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Per-inquiry advertising (PI) – also known variously as cost per lead (CPL), pay per lead (PPL), cost per action or cost per acquisition (CPA) - is a form of direct response marketing in which the advertiser receives free ad time and space while paying only for results. In return, the advertiser gives up control of where and when the ads will run.
Agencies that offer PI have relationships with media outlets – radio, television, print, Internet, movie screens and billboards – and access to their unsold inventory of ad time and space. The agency acquires the rights to the unsold time and/or space and places the ads as they become available.
The concept of PI was first used by Tony Alberti for the Stardust Hotel and Casino where Stardust provided weekends at the hotel and casino for network executives or advertisers in exchange for airing Stardust's commercials. It has since morphed into the current model where advertisers pay only for qualified responses to the advertiser's offer. What constitutes a response is negotiated between client and PI advertising agency. Packages can be structured for a variety of results: per inquiry (any response), per lead (name and contact information), or per sale.
For PI to work, the responses must be trackable. Some PI advertising firms also provide exclusive toll-free numbers and Web addresses for potential customers to respond. Some firms provide field responses and arrange fulfillment on behalf of their clients.
PI appeals to clients who care about how well their advertising works, not necessarily when or where it runs. It allows companies to boost business without the usual risks associated with advertising and establish stable, predictable CPL within their business plans, ensuring a positive return on investment (ROI).