--- from cnet
SAN FRANCISCO (Apr 28, 1996 1:17 p.m. EDT) -- The Internet is buzzing
over reports that Procter & Gamble, the nation's largest advertiser,
will begin limiting payment for some World Wide Web ads to the number of
people actually lured to seek more information, not all who see the ads.
Essentially, the new plan would be like a shop owner paying only for the
would-be customers an advertisement attracted to his store.
The Web directory service Yahoo! Corp. has agreed to accept ads from
Procter & Gamble Co. on a "click-through" rather than "eyeball" basis,
according to Advertising Age magazine. The move has set off a
call-to-arms on several Internet mailing lists that deal with online
advertising issues.
Up until now, most Web sites have sold ads based on the number of people
who see them, just the way newspaper and television ads are sold. Each
"hit," or individual user access, counts as one pair of eyeballs. The
cost per thousand viewers is usually around $20 on a Web site, though
the range can be anywhere from $5 to $80.
Yahoo! of Sunnyvale, Calif. reportedly will place ads on its Web site
for five Procter & Gamble brands on a "click-though" basis, which means
the company pays only for users who actually click on the ad to "surf"
to Procter & Gamble's own Web sites.
"Let's say somebody ran an ad in the New York Times. If they only paid
$10 for every phone call that they generated out of that ad, that would
be the equivalent of click-through," said Kevin Fadden, chief operating
officer of Interedge New Media in Lawrence, Kansas.
Fadden has launched a campaign on several Internet mailing lists devoted
to online marketing against the notion of click-through ads and Yahoo!
for, as he puts it, "cracking under pressure."
"The advertiser should and will pay for every time you name or your
product is seen by a consumer. This is how TV works, this is how radio
works. The Web is going to work the same way," his rant read. He has
threatened to sit in the press room of this week's Internet World
convention in San Jose, Calif., railing against the click-through model.
Procter & Gamble spokeswoman Elizabeth Moore said it was the company's
policy not to discuss confidential discussions with its suppliers.
Yahoo! declined to comment.
The people who actually create the sites that provide the real estate
for ads, so-called content providers, feel click-through isn't fair
because the number of clicks on an ad has nothing to do with how good
their Web page actually is.
"You're devaluing the content of the site by setting up these payment
schemes," said Tara Lemmey, president of Narrowline Inc., a San
Francisco-based Internet media research company.
But Jeffrey O'Brian, senior editor of Marketing Computers magazine, said
the Web is fundamentally different from traditional media.
"In a way (click-through) holds the Internet to a higher standard than
other advertising media out there, but the Internet has something that
none of those have -- inherent accountability," he said.
Unlike newspapers, radio or television, which have to make use of fuzzy
estimates of just how many people actually see an ad, on the Web it's
possible to know precisely because each "hit" is automatically counted.
Advertisers want to only pay for the people who check out their sites.
Web publishers want ads that will help pay for the content that's
drawing in viewers. And both sides are getting antsy about pouring any
more money into the Web without seeing concrete results.
At least in the short term, some kind of hybrid between the two models
is likely, said Tom Baker, business director of Wall Street Journal
Interactive, which debuts Monday.
The angry rumblings from Web publishers don't suprise Lemmey, the
Internet researcher. Commerce on the Web is so new that more fights
about how it should be paid for are likely before any kind of standard
operating procedure is worked out, she said.
"If you read the history of advertising, every time there's a new media,
it goes through several ways of looking at how it should be done,"
Lemmey said. "It's not necessarily taking the old rules and applying
them. We need to look at the medium of the Web uniquely."