Pay For Performance (P4P)

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P4P is an abbreviation of the term “Pay For Performance”. The concept was invented at Overture and later adopted by their competitors, most famously Google’s AdWords. Under the model advertisers bid on the rights to present a search result for a specific search terms in an open auction. When someone enters a search term that has been bid on, the results from the auction on that search term are presented, ranked from highest bid to lowest.

When this idea was first introduced, there was a lot of controversy. Many felt that the results would be irrelevant, but the auction model has proven to be quite effective at producing relevant results for searches where you want to buy something. P4P is now seen as the most efficient and effective way to monetize search engines.

Licensed under the GNU Free Documentation License. It uses materials from the Wikipedia.

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