Right now cost per click is the big thing, but it is clear that it is dying. Why? You pay for clicks because you assume a certain number of those users are going to go on to make purchases. Why use assumptions, when it is so simple to know the real number? Cost per click actually makes the least amount of sense from a strategic stand point. Online advertising performs two roles, first it should drive purchases and second it should help build the brand. Cost per click is not tied to either of these. CPMs make more sense in terms of measuring brand exposure and CPAs make more sense in terms of measuring purchases. Where does CPC fall?
Hmmmm...so you're saying I should stop making an average net profit of 5k a month from my best performing PPC web site (I once had an 18k net profit month)? I pay up towards $1.25 a click on some of my best keywords, but as long as my conversions are steady, why figure it's dead? I have many other sites which bring in a couple hundred net profit a month as well which I pay money for each click. Why stop there either? Sure, I like the easy money from some of my SEO'd sites which are in good rankings, but I will still take the bottom line even if it means I track my ROI day to day. I spend 5k a month and get 10-12k plus 5% cash back rewards on my credit card bringing in an average net profit of $5250 - $7250 a month on CPC alone. I've filled both roles of gaining dailey purchases and building brand. I get dailey sales and a trickle of testimonials for my product. Cost per click is dead if you don't take the time to tweak and maximize your ROI. I track daily what I spend, how many clicks I received, average CPC, and my conversion rate. I never assume anything when starting a new PPC campaign. I always start out with low bids and niche keywords or phrases. I track my costs and conversions dailey, then adjust price for more traffic. As long as your conversion rate is consistant with traffic growth then you can get a GREAT return on your investment. Why assume that anyone in internet marketing would assume?
The point is not that CPC is bad, it is better than CPM for conversions, but isn't it better to only pay when someone has actually completed a conversion? If your answer is yes, then you know why cost per click is dead. I would be shocked if in the next year you didn't see a CPA offering from Google.
The problem is proof. CPA doesn't work as easy as CPC. Proving you received a visitor is easy. Being able to prove you had a sale depends on many other factors.
They definitely don't work well. Read through affiliate forums and you'll see all kinds of complaints about untracked sales.
There is no reason this should be the case. I agree you can't get it 100% no system ever could, but site analytics programs make there money getting pretty close, so why cant a good ad serving program?
There is a wide variety of websites on the net, while the importance of CPC may decrease it will not be dieing for a while.
CPM quickly has a diminishing return. How many times do I need to see the Coca Cola brand before I decide to continue to drink Coke for then next 20 years. CPA can and will cost more, if someone can successfully sell a mortgage on line they should surely sell this skill to the highest bidder and $1 clicks or $20 leads will rise rapidly. CPC is a form of selling leads. It gives the advertiser a chance to sell which CPM tends not to do now and it also lets the advertiser controll the selling process. CPC and other forms of advertising on the web will not die but they will evolve. Over time, advertising dollars grow. There were large amounts of dollars to be made by showing banners 5 or more years ago. Now text ads are certainly hot. Google just rolled out a Ad Links to complement Adsense and Google search. If you stand still, you can eventually get run over by a glacier. Stay with your web advertising but move as things change.
Wow I didn't think I'd see the day that people thought PPC is ending. I think that we're just starting a PPC trend that will grow over the next several years. Jupiter research has put out a growth projection of double digits for online ad spending over the next few years of which PPC will benefit from. Furthermore people are just beginning to fully understand and analyze their PPC advertising through ROI and web metrics. I'm a little bit more optimistic on PPC.
What I prefer about CPC to CPA is that I can check as a publisher how many clicks have been generated with my own tracking tools, i.e. I know how much money they should pay me for the visitors I sent. I can check how many clicks I sent through a CPA program as well but there is no way I can see how many sales the advertiser made from my clicks so I rely totally on their tracking system which can tell me anything but the truth. That's why you also can't trust any CPA program unless it's from a really really reliable company concerning ad programs like Google. I was a member of a CPA program and earned $470 according to their stats but I never even got them! Google and other CPCs always pay and I think one of the reasons you get your payment easier is that you can proof on your own that you generated clicks you must be paid for as stated above. The thing that is really dying is CPM, there are fewer and fewer CPM programs because people want clicks to their site not just show a picture of something that can be related to their site.
Well i think PPC is far from dead since different websites have different need that suit some make suit CPA and some will suit PPC. But i think CPM is Dead.
These two headlines showed up in my.yahoo.com today. Advertising does grow over time and it will shift to productive media. I guess I'll stick with my web sites and not launch a TV station. Yahoo Profit Up on Web Ads, Stock Rises http://story.news.yahoo.com/news?tmpl=story&cid=582&e=1&u=/nm/20050419/wr_nm/tech_yahoo_earns_dc Global TV Ad Spending Seen Losing Share to Web http://story.news.yahoo.com/news?tmpl=story&cid=582&e=4&u=/nm/20050418/wr_nm/media_zenith_dc
Any model, including CPM, CPC, CPA, etc., works fine if used properly... and if advertising services care of the quality of their managed medium, not only their revenue. There are countless options to improve basic CPC approach used by Overture and Google, so that more advertisers could benefit from it. But most likely we won't see these improvements while they can get more and more profit by simply replacing one generation of disappointed advertisers with another one, who are willing to pay more just because they are not experienced in CPC advertising yet.
If cost per click is dead then AdSense is dead. You do have a point. Therei s a lot of click fraud going on but not enough to justify eliminating the entire concept of CPC. In fact many new companies are coming up with different CPC models besides AdSense/AdWords, etc. Nobody will ever be able to stop click fraud. That's a cat and mouse game.
Google themselves moves into PPC alternatives: http://www.reuters.com/newsArticle.jhtml?type=internetNews&storyID=8285566
I've heard alot of people get tired of the pay per click and advertisers feeling like not only are people not clicking on them but it's easy to cheat them. I think it's annoying to have tons of popup ads and spyware..ugh don't get me started. Hopefully someone will devise some wonderful master plan for a better advertisement system