Performance-based advertising can be tricky to measure accurately due to the reputation of the product being advertised and the effectiveness of the advertising outlet. A study looked at how these factors affect the signaling function of advertising and found two paradoxes: higher product reputation may not always help advertising, and more effective advertising can actually hinder signaling. A new payment scheme was proposed to address these issues, showing that high product reputation can limit advertising reach, and efforts to separate product performance from advertising effectiveness may not always be beneficial. These findings provide insights for firms on choosing advertising outlets.