Google is currently testing a new ad model, the "cost-per-action" ads. Basically, the advertiser no longer gets charged for clicks, but rather when the clicks result to an action that the advertiser is seeking such as purchases, membership sign-ups, etc...

I absolutely would love to sign up for this program as I would only be charged for traffic that turns into sale leads.

The current Pay-Per-Click model is flawed as I believe there is too much fraud in this and advertisers such as myself are loosing a lot of money in fraudulent or useless clicks.

What do you guys think? Would it cost too much to the advertiser?

More on this can be found in this press release: http://www.prweb.com/releases/2006/6/prweb403094.htm

I certainly makes sense in the battle to fight click fraud. Whether or not it will work will probably be in the details though I suspect it will. I would imagine advertisers will be paying much much more per action that they currently are per click and it still needs to be determined how it will work for publishers. Publishers will want to see at least a similar payout to them to use the ads.

Something tells me that both advertisers and publishers will end up being happy with the new ads. I would hope that Google still continues to use the pay-per-click model and offer pay-per-action as another option.

I'm not too excited about this. Sure, Google have the most powerful servers in the world and a whole load of happy staff at their disposal but they're not an affiliate network. They don't have the experience, trust or clientbase a real affiliate network have - tradedoubler, CJ or buy.at. On this one, it'd be nice to see Google fail as I think affiliate marketing is best controlled by those who do it best. It's also sad to see them try to take over another market to put the "little guys" (many of which aren't that little) out of business.

Conversely, tied in with the new Google payment thing, this could be a good thing. Buy shares now!

If google don't have experience in a field they will just buy a company that does, and import the staff from there.

I think the new per action ads are an attempt by Google to fight click fraud. A lot of advertisers have complained about getting charged for fruadulent clicks and this will give those advertisers another option. Action fraud is going to be harder to automate than click fraud. I'm not seeing this as a way for Google to become an affiliate marketer. At least I don't think that's their intent.

Google has to deal with fraud and this is one way to go. This is the problem with the pay-per-click system. Google's algorithm could be good but a customer will know when they are not selling anything but paying out for many clicks.