Pay-per-action system for selling advertisements
A system is disclosed for a pay-per-action (PPA) advertising model. An advertiser reports actions and pays an advertising provider for each action that is reported. The payment may be based on the rate at which the actions are reported. The action rate may be updated based on each reported action, which may modify the payment for that action and may modify the payment for previous actions. A one-time premium may be charged to advertisers and a minimum action rate may be established to encourage advertisers to accurately report actions.
1. A computerized method for receiving a payment for displaying an advertisement comprising:
receiving a request from an advertiser for an advertisement to be displayed, wherein the request includes a bid amount;
calculating, with at least one processor, an action rate of actions per impressions, wherein the actions are taken after a click-through of the advertisement and the impressions are a number of times the advertisement is displayed; and
determining, with the at least one processor, a payment to be paid by the advertiser, wherein a difference between a threshold bid and a price per impression is calculated and the determined payment comprises the calculated difference divided by the action rate.
2. The method of claim 1 wherein the payment to be paid by the advertiser further comprises the bid amount.
3. The method of claim 1 wherein the price per impression is the smaller of the bid amount and the threshold bid, wherein the threshold bid is one of a reserve price or a second highest bid amount.
4. The method of claim 1 wherein the action comprises a subsequent interaction with a displayed page after a click on the advertisement displays the page.
5. The method of claim 1 further comprising:
receiving an indication of a first action;
receiving an indication of a second action;
determining, with the at least one processor, a number of impressions between the first and second actions; and
calculating, with the at least one processor, the action rate as the inverse of the number of impressions between the first and second actions.
6. The method of claim 5 wherein the action rate is updated upon receiving each indication of a subsequent action, wherein each subsequent action is divided by the number of impressions preceding the subsequent action.