Online Marketer and Advertiser - A win-win model

There was a time a few months ago, when there were quite a few requests to run CPA – performance based – campaigns. I understood the rationale behind CPAs – using CPM inventory but pay CPA. From an advertiser perspective, it is win but from the online marketer point of view it is lose.

Why so?

Typically, when a campaign is kicked off for the first time, the marketer mobilizes inventory which he thinks is ‘relevant’. Having taken this important first step, he then gets the campaign going. Even after all the due diligence of selecting the correct inventory, targeting etc, there is still the process of optimization of the campaign to ensure that you keep the highest performing inventory on the campaign. In a keyword based campaign, it would mean selecting and retaining the keywords with the maximum hits. After all this, the product/service being advertised must ‘motivate’ the user to buy.

To sum things up, a CPA campaign is heavily stacked against the advertiser in terms of ROI. But the advertiser’s point of view is also relevant… After all, he is the person with the Money, Authority and Need.

How do we strike a balance between advertiser and online marketer concerns?

The answer is to run a ‘test’ CPC campaign. An appropriate test budget – US $ 5,000 – is a good investment to test the waters. The marketer and advertiser can work closely monitoring the campaign, with the client keeping an eagle on ‘effective CPA’ – dollar spend for each sale effected from the campaign. In the initial stages of the campaign, the marketer and the advertiser can work closely, keep tabs on the campaign performance. This would result in the marketer ‘tightening’ the screws on the campaign to ensure better CTRs resulting in better ‘effective CPA’ for the advertiser. This would be the ideal win-win model for the advertiser and marketer.