There are so many forms of web marketing, how does a marketer know how, where, or which options to select? Savvy online advertising execution occurs via sound web marketing strategy. Marketing strategy marries the art and science of web marketing so that all options are explored to best reach and serve the right audience. Web marketing strategy and execution often takes an integrated approach. Marketers may choose a combination of online advertising options that offer multiple means to generate awareness, traffic, and eventually, sales.
Web Marketing Pricing
The more targeted an advertisement is, the higher the cost. However, the targeting can also be very cost efficient, as it hits only the exact right audience.
It is important to understand web marketing pricing language as it relates to online advertising. There are several types of online advertising pricing:
Cost per Thousand (CPM)
This pricing model is based on the cost per thousand impressions. Impressions are defined as how many times an ad is viewed. This pricing metric is similar to traditional advertising like radio and television. Online advertising purchased on a CPM basis is more likely to be guaranteed inventory (meaning that the ads will appear on the website). Think of impressions as views, or “eyeballs.” CPM buys views. Anytime you hit the refresh button on a site with ads on it and new ads appear, that is considered an impression.
Cost per Click (CPC)
This model is based on the cost or cost-equivalent paid per click. A click is defi ned as a user who clicks an online advertisement as a way to get to the advertiser’s destination. Note: If an advertiser’s site is down or is having technical bugs, then clicks are most times still counted and billed for, even if the click does not go through due to a faulty site. Paid search ads (in search engine–sponsored links sections) are most commonly sold on a cost-per-click basis and are also referred to as pay per click (PPC). When ads are purchased on a per-click basis, there is no charge for impressions, only clicks.
Cost per Action or Cost per Acquisition (CPA)
Payment by advertisers is made only if qualified actions such as leads, sales, or registrations occur. Ads are also sold on a CPL (cost per lead) basis. Affiliate marketing is run on a CPA basis and has a distinct set of rules, norms, and management responsibilities. CPA deals are very likely to use co-registration deals as a method to initiate actions. (See the following.)
Co-registration is an agreement in which a company hosts a registration form where multiple other companies can collect new subscribers from them. Sometimes web surfers opting into one program are unaware that they are opting into another program. This can yield lots of new leads for an advertiser, but some advertisers spend more time and money explaining to these “new customers” who they are and what they opted into, and crediting them for a deal they did not want or expect.
Some websites, blogs, or portals sell their advertising on a sponsorship basis, meaning that advertisers pay to appear on a website. There are no guarantees for impressions, clicks, or actions. Sponsorship allows an advertiser to buy branded exposure and be visible to the audience that is on a particular website.
It is important to note that web marketing pricing options (the way ads are bought and sold) can dictate priority of placement, obligation to run ads for a length of time, control of brand/marketing message, and integrity of the advertisement.
For example, if a publisher (website owner) only gets paid per action, the publisher may want to alter the advertiser’s marketing message to initiate action, or not be crystal clear about the offer, in order to create an action.
All pricing options need to be critically evaluated before a marketing campaign is launched. There are placement, branding, and quality pros and cons to all options. Knowing your options and testing return on investment is a must.