Webshots Gets Traffic on the Cheap

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What began as an experiment six months ago has resulted in an astronomically low cost-per-click rate for one Internet marketer.

Since launching the program that offers Web surfers a free daily photo to download for monitor background art -- or wallpaper -- The Webshots Corp. claims it is getting people to click through banners and other advertising links at a rate of about 4 cents each.

Webshots previously had offered a shareware version of its product that expired after 60 days, but too many people were opting not to pay $20 for the full package.

"We had millions of people trying our software, but not everyone was keeping it," said Andy Laakmann, the 30-year-old CEO of Webshots, San Diego. "The relationship [with Web surfers] is worth much more than a $20 sale."

Indeed, Webshots sells advertising on its site through the Flycast Communications ad network. The free photo offer is fueling 2 million page views per day, up from 1 million a month ago. Ninety percent of the site's inventory is sold, said Laakmann, who estimates that Webshots is on well over 1 million desktops.

Once downloaded, the software flashes a daily reminder to "click here" for a photo of the day. Webshots said 70 percent of the people who click through choose a new photo and that in one week in July, the site received 1.1 million click-throughs from the daily reminder.

With no outside funding, the 13-person company claims to be profitable and on track for $3 million in software sales and ad revenue this year. Webshots had $1 million in sales and ad revenue in 1998, and projects $7 million in 2000.

The company plans to launch a Webshots Community this fall where people can offer their own photos for download. The company also plans to offer photographers a venue to sell their work to its growing audience.

During the week of Aug. 8, Webshots was the second most popular software downloaded on the Internet with 176,521 downloads, according to CNET's Download.com, but still far behind messaging software ICQ, which was downloaded 856,780 times,.

"I don't care if their giving away a car and the odds of winning are extremely high, a 4-cent cost per click is extremely low," said Jay Schwedelson, corporate vice president of online ad placement firm WebConnect, Boca Raton, FL. Though variables involved in campaigning make it impossible to arrive at a Web wide average CPC rate, most sites that sell advertising on a CPC basis charge 40 to 50 cents each.

"If [Webshots has] been able to work out their program to 4 cents a click, they've beat the system," said Schwedelson. Also, Laakmann claims, Webshots' banner click-through rates run in the 8-percent to 10-percent range, far above the industry average which is generally around 0.5 percent. The reasons: a free offer, aggressive deals with niche sites and highly targeted ads.

On Flyfish.com, for example, Webshots' banner invites visitors to "Download the Ultimate Flyfishing Screensaver Now Free."

"We have a huge network of grassroots sites, because they're much more willing to negotiate aggressive deals than are the big portals," said Laakmann. "We achieve the same volume" as portal buys without paying portal prices."

On any given day, Webshots runs 200 creative approaches on 1,000 Web sites. The firm also buys run-of-site advertising on the Flycast network. "We use them coming and going," he said.

Laakmann believes banner ads' critics are misguided. "The banner is not lowly. The mistake is that people's messages are lowly," he said, adding that too many banner creators focus on graphics and not the offer. "You have to focus on the message and make the offer real," he said. "People aren't stupid and they know 'Win $1 Million' isn't real so they don't click on it."
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