Google announced plans to begin a test of CPC-based ads using the site targeting feature. Site targeting allows advertisers to choose individual sites in the content network where they want their ads to appear. Since it launched nearly two years ago, the program has used bids placed on a cost-per-thousand impressions (CPM) basis. That will begin to change in March, when a limited set of U.S. advertisers will have the option of paying on a cost-per-click (CPC) basis.
Google expects the CPC pricing to appeal to conversion-oriented, direct response advertisers who are focused on clicks, and track metrics such as sales, leads or sign-ups. That may get more advertisers interested in the tool, since many have tried site targeting on a CPM basis and found it lacking in ROI. Site targeting is popular with advertisers as a branding buy, when they want to get in front of the readers of a given site.