Good. Evil. Bratwurst.

Why Would Anyone Agree To Pay-Per-Click?

Posted on by arlen

(Arfandia claims I’m an affiliate. I’m not. They lie.) Events in the publishing industry (newspaper and book) have made me give more thought to web advertising models, and there’s one model I just don’t get. Why would any website operator with two functioning synapses agree to an ad rate based on clicks or click-throughs? It defies common sense by penalizing the website operator for the quality of the marketing campaign.

Stated baldly, payment per click-through says to the site operator, “We think your site is a good venue to advertise our product, so we want to pay to place an ad on it. If we come up with a lousy campaign that makes people stay away, both from our product as well as your site, we won’t pay you anything at all, but if we can come up with a great campaign that attracts customers by the droves, we’ll pay you.”

In what universe does that make sense?

Throughout the history of advertising, the burden of risk in a marketing campaign has always been on the advertiser, and that’s where it should be. I make the decision to engage in a marketing campaign, the goal of which is to increase my sales and make more money for my business. I (or my designated agent) select the campaign, the locations, and the kind of advertising to appear at each location. And I reap the profit from the campaign, so it’s only fair I assume responsibility for the loss as well.

The clickthrough-based ad rate turns that model on its head. Now, instead of me assuming the full risk for my own decisions, I’m insisting a third party that has no control over, nor even any input at all on the quality or style of the marketing campaign assume a portion of the risk. If my marketing campaign fails, I lose, but I also insist this third party assume some of the loss as well, even though the loss has nothing at all to do with them or their actions, and in fact they did everything that was asked of them and there is nothing more they could have done to avoid the loss.

The website operator is responsible for delivering the ad to the readers of a site, in the size and location stipulated in the contract. And that’s all. Whether the add succeeds in attracting customers is up to the advertiser. Paying only for click-throughs is like walking up to the Post Office and saying, “Here’s a million flyers I want to send. I’ll pay you double your normal postage rate for every response I get, but nothing at all for any flyer I don’t get a response from. But you need to deliver every one of those million flyers.” You can imagine how the Post Office would react to that proposal; why should a website operator react any differently?

Yes, people are tired of being inundated with badly-made and badly-targeted ads, to the point they actively try to avoid them. But that’s the fault of the crappy ad campaigns, not the fault of the website operator. So why should any sane person expect the site operator to take a bullet for the ineptitude of marketers hired by someone else?

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July 2009
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