The Pay-As-You-Click Advertising Model

During a down economy, online advertising has taken a hit, with many marketers now questioning their effectiveness. Companies are changing payment models and measurement systems for the ads and commissioning research in a bid to breathe new life into the format.

So today, I took note of an announcement by a company called VideoEgg, which unveiled a new product aimed to help marketers find Web sites where their ads are likely to attract consumers’ attention. Pretty cool stuff. By leveraging AttentionRank, the company claims the following results, which include a 15 percent increase in user engagements by placing ads where users are most receptive:

AttentionRank: claims of 15% increase in ad engagement

So here you have a company that’s coupling the new product with a “cost per engagement” pricing model, in which marketers pay for an ad only when a consumer reacts to it. I can imagine that during a recession, when marketers are looking to get the most bang for their buck, CMOs are looking for such advertising models. But I could see some issues.

Marketers have never traditionally been all that impressed by the performance of display ads, and as major Web publishers have yet to adopt the new model, it is limited to the network of sites on which companies such as VideoEgg sells ads.

But I think ideas such as these will carry merit in the long-haul. The economy has taught marketers to drive the most from their dollars spent; new payment/advertising models such as these are a reaction to that. As a result, I think you’ll continue to see a real focus on Web-based advertising, specifically marketers becoming the exclusive advertiser for a section of the site and other features that mix advertising with news or entertainment features.

One thought on “The Pay-As-You-Click Advertising Model

  1. We run the VideoEgg CPE adds across our network of sites and have been very happy with how they have performed for us. The new Twig ad units are a great leap forward as its moves away from traditional ad units which are often not seen on longer pages when you scroll away from them.

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