Definition

Online advertising payment model in which payment is based solely based on qualifying leads.

Information

In a pay per lead agreement, the advertiser only pays for leads generated at their destination site. No payment is made for visitors who don't sign up.

A lead is generally a signup involving contact information and perhaps some demographic information; it is typically a non-cash conversion event. A lead may consist of as little as an email address, or it may involve a detailed form covering multiple pages.

One risk to the advertiser is the potential for fraudulent activity by incentivized 3rd-parties or marketing partners. Some false leads are easy to spot. Nonetheless, it is advisable to make a regular audit of the results.

Definition

Online advertising payment model in which payment is based solely based on qualifying sales.

Information

In a pay per sale agreement, the advertiser only pays for sales generated by the destination site based on an agreed upon commission rate.

Paying per sale is often seen as the payment model most favorable to advertisers and least favorable to publishers. In such an agreement, the publisher must not only be concerned with the quality and quantity of his or her audience, but also the quality of the advertiser's creative units and destination site.

If possible, many publishers avoid sales-based agreements, preferring to stick to the CPM model. However, some publishers, facing weak ad sales, have little choice but to accept sales-based agreements to utilize remnant space.

For advertisers, pay per sale has some unique advantages compared to pay per click and pay per lead. There are fewer concerns about whether conversions are legitimate, and whether traffic is incentivized or of low quality.