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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
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!


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.

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