NONE: Re: ONLINE-ADS>> Cost-Per-Action Price Convergence
Re: ONLINE-ADS>> Cost-Per-Action Price Convergence
Robert J. Woodhead (trebor_at_animeigo.com)
Thu, 17 Sep 1998 17:47:33 -0500 (CDT)
"R. Bradley Byrd" <brad_at_newgate.net>
:
>It boils down to this question -- if you *could* adopt a
>model that was CPA, and that model actually delivered a high
>percentage of qualified users (as opposed to a CPM model
>that delivers a small percentage of decent users), would
>media buyers be willing to pay more?
The bottom line isn't CPM or CPC, but CPA or "Cost per
Conversion". If the manufacturers of the
MegaSoundBoomulator sound card can afford to spend $10 to
sell one of their cards, then they'll be happy to hand you
$10 if you send a customer that buys one. If that's a $10
CPA or a $.10 CPC (because they convert 1% of the
clickthroughs) or a $20 CPM (because your highly targeted
site generates a 20% CTR, of which 1% convert), so be it.
>From the standpoint of the ad buyer (such as me, recently),
I'd much rather pay on a CPA basis (say, giving a site 15%
of any revenues generated) because I know I'm in a
positive-sum situation. On the other hand, this can suck
for the site running my ads if the creative isn't, well,
"creative"! CPA puts most of the risk onto the site hosting
the banners; CPM puts most of the risk on the advertiser,
and CPC boings around between the two extremes.
I'm experimenting with CPC advertising on Safe-Audit right
now, and one of the major conflicts I find is that the sites
running my banners want creative that generates high CTRs,
whereas I want banners that generate qualified
clickthroughs. The balancing of these competing interests
is difficult.
Best
R
----------------------------------------------------------------------
Woodhead's Law: "The further you are from your server, the more likely
it is to crash." The Webmas^H^H^Hslave's Motto: "We Live To Serve."
http://selfpromotion.com/ Promote your site for FREE to 270 places!
http://www.animeigo.com/ The home of cool anime.
http://www.videoz.com/ Videos your video store never heard of
========================================================================
------------------------------------------------------------------------
This week's Online Advertising Discussion List sponsors:
The Mining Co., AdKnowledge and The 24/7 Network
QUESTION: What has 5,000 fingers and has grown 44% since April? It's been
called "a Yahoo! on steroids," and it's spreading fast across the web.
ANSWER: The 500 Expert Guides at http://MiningCo.com
---
7 out of 15 top agencies know that AdKnowledge improves web advertising
effectiveness. What are YOU waiting for? AdKnowledge. We make web
advertising work. http://ads01.adknowledge.com/SmartBanner/page/9751.2
---
CLIQNOW! Networks & The 24/7 Network. Buy reach & powerful brands:
*AP the Wire, Delphi, All Apartments, UExpress Garfield, AT&T WorldNet*
Get these sites on your next buy. http://www.247media.com/umbrella.html
------------------------------------------------------------------------
========================================================================
Online Advertising Discussion List To Unsubscribe send UNSUBSCRIBE
http://www.o-a.com/ to online-ads-request_at_o-a.com
