Affiliate ad traders and the exchange model

More and more advertisers are favouring the CPA model in this tough economic environment. CPA is the marketer’s ROI weapon of choice at the minute.

It’s a difficult option for publishers already using CPM and CPC models: they allow brand advertising to run on their site but only earn revenue if a visitor clicks through and perform an action, such as a purchase or a subscription sign-up.

CPA is, however, perfect for affiliate networks. They specialise in converting web traffic into sales for its clients. And already have large networks of sites participating in their network.

The affiliate networks could easily pitch for this business from media agencies and client direct. But I also think that traders on the ad exchanges are well positioned to take advantage of the marketers move towards the CPA model?

The ad exchanges provide unique opportunities for performance-based media agencies to use the trading platform to maximise the success of its clients’ media buy. Using bid management tools and algorithms to trade ad inventory in real time, these new agencies can provide advertisers with effective and efficient online campaigns.

Could affiliate specialists replicate this success on the exchanges? Could the “affiliate ad” traders buy inventory across the exchanges, using similar tools and techniques to convert traffic into user actions?

The sheer size of ad inventory available on the exchanges would make it possible for specialists to successfully run CPA campaigns for clients. Developing processes and algorithms for trading could allow specialists to offer a unique proposition to potential advertisers.

The question is will it be performance-based media agencies or affiliates that take advantage of this growing advertising market?