new ad units on their site. Let's run through the details:
Is it me, or does that sound like an affiliate program model?
Currently they are buying high quality very niche leads for over 6.50 to 8.50 per lead ( yep six dollar and fifty cents ). if I could get them into this program, I might be able to reduce their cost.
currently they are buying 1250 leads ( +- 10% ) per day and I have an average of 16 days a month that they make purchases. so any cost reductions can be a big score for my client.
also for those that are trying to figure our whom this product is good for, I have a great example. Say you have a site about buying stocks without a broker and dividend reinvestment, you could easily create a page that a company would buy the lead that desires to have this type of investor. ( side note : drip investor are real long term investors and rarely sell out, so it's to the advantage of the company to have a ton of them )
There will always be click fraud. This just shifts the fraud from the publisher's side to the advertisers side... (ie - advertisers not reporting payouts/sales for clicks)
Only difference, one kind of click fraud puts money into googles pocket, the other kind takes it out.)
ADVERTISERS don't need to opt out of the content network, since they will be paid CPA.
PUBLISHER will benefit because if they have been taking care of building a good content now they will not be hurt by smart pricing and will get paid more.
Let's wait and see.
Wouldn't joining this be admitting that you were an ecommerce site and define you as an ecommerce site too? This along with an Adwords account seems like it could be one more nail in your coffin if ecommerce site are dismissed or categorized as ecommerce only sites at a later date.
I guess I'm a bit paranoid about Google being big brother. They seem to be obtaining data from an awful large number of areas. Separating websites into shopping v.s. content only sites seems like a reasonable premis from where I sit - at least down the road a bit.
Wouldn't joining such a program just give Google one more piece of the puzzle and a way to later define you and segregate you as ecommerce or a content only site?
Please advise
So I guess this marks the beginning of the end of CJ and Linkshare as well as all of the pure PPC search marketing affiliates. Google is essentially taking this piece of the pie for themselves. This is what the "quality score" was all about in the first place wasn't it? Just a way to clear out the competition for Google to step in and take over with first CPA for the content network and then CPA for search. They are the "Wal Mart" of the online world.
OK, venting over..
I'm sure there's opportunity here that I haven't realized yet, so it may actually be good for affiliates who can adapt.
Wouldn't joining this be admitting that you were an ecommerce site and define you as an ecommerce site too?
No, because the program isn't limited to e-commerce sites.
Personally I'd be interested in a hybrid model, i.e., x cents per click and y cents per lead/sale/conversion. A lot of baseball players, for example, have a fixed salary with performance clauses. Why not use the same principle online?
p/g
Its a lot better than having to worry about click fraud.
CPA will be better for fraud control. On CJ you can always reverse the transaction after the fact while you can not do it with clicks plus you can report the affiliate and he can be removed from the network.
Gee, where do I sign?
I guess it will be a lot less work for the publisher, as Google will calculate the most profitable ads, but at what cost?
It only makes sense. CPM is a useful tool for advertisers in many ways from a branding point of view. CPA makes obvious sense.
Google's huge value proposition is, let's face it, this huge gosh darn database they have on IP addresess and there interestes.
They hit you every which way - gmail, adsense, you tube, google.com .. They have profiled every internet user down to a T. Do you watch videos on how to play a guitar? Then maybe guitar ads are just the thing for you, even if you're on a website about the waterways of venice.
Google's value proposition is their ability to server the right ad at the right time. It only makes sense that we let them do that rather than do it ourselves.
CPA will also allow us to embed ads anywhere anytime. Google doesn't really care where and how we embed them. It's meaningless to them.
Which means ... you guessed it .. software. We can start writing software and putting in ads. This, of course, is the downfall of Microsoft.
This was always on the radar. We always new this was going to happen eventually, and now it has. I'd say it's a brave new world out there, but it's been a brave new world for quite some time now..
Here's a scenario: User clicks on my ad while surfing at work. Notes down the URL. Returns later in the evening from home and makes a purchase. That is a successful outcome, but the publisher who sent me this good lead is not likely to get paid.
I try and track successful outcomes on my own right now. I guess I only really trace back 30-40% of the PPC wins to the ad that the visitor arrived from. Others I miss because of things like the above, or people who have cookies disabled, or any number of things. But identifying 30-40% gives me good enough statistics to work out which ads are, overall, performing well and which aren't.
In aggregate that's fine, but how is this fair to individual adsense publishers? In the long-tail land of content sites a particular publisher may only send me a couple of users. Perhaps both convert for me, but, unluckily for the publisher, I fail to track either well enough to determine that they are "wins". I will be getting "free" clicks as a result sometime, and presumably that means I'll have to bid a lot more for the ones that I do track successfully. In aggregate I'll pay the right amount, so in aggregate it'll work out for publishers overall too--but I suspect that there will be so much randomness for any individual publisher that they'll see their revenue numbers go all over the map.
As a result, individual publishers will be unable to tell which of their pages perform well for us advertisers, and they won't work as hard to create good pages. Currently publishers can easily tell which of their pages pay-off because the payments go 100% directly to the publisher who sent the click. It's then up to me to shut down ads that return junk traffic, which, eventually, signals to the publisher which pages are good and which are bad.
By introducing a lot of noise in the process I think publishers are going to have a harder time generating content that converts, which ultimately is bad for the advertiser.
I'm also wondering if advertisers can game the system somehow. I can't think of a way, really, but perhaps you could intentionally misrepresent the number of successes or the degree of success so as to pay less.
It's an interesting idea and I'll probably give it a kick if I get a chance. I'm also wondering though... so what happens if I report successes more aggressively than my competitor? What if two sites have the same number of successful outcomes, but one reports only 1/10th of the successes. Does google work out to charge the under-reporter 10x as much, overall? I guess they try and do that.
The ideal strategy is likely the one that returns the least "noise" to publishers, meaning, if a lead in any waylooks good you should return a yes, if you can, to deliver a more consistent feedback stream to publishers so that they can optimize their content, or so that google can optimize the algorithm.
