Re: CPA vs. CPM the issue?

From: John Gaskill <jg_at_info-central-usa.com>
Date: Fri 29 Jun 2001 11:38:24 -0500

KIM O'CONNOR <koconnor_at_planetoutpartners.com> WROTE:

>I agree. [with Janet Attard's position that CPA
deals harm publishers and CPM deals don't bring
in sufficient $$ to keep web publishers afloat]

>The problem is that online advertising is held to
>a standard that no other media is held to. While I
>understand an advertiser wishing the best ROI and deal
>possible, if in the end it is not a win/win situation
>the number of publishers will diminish or simply be
>swallowed up by a couple of big players like AOL/Time
>Warner. This does a disservice to the advertisers (in
>that the less competition the less negotiation they have
>on price) as well as the end users (less choice in
>information is a big problem in my opinion!)

Although I feel their pain, I have to respectfully
disagree with both Janet and Kim. Here's why.

The ground rules of the World Wide Web since Day One
have been "virtually nonexistent barriers to entry."

Because almost anybody who wants to can open up a web
site (and most everybody has it seems), the number of
web sites on various topics is much larger than it would
be if people were required to obtain licenses in advance
of setting up web sites

The "stated logic" for requiring licensing was to
demonstrate that you knew and understood the rules of
the road, agreed to abide by them and passed a test
demonstrating sufficient knowledge of HTML programming,
business management, principles and practices.

As a condition to getting this license you had to agree
not to send UCE, not to spam search engines and rely
solely on "unoptimized" content for search engine
indexing.

The side benefit of licensing would be that the number
of web sites would decline where licensing was required.
Whether web sites as a group would offer better content
with less competition is arguable.

What should be obvious is that it is the number of web
sites that have driven down rates, not the trackability
of advertising on web sites (that is simply a benefit to
the advertiser of using the net as a distribution tool
for messages).

Newspapers and magazines have long been metered in terms
of response to advertising. What is the big deal? While
crying the blues about declining revenues and unfair
accountability may make you feel a little better for the
moment, it does nothing for your bottom line. Advertising
or promoting your publication might.

I suggest you spend more energy promoting your publications
and improving your content. Join the game and compete for
those advertising dollars by advertising your availability
to reach specialized markets. It takes money to make
money, but you also have to spend some.

As the Hunt Brothers learned some years ago, none of us is
big enough to corner a market that has broad reach. If you
try to do so, you get clobbered by other guys in the end,
unless you have superior or patented technology.

Long term survival on the internet requires money. Do
what you must to get it. If that means doing a better
job which kills off your weak competitors, do it. You owe
them nothing beyond civil indifference. You did not ask
them and they did not ask you to enter a segment.

That is the harshness of the internet. Ideas are exposed,
evaluated and dropped faster than in the offline world
because of the convenience and obviousness of bad ideas
and poor product.

Live with it. The future will only get tougher as more and
more well capitalized players enter the fray to protect
what they already have in the offline world (I'm thinking
of K-Mart as one of many possible examples). There is no
reason publishers will not do the same after the market
settles out (many have already done so now).

Regards,

John Gaskill
jg_at_info-central-usa.com
http://info-central-usa.com



Received on Fri Jun 29 2001 - 11:38:24 CDT