Babel Novel
Chapter 528
Gareth quickly agreed, "That's right, Owen. It's no big deal since we're all friends here. Just be more cautious in public, especially at important business events. Be extra careful with your words and actions on those occasions."
Owen blushed and nodded.
"Got it. Thanks for the advice, Gareth."
Changing the topic, Carlisle said, "Sean, didn't you get an advertisement deal? What kind of ad is it, and how much are they paying?"
Stretching out his leg, Sean pointed at the logo on the side of his grey chunky boots and said, "It's Fortbird. They're offering us five million a year."
Fortbird was a well-known domestic shoe brand and a prominent company from Midew State. At its peak, it had over three thousand branches and a market value of 40 billion. It was crowned the king of domestic shoe brands.Published by Nôv'elD/rama.Org.
"Did you accept it?" Carlisle asked, sipping his tea.
Five million in advertisement fees was no small amount. In Riverland, there were tens of thousands of businesses, but only a few thousand of them could exceed five million in annual profit.
Nevertheless, Carlisle wasn't entirely satisfied with Fortbird's offer. Based on his estimate, Alumni Network would have had more than ten million registered users by the end of the month. Yet, Fortbird's proposed advertisement fee seemed to be based on an estimate of only three million users.
"Not yet. This is a big deal. I definitely need your advice before moving forward!"
Sean grinned.
"Five million, Carl. That's a huge step forward!"
Sipping his drink, Gareth casually remarked, "We've already invested over 20 million into Alumni Network. Five million only covers a quarter of that!"
Sean argued, "In other words, I only need another three advertisement deals to break even in a year!"
Carlisle pondered momentarily before saying, "Five million is a bit low. I think we should consider charging them by cost per click, or CPC for short."
"CPC? Won't we end up losing money with that?" Sean asked.
He was familiar with the four ad pricing models:
"Cost per Impression" (CPI) would be charged according to the number of times the ad was displayed, per impression, or per thousand impressions.
"Cost per Click" (CPC) would be charged according to the number of times the ad was clicked.
"Cost per Action" (CPA) would be charged according to specific actions taken after seeing the ad, such as downloads or purchases.
"Cost per Duration" (CPD) would be charged according to the length of time the ad was displayed, either monthly or annually.
Fortbird and Alumni Network were discussing a CPD model with annual payments. Sean thought it was a decent model. Regardless of the ad performance, his company would receive five million in payment.
Since he wasn't a fan of online ads himself, he worried that Alumni Network's users wouldn't click on the ads, potentially resulting in low CPC revenue.
"Don't worry. Let's go with the CPC model at 0.04 cents per click," Carlisle said.
"...I don't quite get it. With CPC, clicks from the same IP address are only considered as one click. We have three million users now. Even if all our users click on the ad, it would only give us a sum of nine hundred thousand dollars."
Sean was puzzled. A person as intelligent as Carlisle surely understood the maths, right?
Carlisle picked up a piece of salmon to grill and explained, "To ensure a good user experience, we can't have too many ads on Alumni Network. I can accept two ad slots at most. In other words, if we charge annually, we can only accept two ads a year.
"However, with the CPC model, we can accept and rotate multiple ads. We might only have three million users now, but what if we get five or even eight million users this month?"