Adotas

Where media buyers start online

Featured Author

Author Photo

Marc Barach is Chief Marketing Officer of Ingenio, Inc. a San Francisco-based company that pioneered the Pay Per Call advertising category in 2004 with the Ingenio Pay Per Call Advertising Network. Marc is a 20-year marketing veteran and regularly speaks on search engine marketing topics at industry conferences, including ad:tech, Search Engine Strategies and DM Days.

More articles by Marc Barach





Features

Can the Click: Why Pay-Per-Call Represents the New Breed of Ad Strategy

Written on
May 17th 2006
Author
by Marc Barach  |
Feed
   XML Feed

There is no question that paid search advertising has been one of the most revolutionary advertising models we’ve seen to date. Online ad spending in the U.S. surged to a record $12.5 billion in 2005 and search advertising — also coined “pay-per-click” advertising — is by far the fastest growing segment, accounting for 40 percent of the total online ad spending in the U.S, and expected to grow from $4.2 billion in 2005 to $7.5 billion in 2010.

As the pay-per-click product enters its adolescent phase, new paid search models which extend the principal of performance-based advertising have emerged. Pay Per Call is one such model that has captured attention in the marketplace among both advertisers and publishers. Pay Per Call allows advertisers to purchase calls to their business (as opposed to clicks to their website) from targeted, online ad listings in a performance-based model. There’s hardly a search engine, portal or directory that hasn’t given it some consideration and many are in various stages of testing or rollout. Why? New monetization models are a means to not only attract new advertisers, but to broaden existing advertiser relationships.

The pay-per-click product will no doubt continue to attract advertisers and enjoy success for years to come. That said, even today, only a few percent of US businesses advertise on the web — the majority have yet to venture online. Consumers, on the other hand, show no such reticence; we are conducting more commercial searches online every day, and it is now estimated that 25 percent of all web search is local and commercial in nature. The result is a supply and demand disparity; consumers are increasingly using the web to access business information, but advertisers are lagging behind because the traditional pay-per-click model doesn’t necessarily fit the needs of their business.

In addition, our environments are becoming more complex by the minute. The term “search” no longer just refers to “web search” on a desktop, as new mediums and formats like mobile search and free 411 services are taking shape. As new technologies continue surface and consumer behavior shifts, a dizzying array of ad distribution channels have appeared, and dreaming up ways to monetize each new medium is forcing our industry to think outside the box. Simply put, our worlds have become more sophisticated than the pay-per-click model can support.

The bottom line is, not every online advertiser wants to spend cash on clicks, nor does a click-driven monetization model make a lot of sense when it comes to ad distribution outside of traditional web search (have you tried clicking to a pizza joint’s web page via your mobile phone recently?). The good news is that advertisers are looking beyond the confines of pay-per-click to see what else is out there. Are they planning on abandoning their click campaigns? Absolutely not. But as the future unfolds, alternative models like Pay Per Call will take on new meaning for some who never considered it an option before.



Pages: 1 2 next page »

No Tags
Article Sponsor

More Features

Reader Comments.

I think pay per call is great for the publishers but is not so sweet for marketers. A solution that has flat fees and gives priority to every advertiser is just around the corner.

Posted by Martin Garcia | 1:52 pm on May 17, 2006.

Actually, a leading pay-per-call advertising network platform that uses the rate card (flat fee per category) approach to pay-per-call, like Mr. Garcia alludes to, has been in the marketplace for more than six months: ZiffLeads.com. And Mr. Barach is right on, in terms of the appeal and new channel opportunities for the pay-per-call model.

Posted by Franklin Bali | 5:40 pm on May 17, 2006.

Leave a Comment

Add a comment


Spotlight

Turn VP: Ad Network Shakeout “Inevitable”ADOTAS EXCLUSIVE – Turn bills itself as the world’s first Smart Market for online advertising. Turn’s VP of product and [...] more...

Adotas Partnership