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"Pay-per-action advertising is a new pricing model that allows you to pay only for completed actions that you define, such as a lead, a sale, or a page view, after a user has clicked on your ad on a publisher's site," explained Rob Kniaz, a product manager for Pay-Per-Action, on Google's AdWords blog. "You'll define an action, set up conversion tracking, and create ads that publishers in the Google content network can then choose to place in new ad units on their site."
PPA advertisers set the price that they're willing to pay for specific actions, which could be a click, a purchase, or a sign-up, for example. Because advertisers are buying actions, which by definition conform to business goals, click fraud becomes far less of an issue.
PPA ads will appear only on AdSense sites, which is to say the sites of publishers in the Google content network.
Publishers have the option to run specific PPA ads or to let Google serve the ones that perform best in relation to a preset topic. Publishers can review available PPA ads by product name, description, logo, and designated actions to make sure selected ads suit the site.
The PPA beta test is available only to U.S. advertisers at the moment. In the coming weeks, Google intends to invite more advertisers and publishers into the program.