Benjamin Edelman
January 5, 2010
When an advertiser buys a pay-per-click ad and subsequently makes a sale, it’s natural to assume that sale resulted primarily from the PPC vendor’s efforts on the advertiser’s behalf. But tricky PPC platforms take advantage of this assumption by referring purchases that would have happened anyway. Then, when advertisers evaluate the PPC traffic they bought, they overvalue this “conversion inflation” traffic — leading advertisers to overbid and overpay.
In this piece, I show Google and its partners still covering popular sites with PPC advertisements promoting those same sites. I present the role of InfoSpace, the Google partner at the core of these misplacements, and I argue that Google should long ago have severed its ties to InfoSpace. I cite specific Google promises that these placements violate, and I critique Google’s contractual disclaimers that claim advertisers must pay for these bogus placements. Finally, I propose specific actions Google should take to satisfy to its obligations to advertisers.
Article here
