Google Ventures into CPA (Pay-Per-Action) Advertising

My gosh, there are tons of people writing about this already (here’s the post on the Inside Adwords blog) — it’s dominating Techmeme.

Since I’m late to the game, I’ll keep this short. What does Google entering the CPA market (Pay-Per-Action) mean? It means publishers have the option to pay ONLY for completed actions on their site — whether that be a form filled out, a user looking at a certain number of page views, or someone buying a product. YOU, the advertiser, get to decide how much you are willing to pay when that action is completed. I think this is absolutely fantastic for advertisers. They won’t have to worry about click fraud anymore, as it is fairly hard to game a payment system that only pays when the end user buys something (rather than just per click on an ad). Why WOULDN’T an advertiser be willing to pay X dollars per sale? There’s very little risk.

If they are not already, Google is now well on its way to becoming THE dominant advertising network. Tight integration with Google Checkout is inevitable, which will further weaken PayPal’s position. I predict it won’t be too long before advertisers will be able to buy local TV ads straight from Google. Perhaps Google is even building a marketplace for buying product placement spots in television shows and movies.

This entry was posted in Business, Web 2.0. Bookmark the permalink.