By Paul Lang, Editor, Sell It!
May 23rd, 1998

See Also   The Insider Secrets to Marketing Your Business on the Internet   Alternative Payment Solutions   Fraud Prevention Tools   Top Tools to Help You Boost Customer Service   iV-Caller Verification Service   Make Your Price Sell!   FindWhat.com   Make Your Knowledge Sell!   HumanClick   Netship   iFulfill.com   Nexchange   Nothing But 'Net   Netwhistle.com   Bigstep.com   Make Your Site Sell!   AWeber   GoTo.com   Constant Contact   WebAdverts   PersonalStore   SiteInspector   LinkExchange   ClickTrade   Safe   eCHARGE   MilliCent

As part of the promotion strategy for your Web store you may well decide to use banner advertising. However, although banner ads are by far the most common way of advertising on the Web, they are still a relatively new method. As a result, there is still much debate around how the success of banner ads should be measured, and how they should be paid for. The root of this debate is the different needs and aspirations of the advertisers and the banner ad hosts.

Advertisers place banner adverts on Web sites in order to achieve specific goals. How they measure the effectiveness of their ad campaign, and how they wish to pay for it, is dependent on these goals. For example:

• If their goal is to build a brand, then they will measure success based on the number of exposures their ads receive and will be happy to pay per ad impression.

• If their goal is to build traffic, they will measure the number of click-throughs to their site and will seek to pay ad hosts based solely on click-throughs.

• If their goal is to increase on-line sales, they will measure the number and value of orders received and will want to pay a fixed fee or commission to the ad host for each sale.

The Safe Audit banner system is one potential solution to these conflicting needs. It works by throwing away the rate card and creating a market place for banners. Advertisers submit ads to the market with details of what they are willing to pay per exposure, per click-through or per sale or any combination of the three. Hosts can select which banners they want to host based on these figures.

Once enough data on the performance of each banner has been collected, audited results are made available to both advertisers and hosts. This data includes the ratio of click-throughs to exposures, the ratio of sales to click-throughs, the ratio of sales to exposures and the average value of payment per thousand exposures (CPM).

Although there is no rate card, Safe recommends advertisers aim to pay their hosts the equivalent of at least $4 CPM. However, currently no banner in the Safe network is offering more than $3 CPM with average being between $1 and $2 CPM.

One of the main benefits of Safe for advertisers is that they can structure payments in any way they like. Payments can be made per sale, per click-through, per exposure or any combination of these. The payment model can also be altered during the campaign to maximise results. For example, an advertiser could initially offer payment per impression until enough data is available to allow Safe to publish performance results. Payments could then be switched to per click-through or per sale. Sites would still be willing to host banners on this revised payment basis because of the availability of audited performance results.

Advertisers can also choose which categories of site they wish to advertise on. Safe maintains the quality of sites by insisting all host sites have a high content quality and by disallowing some types of sites, for example adult sites.

Just about anyone can sign up to become a Safe advertiser, as long as they can commit to a minimum spend of $500 per month. There are some restrictions to the type of advertising Safe accepts with, for example, adult sites being excluded.

From the host's perspective, the major benefit Safe provides is the ability to choose from a list of banners based on real performance statistics. There is also no minimum contract period, so hosts are free to replace banners at any time if they are dissatisfied with their performance.

There are few restrictions to becoming a banner host. As long as you have a high-content site that attracts over 100 visitors per week you can sign up, although certain types of site are excluded. Safe claims to have 4600 hosts offering some 156 million page-views per month.

Hosts pay 20% commission on all advertising revenues. All advertiser sites bills are due by the 15th of the following month. Safe pays all its host sites before the 30th of each month for the earnings of the previous month provided the sum earned is more that $10, otherwise that sum is carried forward to the next month. Payments to hosts can be made in either US Dollars or British Pounds.