Pay per action? Google finally discovered their click fraud techniques concerning cost-per-click (CPC) were costing them more in lawsuits then anything else.
Here’s a little background for those who have no idea what CPC is. Google has placed sponsored links on their own webpages as well as offer webmasters an opportunity to make money by placing advertisements on the webmasters’ sites. Advertisers pay Google a fee when someone clicks their ad, either on a Google page or another webmasters page. So as you can see advertisers only get customers who clicked their link (therefore the web surfer MUST be qualified)…WRONG. People abused this system, and its easy to see how simple click fraud initially was. Just find your competitor’s pay-per-click advertisement and click it all day to cost them money.
So a great way to combat this fraud is only paying the host of your advertisement when thecustomer purchases a product or signs up on your site. That’s the basis behind Google’s new PPA advertising product. PPA requires an additional level of complexity in the ad network as well. Previously, Google delivered a user to a website, and sent a bill for the click. Now, Google needs to verify that an “action��? has occurred by receiving confirmation back from the advertiser.
This is great news for the small businesses who can not afford to deal with click fraud. Kudos Google!