All Posts Tagged With: "google"

A lawyer, surprise surprise, is attempting to bring a class action lawsuit for deceptive advertising and “unjust enrichment” against Google over their AdWords product. Hal Levitte filed a federal suit in California, claiming that by placing AdWords on parked domains.

After starting an AdWords campaign to increase business Mr. Levitte discovered that 16.3 percent of his AdWord spend was going towards parked domains and “error” sites, none of this traffic resulted in conversions that would have normallay been generated had the ads appeared on a higher quality content site.

As of March, 2008 Google offered a way to exclude ad placement on parked domains and error sites. Mr Levitte is seeing class action status for everybody that has held an AdWords in the last 4 years and served at least one impression.

If, and it’s a big if, Mr. Levitte can attain class action status the lawsuit could be huge. AdWords contributes the lion’s share to Google’s 16+ billion dollar revenue stream so the suit, if designated class action, could be on par with those lodged against major auto manufacturers warranting large scale recalls (think Ford Explorers and Firestone tires.)

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When Google acquired DoubleClick earlier this year they got Performics, an affiliate network, they have since rebranded it as the Google Affiliate Network. Affiliate networks work with Advertisers to develop CPA campaigns. CPA, or Cost Per Action, advertisers usually pay the highest of the various monetization methods: CPM, CPC, or CPA. Advertisers only pay a Publisher when an specifc action is taken such as a user sign up or download of trial software.

Advertisers tend prefer CPA campaigns over other types because they only pay for actual results, after the conversion has taken place. CPM and CPC advertising requires the user to not only take an action to initiate an interaction between the visitor and the Advertiser but must then compel the visitor to take another action such as signing up.

Some of the other players in the affiliate network space, Affnet.com or Commission Junction, need to worry. Google has the scale to immediately contend with the established affiliate networks, and as small publishers look for ways beyond AdSense to monetize their audience “graduating” into Google’s Affiliate Network will be a natural progression.

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