The Team seems to be celebrating this new consumptive keyword addition. It is great that a consumptive use has finally been enabled but I am less than thrilled by the execution and lack of attention to community suggestions.
We have been discussing a new model for almost 2 years and when I learned the team was actually going to build something I started this dedicated thread back in Jan to provide input and ideas for a more successful rollout. You can see that here.
Now that we know a bit of the details of this rollout its time to be critical and look at the model and if the communities suggestions would be better for all.
What I understand about this new current model with consumptive utility:
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It is exactly the same as the old staking with winner takes all. Only the highest stake will be viewed and when we say viewed the team has moved those ads to the bottom of the organic page results so IMHO it is not getting viewed and destroys a once GREAT USP for the project. A USP that allows anyone from the community to actually stake and provide a better search result for the users that may otherwise never be seen due to other search providers censorship. Also it could be used as free advertising and sometimes had non-relevant JV ads.
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No changes were added or updates to improve usability for advertisers (stakers or consumptive it is exactly the same as before).
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In order to actually pay PRE consumptively for an ad to move from the bottom of the organic search results to the top spot you now must be the highest stake on any given keyword. In some cases this is only 100 PRE and not a big deal in others tens or hundreds of thousands of PRE would be required to stake first before you could even PAY the Treasury anything. This is a huge problem as you are in many cases with competitive keywords locking out many potential consumptive bids.
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The cost of getting your ad viewed is = highest stake amount + a 2% /month consumptive fee.
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The consumptive fee is a flat rate of PRE based on the stake so in cases of low viewed keywords this may provide more income to the project but at the expense of a much higher cost than the advertiser is able to get value from. In this case due to the thoughtless rollout some advertisers will feel ripped off and leave never to return and certainly won’t be referring anyone to PREsearch losing a potential customer.
In other cases with very high viewed keywords the advertisers may be getting a steal of a deal and not have very much competition. But without competition and a more competitive well developed model PREsearch is leaving way too much money on the table than they otherwise would earn.
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So how do we fix these flaws bringing back a POWERFUL anti-censorship USP. Great competitive ad sandtable for staking combined with a competitive consumptive bidding model all competing for the top spot.
If you read my previous posts I laid this out. The basics are a winner takes most staking model with a reasonable 1-time fee for every new stake (people should pay something for the benefit of getting viewed in the top spot).
Combine this with a separate Consumptive bidding option again winner takes most. Whereby both staking and bidding are competing for the same top spot. or #2 spot if the team develops other better income producing ad options in the future. Of note if there is no stakes on a keyword the consumptive gets 100% of views and vice versa. If there are both stakes and consumptive bids the views are split in a percentage that benefit the consumption of PRE.
The below is an example of how this would work with all the relevant assumptions. I will post comparative results for a low 1k views /month assumption, 10k /month, and 100k /month.
As you can see from this 1k assumption in a good case the advertiser is incurring an extremely high cost per thousand views (CPM) of $26 and in a worst case scenario with only a 100 stake a crazy good CPM of $0.05 or only 2 PRE. The inconsistency even with zero competition is horrible. But you will notice in both scenarios my recommended model brings in more income or PRE to the Treasury and does it in a fair and consistent way. Although on the bidding side in a good case my model underperforms the blanket 2% fee by 23 PRE the 1-time staking fees of 2000 PRE more than covers the difference. And this does not make a potential advertising client feel ripped off.
From here forward my model destroys what the team has devised in terms of consistency, fairness, and importantly INCOME. On a single keyword producing 10k views a month my model earns anywhere from 1161.85 (worst case) to 10769.71 (good case) more PRE than the teams inconsistent model. If the CMP needs to be a lower minimum you could lower it dramatically and still beat the teams model.
In this 100k views /month example my model produces far superior results. Beating the team model by 11546 PRE (worst case) and 98,697 PRE (good case) income to treasury on a single keyword.
I should also note that this model restores the once great keyword staking USP and locks up in stakes potentially 64k more PRE again on a single keyword.
Imagine testing 5 variations of ads on a single keyword for comparison stats then using that to determine your best strategy for consumptive bids. This model lets everyone even the small guy get a fair amount of views. This lets small guys compete with the big players leveling the playing field. It lets consumption of any minimal amount potentially beat someone with hundreds of thousands of PRE staked encouraging stakers to participate in the consumptive bidding and vice versa.
Now imagine the potential volume during an election year on keywords like Trump, Biden, RFK, BTC, Bitcoin, etc. I could see single keywords getting not tens but hundreds of stakes and bids at crucial times. The team’s model would leave all that on the table. This is a single dev project that has massive future potential and does not prevent the team from exploring other ad options like my other ideas for ad slot ownership for locations and different types of ads.
The great thing about this model once developed and launched is it will more than pay for itself over time scales with user growth and can be easily tweaked to raise or lower the CPM minimum or change the percentages to better support all parties.
Lastly, this model does not completely fix the JV ad problem but the most competitive stakers and bids would get the majority of views likely being the most professional. This also ensures diversity of ads seen by users instead of the same ads all the time. So although not a complete fix definitely a much improved user experience, that still allows for anyone to easily participate. And that last part is the KEY and a huge differentiator from the corrupt Google and Bings!