Metric-ulous Madness: Can Measuring Everything in Digital Advertising Hold Back Business Growth?
Today’s digital marketer has more tools available to measure advertising campaigns than ever before. But ultimately, what should matter most is how campaigns impact incremental growth and sales. In this Q&A, Ellie Lane, head of client strategy at Quantcast, explores how marketers should focus their efforts.
Digital media measurement allows marketers to understand every aspect of their advertising efforts in amazing detail, creating incredible potential for accountability. How do you think this capability impacts ad spend?
It’s easy to get lost in jargon, obsess over every data point, and end up forgetting about the bottom line. Instead, marketers should focus on measuring what matters. Step back from spending on plans that primarily drive hygiene metrics like CTR and viewability. For example, even a campaign served with 100% viewability, isn’t a guaranteed success. Viewability as defined by the Media Ratings Council doesn’t necessarily mean a consumer is actually looking at the ad on their screen, or that they’re the right audience for your product.
What is the significance of the “click” metric as a measure of success in display/brand advertising across the open internet?
As with all advertising, there’s no one size fits all approach. The click metric is hugely helpful in search advertising, for example, but less so for digital display. The search audience is actively seeking links for their next browsing destination, expecting to click when they find what they are looking for. Because a search ad relates to an intent expressed by the user, click metrics such as CTR (click-through rate) and CPC (cost-per-click) are reliable guides for marketers buying search ads.
Now consider the audience viewing a digital display ad. Perhaps that person is researching a holiday trip, paying a utility bill, looking up a cake recipe, or reading the news. How likely are they to stop what they’re doing and click through on your display ad? In fact, an eMarketer study estimated that the average CTR on display ads is only 0.47%. Similarly, CNBC reported that 50% of display ad clicks are accidental!
So it’s fair to say, the click metric is a poor proxy for understanding and measuring the performance of your digital display campaign – and tracking and analysing it is an inadequate use of time and resources. Quantcast even produced a white paper about the fact that clickers are not converters. We found that over 95% of display conversions come from users that never actually clicked on the ad.
So if not clicks, which metrics or KPIs are the most relevant for assessing the impact of display advertising on business growth and sales?
The most pertinent metrics are Cost per Acquisition (CPA) and Return on Ad Spend (ROAS) for lower-funnel campaigns and brand lift (which encompasses a variety of relevant brand metrics) for upper-funnel campaigns.
For lower-funnel campaigns, the cost element is important – i.e., how much was spent to achieve that number of sales or amount of revenue. Looking at absolute numbers can be misleading and mask the efficiency (or lack thereof) in the campaign.
Cost metrics are less relevant for upper-funnel campaigns than brand lift, which is more specific to your intended audience. If you spend more, you’ll generally get more reach and achieve brand lift across a larger audience. A relevant metric here would be Cost Per Unique User for your target audience, though that is still secondary to brand lift. If there was a very low CPU but no brand lift, you still haven’t done the job and maybe more frequency or a different creative execution is required.
The difference between these metrics and clicks is that whether they measure direct sales or brand health, they both affect a business’ bottom line.
Can you tell us a bit more about how Quantcast helps brands be more accountable?
Clients often tell us that they find it difficult to justify brand spend as those campaigns don’t drive direct sales. It’s an age-old problem – marketers know brand spend has an impact, especially in the longer term, but it can be hard to convince your CFO of this when there is no immediate ROI.
Fortunately, Quantcast has developed a brand overlap report that allows clients who have run both their brand and DR campaigns on the Quantcast Platform to understand the effect their brand campaign has had on lower-funnel metrics such as site visits and conversions. Linking campaign performance in this way is a great first step in justifying brand spend and regularly helps our clients overcome internal resistance.
How will Chrome’s move towards a cookieless environment impact measurement for marketers? What questions should they be asking their tech partners?
The long-awaited deprecation of cookies on Chrome (already a reality for Safari and Firefox) has now begun. Marketers should therefore be concerned about how they find, reach, and measure their most valuable audiences in light of this data signal loss. Legacy DSPs won’t be able to monitor reach and frequency, track performance, or personalise ads. Attribution methodologies, such as multi-touch, last-touch, and last-click, which already have limitations, are becoming less reliable by the day.
That means that marketers need to adopt more advanced, multi-signal approaches that fully leverage real-time data to create dependable predictive models for their campaigns. They should ask their ad tech partners:
- How are they currently reaching and engaging audiences whose browsers don’t support third-party cookies?
- How are they measuring campaign performance in these environments?
- What kind of results have they achieved with their cookieless approaches? How future-proofed are their solutions?
Vertically integrated ad platforms, like Quantcast, are not dependent on third-party data signals. We can provide marketers with a real-time understanding and measurement of consumer activity as well as the ability to confidently deliver relevant advertising in the fast-paced, dynamic digital ecosystem of today – and tomorrow.