30 July 2012
How exactly do you measure whether your online advertising is working? Nikki Cockcroft clarifies the truth behind the debate.
The measurement of online advertising is a contentious issue for a number of reasons. Firstly, what constitutes online advertising? Most people believe it is simply display banners and the controversy is predominantly around measurement of display and what makes a campaign successful. Over the past 11 years, new online advertising elements have come into play including: campaign web or mobile sites, video advertising, search advertising, social advertising, viral advertising, and most recently, video production.
In order to truly understand the success of the campaign, agencies and advertisers need to evaluate the objectives of the campaign, use the right mix of elements to deliver the campaign message and finally, apply the right measurement tools to each placement to truly gauge the success of the campaign.
Display advertising is generally measured by the click-through rate (CTR) and when I say generally, this makes up 85% of the campaigns run through the adserving networks. CTR is defined as a way of measuring the success of an online advertising campaign for a particular website. This definition is not really true. The CTR of an ad is defined as the number of clicks on an ad divided by the number of times the ad is served (impressions) as a percentage.
If it is a way to measure success, we can also similarly say in the traditional world that success can be measured by the seller if a customer walking through a store picks up a new product.
But what truly deems an online campaign successful is what happens post the user seeing or clicking on the ad, and the wonderful thing about online is that it can be measured. Most advertisers and agencies shy away from this post-click tracking and analysis as it is slightly more technical and requires extra effort and insight on the part of the agency and the advertiser.
For media owners, the daily phone calls from a media agency can be pretty much summed up as follows: “The CTR on campaign X is so much lower than the CTR on campaign Y.” Really? So this time you are trying to sell insurance and on the previous campaign you were driving traffic to the launch of a new retail site. Why should they be compared? It is not only obvious that the campaign objectives are entirely different but the creative, the placement and planning should also be very different, yielding a different result.
Another typical conversation is around the performance: “Campaign X is performing so much worse on your site in comparison to the other sites we are using”. On investigation, one finds that all related media owners have received the same phone call. Media planners should not be comparing one to the other, but instead have a measurement matrix with clearly pre-defined objectives and expectations for each placement. This means that instead of placing media on the biggest or most obvious destinations, you place media based on the expected results aligned with the campaign objectives.
In order to try and improve the so called ’disconnect‘ between advertisers, agencies and media owners we need to go back to basics. The most forgotten and most important step in the process is to understand the objectives of the campaign. They generally don’t involve a CTR, but instead include goals such as an increase in sales, traffic generation, brand awareness, registrations, reach and frequency. Once these have been established, the media agencies need to spend time assigning a digital metric to measure this success. Unlike other mediums, online advertising is measurable post the click.
There are debates around which measurement tool is best but most tools offer the ability to measure the results of the campaign using post-click tracking code which follows the user through the journey – monitoring the post-click drop off rates and ultimately the conversion. In addition, measuring the success of a campaign if someone has viewed the ad and not clicked on it, but gone back to complete the journey at a later stage, is commonly known as measuring ’view throughs‘ as opposed to ’click throughs‘.
There are various tools that are available through the likes of Google, ComScore, Doubleclick and ADTECH that offer this analysis. The truly smart systems and planners use these tools to not only assess the final outcome of the campaign, but to understand the actual audience composition reached by specific media buys to optimise publishers, placements and the creatives based on real-time performance. Also, in more advanced cases, to compare the performance of online versus offline media plans.
With the increasing attention on digital advertising, it’s time to start measuring the genuine results. Digital exposes the real conversion truths that can end up deterring advertisers from spending in the space. But it is the reason we are all playing in this game and it’s because of digital that traditional mediums are under pressure to prove themselves to be viable.
Nikki Cockcroft is the chairperson of the Digital Media and Marketing Association and the head of the Bookmark Awards (the digital media industry awards).