Re: Editorial on CPAs

From: Todd Kellner <todd.kellner_at_list-universe.com>
Date: Fri 15 Jun 2001 09:20:12 -0500

MICHAEL EHLENBERGER <michael_at_premiumnetwork.com> WROTE:

>I just ran across this story:
>http://www.emerginginterest.com/viewpoint/jason_oates_cpa53101.shtml

>This is part one of a multi-part story on CPA's:

>"The demand for CPA deals has been building steadily.
>While it's hard to tell just when demand reached
>critical mass, in just the last few months, the volume
>has been turned up as confusion and desperation among
>media suppliers and clients abounds"

The reason for the percentage increase in CPA deals is
that there's so much open inventory right now. As this
levels off (thousands of sites are on the brink of
extinction as we speak), CPA will decline.
Advertisers are pushing these deals because they
'can' right now.

I wanted to add here that no publisher favors CPA.
Over the last year and a half, I've spoken with
literally hundreds of them who've contacted me
regarding this very issue. Not one has ever seen CPA
as anything other than an affiliate-like deal which
may be used in times of desperation.

What we have here is this -- fully half of the equation
(publishers) find CPA deals undesirable.

Last November, I conducted a survey
( http://list-universe.com/survey/ )
of 100 email newsletter publishers. At that time, 27% of
them were willing to accept CPA deals, 33% CPC, and 100%
accepted CPM. I'm sure this percentage has changed over
the past 7 months, but the attitude towards the model has
not. Here are some of the most common reasons they've
cited:

* Why should the publisher be ultimately responsible for
  a poorly-written ad?
* What if the landing page (or site in general) were
  poorly designed or confusing?
* What if the product itself were ill-conceived?
* How does the publisher keep track of the ad's ultimate
   sell-through? The advertiser expects the publisher to
   trust its tracking methods -- how often is this abused?

I found that the publishers most likely to accept CPA deals
were the B2C or "general" (jokes, quotes, etc.) ones. Most
purveyors of quality B2B content flatly refuse to accept
anything beyond CPM and the occasional CPC. Some are meeting
half-way and making hybrid deals, such as CPM with a
guaranteed click-through.

What I fear is happening is that "fluff" publishers are
grabbing at the CPA deals, which may be enough to keep
them above water while quality publications (the ones
with an engaged audience, niche domination and a high
click-through rate) throw in the towel. After the
inevitable rebound, how much valuable online real
estate will remain?

Thanks,

Todd Kellner
VP, Operations
http://Opt-Influence.com/
http://List-Universe.com/



Received on Fri Jun 15 2001 - 09:20:12 CDT