A New Approach to Marketing Your Business Online

Posted by: Rod Kurtz on October 23, 2007

When examining ways to market their businesses online, many companies look no further than the ubiquitous click. For budget-conscious businesses that require a dollar spent to equal a customer gained, a cost-per-action ad model is worth evaluating.

Cost-per-action is exactly what it sounds like—a marketer only pays a publisher or ad network provider when a customer takes a specific action (beyond just a click). Earlier this year, Google, which has become synonymous with pay-per-click advertising, began a new cost-per-action trial that requires some publishers to dedicate a portion of their total inventory to serve as Google cost-per-action ads.

Another popular cost-per-action model is pay-per-call, where the advertiser doesn’t pay unless they receive a customer call, thereby getting businesses much closer to a buying customer than a click does.

Why do these approaches work for marketers? They:
• Get advertisers closer to qualified customers
• Result in higher customer conversion and ROI
• Help eliminate click fraud, a common drain on small businesses’ ad budgets
• Are ideal for service-based businesses that need to generate sales; not just people perusing their Web site

Cost-per-action models ensure that you only pay for tangible leads, like a phone call or a completed online application. As an actionable ad model, cost-per-action marketing helps give businesses greater control and return on their ad dollars.

Marc Barach
Chief Marketing Officer
Ingenio
San Francisco, Calif.

Reader Comments

Ron Kosakowski

January 6, 2008 12:03 PM

This would be something I would be interested in. Where do you find a business like this to do such ads? They must be aggressive to make money and something I would love to be involved in. Email me to let me know who I can speakto further on this please!

Scott

March 14, 2008 7:45 PM

I agree a cpa model can be effective--it forces an advertiser to focus on a specific goal: e-mail, sale, or whatever. But I also see an effective way for affiliate marketers to take advantage of this. Turning it into free advertising in a sense.
By setting the action of an affiliate sign-up,they could totally offset the cost of advertising the product. Until the action is taken,the ad basicly runs for free.
Just a thought--would really like to read more on this though.
P.S. I did find a couple of sites that are doing just this.

Post a comment

 

About

Want to improve the way you run your business? Entrepreneurs, academics, and consultants from diverse industries offer practical advice on a variety of topics each business day.

To submit a tip for consideration, first check our archive of previous tips to make sure you're not repeating a tip someone has already contributed. Then send the tip to Small Business channel contributor Michelle Dammon Loyalka. Because of the volume of material she receives, she may not respond to each individual.

BW Mall - Sponsored Links

Buy a link now!