Re: CPM Pricing Models

From: Andrew Bourland <andy_at_bourland.com>
Date: Mon 21 Jan 2002 14:51:23 -0500

> "Janet Attard" <attard_at_businessknowhow.com>, quoting

>> So why should publishers bear the responsibility for ads
>> that don't work?

At 9:42 AM, "Brad Jensen" <brad_at_elstore.com> wrote:

> So that they can cut the risk for the advertiser and get their
> business. In other words, to compete with other publishers in a
> buyers market.

Brad, the question wasn't about "cutting the risk", it was
about "bearing the entire risk" of the advertisement.

It's a question of integrity and fairness. There are many CPA
ads that have do a great job building consumer awareness of a
company, a product and/or a particular URL, but do nothing to
compel the action that the advertiser would pay for if they
did it: click the ad or buy the product.

If a company is going to put a CPA ad out there, they should
grease the skids as best they can for the publishers who
choose to bear that risk, and design compelling ads that are
likely to be responded to.

What's happening is that there's a lot of free brand building
going on on the backs of desperate online publishers... And
it's a sad sight to behold.

> To turn the question around, why should the advertiser take the
> risk that your site will produce a profit for him?

You think that advertising should be totally free of risk?

> Please don't
> tell me because that's what they do in magazines. That's not a
> reason, that's a whine. Unless you are telling the advertiser to
> go back to magazines.

It is a legitimate statement that no other medium is held to
the degree of accountability that online is. It's not a whine,
it's a fact.

We're still very much an advertising medium in development.
Over time, I think advertisers are going to like what they
get out of online so much, they'll port much of what they've
learned over to other media...

> People are starting to charge for some part of what they have
> given away for free.

As well they should. This is precisely why I'm tracking the
movement from Free to Fee and have -- a week after the launch
of bourland.com -- been deluged by email from publishers
planning and executing their move to Fee.

It entails tremendous risk, but the vast majority of online
publishers no longer have a choice: if they want to survive
and thrive they can't rely exclusively on ad revenues.

Andy

--
Andrew Bourland
http://www.bourland.com
Monitoring the shift from Free to Fee
Currently on Bourland.com:
* Getting Started: Resource Sites Worth Bookmarking
* Getting Started Part II: A Few Articles Worth Reading
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Received on Mon Jan 21 2002 - 13:51:23 CST