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Gary Angel brings over twenty years of experience in decision support, CRM, and software development, to SEMphonic. Gary co-founded SEMphonic and is president and chief technology officer. He's responsible for leading SEMphonic's development of Web analytics and SEM decision making tools for web marketing professionals. In addition, he helps companies like WebMD, Intuit, American Express and Charles Schwab maximize their web channel marketing through intelligent use of Enterprise Web Analytics

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Measuring the Intangibles: Don’t “Blink” Now, But You Might be Gravely Misoptimizing

Written on
April 2nd 2007
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by Gary Angel  |
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For many large clients, the web channel’s impact is heavily weighted toward intangibles. Much of the value of a web site is unrelated to online conversion. This simple fact is widely understood by most of the stakeholders in such sites — but poorly translated into a good measurement strategy. Many web sites with a very significant brand/marketing component are measured almost exclusively by their conversion performance.

That’s dangerous. Because measurement — if it isn’t ignored — drives change in particular directions. And if you are measuring only the conversion efficiency of your site, then pages and tools that drive to conversion will get all the attention. Pages and tools that may drive significant brand value will be ignored or even dropped. In the long run, this will lead your site to be poorly optimized — even when stakeholders are aware of the multiplicity of functions on the site.

This phenomenon of measurement driving misoptimization is surprisingly common. It appears regularly in Search Engine Marketing — whenever companies choose to optimize to clicks. And the potential for it exists whenever measurement has been focused on only one part of a larger picture. The inevitable human and organizational tendency is to optimize to the numbers you have.

So if you believe that branding/marketing is a significant function for your website, it’s imperative that you bake those concepts into your measurement in a way that will drive intelligent decision-making. To do this, you need to come up with a measure of branding/marketing that is:

• Weighted Appropriately vis-ÃÂ-vis Online Conversion
• Designed to encourage appropriate optimization
• Measurable using your tool set

I’ve ordered these starting with the most difficult first. Getting a handle on the value of a brand impression on the web is far from trivial. Many organizations have done media research in the past to understand the potential value of an “impression.” But such values — when taken from traditional media — may not apply particularly well to the web site. In addition, web site engagement is much more variable than with other forms of media. When a consumer watches TV or hears a radio spot — they pretty much have the same experience. Granted their level of attention may be dramatically different — but there is a sameness to the experience (as well as an outright impossibility to measure differences in engagement) that make it both necessary and plausible to establish a single value to the impression. The same cannot be said for the web — where the depth of engagement on the site is both visible and dramatically different by user.

There are several studies underway to try and measure the “brand” impact of various pieces of the web channel — including banners, search, and the web site. These studies track consumers over a long period of time for a single property and strive to measure the effect of each type of consumer interaction. Without denigrating the value of such studies, you should be cautious about assuming that whatever results they document are necessarily germane to you.

All too frequently, a single case-study becomes the conventional wisdom for an industry — with few people understanding just how variable real-world experience can actually be. A perfect example of this is the issue of Organic Cannibalization. When we’ve actually measured this, we’ve seen real-world experience ranging from organic listings actually supporting paid listings (as conventional wisdom says they should) to significantly (to the tune of 50% or more) cannibalizing it. And we’ve measured effects at pretty much every level in-between (See here for one example of this).

On a similar theme, a recent study of the effect of TiVO on buying habits (Advertising Age, March 5, 2007) revealed a wide range of impacts by brand — from significant declines in advertising effectiveness to virtually no impact. The researchers had theories why this was the case (type of program advertised on, effectiveness of advertising, cost-competitiveness of the market space), but these are really only guesses. And, as with so many real-world cases, the deep implication is that there was no one right answer applicable to every advertiser.

This drive to explain everything with one simple rule is everywhere. If you listen to reports on the stock market, you’ll hear the same impulse to simplistic explanation (and with a much higher nonsense factor) — the market was “spooked” by some piece of news or was “reacting to comments” by someone. Maybe. Maybe not. There’s always something to explain a movement, but in a market movements will inevitably occur and some outside fact can always be found to match. Variation happens.

So depending on the importance of this issue to your business, it may be worth investing in a tracking study of your own. If that’s too elaborate, then you’ll have to be satisfied with building a value answer out of a subjective weighting of key factors: the known value of a traditional media impression, survey research on the brand impact and satisfaction from web site usage, and the long-term study of website usage and retention.

Once you’ve decided on a relative weighting of branding/impressions vs. conversion, you’ll have to decide how to measure for that value. The key, in making this decision, is avoiding a measure that encourages misoptimization.



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