After Google announced beta test of PPA AdWords service two days ago, there were near 900 blog posts about Google PPA at Technorati. In this post I will try not to “echo” this very important news. The primary emphasis is on the impacts of this move, when Google put it operational worldwide (I am not from USA to test it).
I recommend first to read very good article from TechCrunch (if you did not do it already).
PPA is near to sales
When Google decides to move towards PPA advertising, this is very big thing, although there are players in this field (e.g. Snap Search Engine). If we look at the development in the field of PPC advertising (40% share of all online advertising market), where Google is the main player, it can be very easy to estimate that three years from now we will be able to witness a large move of PPA advertising in online market share.
Although the prices for Google CPA model will be much higher then the actual CPC model prices, it is obvious that the higher prices will drive more sales. It can be said that PPA advertising is closer to sales driven advertising strategies, comparing to PPC advertising strategies. In other words, the effects are more obvious when you pay for action, but there must be much more knowledge about how to achieve these actions (emphasis on landing pages strategy). In my opinion, Google will introduce PPA model as the option, within the actual PPC model (like there is the option to have the AdWords campaign on search network, or at the content network).
PPA vs. Affiliate Marketing
There are significant number of blog posts arguing that the Google’s move to PPA market represents the threat to Affiliate Marketing networks (e.g. cj.com). For example, Andy Beal said that “Google, for all intents and purposes, has just entered the affiliate marketing arena, with the battle cry that they can do affiliate marketing better than the affiliate networks can.”
I agree with Mike Moran that it is very hardly to see that Google will go in plain affiliate marketing field (not in this move, and not now), because it is completely different when you are in the relationships with affiliates instead with advertisers.
Application Service Providing in affiliate marketing is much more than the PPA pricing model, which is introduced by Google. In my opinion, large affiliate networks will survive very well, because they have the benefits related to real sales conversion and the applications which provide turnkey affiliate solutions. But, if Google create affiliate turnkey solution…
Google Text Link Ads vs. Text-Link-Ads
Google also introduce inline text link ads (read TechDirt for more about it), and I think that this phrase will be very much “inline” with Text-link-ads.com popular link building service (because Google PR will be still actual for years to come).
Google will have a further influence on MOM movement
It is the fact that the PPC market is partly responsible for the actual measurable classic marketing movements in the fields of Marketing Operations Management and Six-Sigma Marketing (beside Sarbanes-Oxley Act). The measurable classic marketing strategies will be further influenced by mainstream adoption of CPA advertising model (regarding its effectiveness). It is very good for the further increase in online marketing budgets.