Flashback: Content in the Early Days of the Internet

Did you know that before “the king” of search engines (Google) arrived on the scene and changed the economics of online advertising forever, there were many more before it? In fact, the search engine marketplace was a very crowded place with:

• Excite (1993)
• Yahoo (1994)
• Webcrawler (1994)
• Lycos (1994)
• Infoseek (1994)
• Altavista (1995)
• Inktomi (1996)
• Ask Jeeves (1997)

Given how small the Internet advertising market was back then (mainstream national advertisers didn’t start advertising meaningfully until the early 2000’s), these search engines got a lot of the existing ad dollars that were out there, but struggled to both figure out the best financial model to sell advertising, as well as to make any kind of meaningful profit.

As well, mainstream traditional publishers and content providers (think print or broadcast) were poorly represented online in the 90s and the early adopters of the web were all also confused on exactly how to monetize their efforts. Some instituted paywalls, where you had to buy a subscription to access content, others tried sponsorships where you paid a fixed amount for your ad to appear on the homepage of a site, for example.  The pay-per-click model was just one of the options back then and had few fans for the obvious reason that content publishers, and even search engines, couldn’t make enough money to support the immense costs of creating, promoting and managing a web presence when simply getting paid when someone clicked a banner ad or filled out a form (pay-for-performance). Many were not keen to leave the traditional financial model for advertising as exemplified by  traditional print advertising. Trying to convert this model to  the web was difficult:  impression-based advertising models began where advertisers paid per viewer of the page where your advertisement was displayed was laregely untested. And very quickly it became apparent that  there were many problems with this model and how it worked online:

1. There was no method for measuring the efficacy of the ads on this platform. The content providers wanted to serve the ads for business and technological reasons and security was another big factor. If third-party servers were involved, there was always the chance that the publisher was hosting a broken GIF, which did not look good. This also took the control away from the content provider and gave it to the third party to place and manage the ad, as well as provide the measurements.
2. Again, there simply wasn’t enough traffic to support the costs of building that web presence for all that undertook the endeavour-- sites which could exceed $1 million in start-up expenses. The traffic that was there was a lot different than it is today—much less mainstream and more of only early adopters. It included users who liked clicking ads, just for the sake of novelty and not because it was relevant!
3. Other models were also struggling to get traction. For example, as most web content was free, users were very unwilling to pay for a subscription, especially if it didn’t include the full content available through traditional methods (i.e., print). 

With all of this seemingly up in the air, Google swooped in to “save” the day; they consolidated the search engine market and eventually is one of the main reasons why the pay-per-click model is so prevalent today. In many ways this model is a “least common denominator” because pay-per-click is easy to measure and has a defined and actionable result. With Google gaining significant and dominant market share in the mid-to-late 2000’s and strongly promoting this financial model, it is no wonder that pay-per-click survives as the most ubiquitous ad model for current search advertising but still permeates all types of web-based content presentation.

While pay-for-performance is the dominant financial model for B2B IT lead generation, for example, there are still great differences between what constitutes a great pay-for-performance lead and a lead of little value. The devils is in the so-called details at this point and lead buyers must be very cautious when it comes to evaluating options that may seem the same, given the same financial model. TCIMS can help any marketer get the best results utilizing this model. For more information, check out our website.