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Google AdWords Offers Pay-Per-Action

March 21st, 2007 by Matt Huggins

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Google announced on their official AdWords blog today that they have begun beta testing a new advertising opportunity utilizing pay-per-action rather than their traditional pay-per-click approach. The official site summarizes the process as the following:

  1. You create ads, define action & track conversions.
  2. Publishers display your ads.
  3. You pay only for completed actions.

From the AdWords PPA FAQ entry answering the question, “where will my pay-per-ads appear?”, it seems as though the ads will be appearing in existing AdSense code blocks. Given this, it sounds like it will become more difficult to make money through the AdSense program, especially for those who are experiencing a consistently low CTR. My question is if this will become widespread enough that AdSense users will feel compelled to join other networks such as Yahoo! Publisher Network.

I think that in order to appease this concern, Google needs to allow AdSense members to choose between CPC and CPA ads, with the CPA ads offering a competitive commission rate. Existing affiliate marketing programs, such as Commission Junction or LinkShare offer relatively high commission while commanding a great percentage of the affiliate market share online. The question remains to be seen if Google will be able to become a leader among the CPC advertising companies.

If you’re interested in joining the beta test, check out Google AdWords Pay-Per-Action service.

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This entry was posted on Wednesday, March 21st, 2007 at 1:41 pm and is filed under Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

7 Responses to “Google AdWords Offers Pay-Per-Action”

  1. stubsy Says:
    March 21st, 2007 at 3:32 pm

    Yeah definetly don’t want pay per action, I heard google are also gonna start offering in text ads aswell though.

  2. Matt Huggins Says:
    March 21st, 2007 at 3:56 pm

    Stubsy — I presume you mean that from the perspective of an AdSense user, is that right?

  3. stubsy Says:
    March 23rd, 2007 at 1:21 pm

    No Pay per action from a publisher point of view, I think it will decrease the earning potential.

    Do you think pay per action ads will make you more?

  4. Matt Huggins Says:
    March 23rd, 2007 at 1:37 pm

    Sorry, stubsy, that’s what I meant in my last question. I think that CPA/PPA ads will potentially earn more for completed actions, but there will be significantly fewer completed actions (CPA) than there are clicks (CPC). This will especially hurt those sites that already have a low CTR.

  5. stubsy Says:
    March 23rd, 2007 at 5:28 pm

    Yep it will, could be good for advertisers though.

    How did you get that google maps video ad on your site?

    I want one

  6. Matt Huggins Says:
    March 23rd, 2007 at 6:04 pm

    I didn’t specify anything for Google Maps to appear on my page, so it was probably one of Google’s AdSense ads that appeared for you. I don’t think Google has a maps-specific ad for people to display for referrals.

  7. stubsy Says:
    March 24th, 2007 at 2:20 pm

    Cheers I had a look on the google adsense faqs it says you need to enable picture ads a put them in a Box or small rectangle.

    By the way I noticed your putting a lot of effort into your project, hows your revenue increasing?

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