Commission Junction Forms Performance-Based Ad Network

Commission Junction announced a new paid listings network yesterday that rotates ads based on their performance, instead of targeting them to Web page content.

The network, called CJ Evolution, allows advertisers to bid on listings that are displayed throughout the ad network of 20 to 25 Web publishers, which Commission Junction declined to name. The placement of an advertiser's listing is based on its performance — anything from click-through rates to registrations to sales — and all ads are on a cost-per-click or cost-per-acquisition basis.

The best performing ads receive the most premier placement, said Jeff Pullen, general manager at Commission Junction, while poor performing ads are dropped from the rotation.

“The objective here is to maximize the performance and return on both the advertiser and publisher side,” he said.

Commission Junction, San Francisco, a subsidiary of ad technology and services company ValueClick, also runs search and affiliate marketing programs. CJ Evolution gathers inventory made available by participating publishers and uses its own optimization technology to determine which ads would perform best on those pages.

For now, the ads are all text listings. Advertisers enter three different versions of their offer of varying lengths. Pullen said graphic units, which Google recently introduced in its AdSense content-targeted ad network, are a future possibility.

“We've known that text-based units have been very productive on a CPA basis from our experience in the affiliate space,” he said.

Unlike Google's popular AdSense program, Pullen said, advertisers would be able to pay only for conversions, not clicks. Also unlike AdSense, CJ Evolution will not rely on search technology to target listings strictly based on contextual relevance.

“The opportunity is to expand your reach into areas you might not have expected to see results,” he said, noting that Commission Junction's experience in the affiliate space found that offers that do not mimic content sometimes perform better.

For now, CJ Evolution is limited to invited publishers, although Pullen said it would soon allow publishers to apply online to join. He said ads would appear in banners and other traditional ad units, in addition to other page placements.

One problem that Commission Junction has run into is the clause in many AdSense publishing contracts that forbids participating publishers from using other performance-based text listings services.

“Over time, we think we'll be able to work through that,” Pullen said. “There are lots of other sites that are not using [AdSense].”

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