LETTER: The Merits of Pay for Performance

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I was intrigued by "Pay for Performance Gains on CPM" (http://dmnews.com/articles/2000-11-06/11460.html).


It is possible to cut a cost-per-thousand deal that performs as well as or better than a cost-per-acquisition deal. The problem with those looking for only CPA deals is that they haven't taken the time to analyze and model all of the CPM options.


I have seen month-long CPA deals turn into three-month deals because the publisher or vendor could not do enough to get a contracted number of acquisitions to occur.


The ability to acquire customers still occurs at the impression level. If creative and site navigation are bad, it will take a lot of work to make a buy work. A lot of companies want control of their inventories because they can make better judgments at an impression level. If I have control of these measurements and data points, I can turn a CPM deal into a cash cow in a specific amount of time.


Cost-per-click deals are not quite so problematic, but there is still the chance of contracted delivery not happening during the correct time span. I am closer to the impression level here, so I have a little bit of control over the inventory, but not much.


The impression gives me total control. I can do everything in my power to control the performance of those impressions and model out whether I will hit goals early on. If not, I can move on.


• Stuart M. Davis


Beyond Interactive


sdavis@gobeyond.com
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