Google continues to improve as it is testing a new model where advertisers only pay when a Web user buys a product, qualifies a sales lead, or signs on mailing list. This is best response against click-fraud and Google plans to charge advertisers more for this model. While this is great for some advertisers who want ROI, who knows if this model will ever replace the way advertising campaigns online work. It’s not just about clicks and hits anymore– just ask someone who uses Google Anaytics about how it changes the way you think about websites.
I also think about Subservient Chicken and wonder how many of its hits translated into actual purchase. Speaking of which, Burger King has a new online campaign called Huckin’ Chicken where the website is dependent on user hits. When it gets to 1 million, there is a surprise finale. It has already reached a million but you can still check it out here: www.huckinchicken.com
Analysts were quick to describe the cost-per-action test as an important step for the company. Advertisers have been asking for it and will respond favorably, said Safa Rashtchy, an analyst at Piper Jaffray.
For an advertiser, “that’s the ultimate way to verify you have a serious customer,” says Philip Remek, at analyst at Guzman & Co. “That’s [also] how you handle click fraud.”
Google did not say how many advertisers were involved in the test or how long they would last. It also declined to say what bids the new ads were generating at auction. However, analysts said they expected the Cost-Per-Action ads to sell at higher prices than the pay-for-click ads.
The challenge for Google will be to strike a balance between the two. While the Cost-Per-Action ads cost more per action, an ad that sells no products could bring the company less revenue overall.
From: Wall Street Journal: Google Tests New Action-Based Ads
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