• by Shankar Gupta , October 3, 2005

Financial site BankRate.com Saturday implemented a pay-per-click pricing system for its interest rate advertising service. Previously, the service was available to banks for a flat fee, based on location and loan amount.

"Some of our customers have been asking for it--certainly the ones who are the lower-volume generators, who are paying the same as the people who generate an enormous number of clicks," said BankRate.com CEO Thomas Evans. "This is our attempt to make it more equitable, and more in line with what is currently the Internet dynamic, where people who are using paid search are becoming more and more familiar with 'pay for what you get.'"

Under the new payment model, placements in the mortgage interest rate tables range from $1.75 to $5.25 per click. The cost for other financial service listings ranges from $1.75 to $6.00 per click. According to the Fathom Keyword Price Index, the average cost per click for mortgage-related search terms on major search engines in August was $3.81.

BankRate.com, unlike many cost-per-click ad sellers, will not be utilizing a keyword bidding system. Instead, all advertisers will pay the same cost-per-click rate. When listings are displayed to a given user, the ads are shown in random order. The user can then sort the results by APR rate, FICO range, and fees and conditions, and other features.

To combat click fraud, BankRate.com outsourced auditing duties to a company Evans described as a major firm. He declined to name the company. Evans added that BankRate.com's experience in the market will help to promote awareness of aberrant click activity. "We have years of history--counting clicks and knowing how a particular lender or a particular product on bankrate gets clicks is not new to us," he said. "We'll be able to look at it and see if there are any out-of-pattern activities."