March 20th, 2007
As anticipated, Google has launched a “cost-per-action” advertising program that allows advertisers to pay only for specific results, such as a sale, lead, sign-up, etc. Andy Beal thinks this is a threat to online affiliate marketing, and surely it is. But Aaron Wall’s comment jumped out at me:
If they push this as hard as they did AdSense or search it is going to teach advertisers and publishers to create efficient conversion oriented content and sales funnels. It will fundamentally change the structure of the web.
Google’s contextual advertising revolution has already transformed the structure of the web, leading to the creation of millions of web pages with no other real purpose than to serve AdSense ads. The content on these pages is purely a vehicle for advertising — the traditional Chinese Wall between editorial and advertising has been obliterated. And it has force many publishers who follow a more traditional editorial path to start poking holes in the wall. Content has always been a marketing vehicle, but never at such a granular, easy-to-manipulate level.
With its CPA program, Google will drive this phenomenon to the next level. With cost-per-click ads, spammers create bogus pages where confused consumers click on ads in an effort to escape. But with CPA ads, clicking is not enough. The game is now to manipulate consumers not only to click, but to take some further action. And I don’t use the word “manipulate” arbitrarily. This is about turning the web into one big pile of junk mail, aimed at getting you to sign up, buy, or commit to something that you hadn’t necessarily wanted.
Of course, everything exists on a spectrum. Many CPA ads will be placed next to high quality content and lead consumers to offers that they will genuinly find valuable. But that “lighter touch” publishing model isn’t what made Google the cash soaked monster it is. No, Google became big by giving “publishers” (i.e. people with no editorial goals, only profit goals) the tools to turn the web into a giant direct marketing machine.
If you think the web is filled with marketing now, you ain’t seen nothing yet. It will make you long for the days of network TV when you only had to sit through three minutes of commercials.
Google will also increase, by an order of magnitude, the pressure on advertising as a creative art, where it was once acceptable to waste half of a brand’s money. No, Google doesn’t profit from advertising. It profits from direct marketing, where the ends always justify the means.