ADOTAS – Online advertising is a different beast from its television and print counterparts. Display ads can be tracked and measured online, but to date, there isn’t a clear, universal metric to help marketers track effectiveness across all channels including desktop, tablet and mobile platforms.
Today, online advertisers have the ability to track a plethora of information, from impressions and clicks to engagement and time spent. The problem is that each of these baseline metrics change when applied to different ad delivery platforms. In an effort to get a state of the ad industry, online analytics company OptiMine today released a new report that examines how advertisers view the act of extracting insights from the pile of data captured via online ads. It polled digital advertisers to learn how measurement challenges affect them and how they are making decisions about their investments in display advertising.
“We’ve long been hearing from our own clients and industry leaders that display advertising, while perceived as valuable, is extremely hard to measure,” said Jim Moar (pictured), CEO of OptiMine. “We’ve spoken with advertisers across the spectrum — some acknowledging that they’re investing tens of millions of dollars in display, despite being forced to ‘spray and pray’ due to measurement challenges, while others are greatly limiting their investment in display because of measurement challenges.
The survey was conducted via an online questionnaire on ADOTAS targeting senior digital marketing executives. Key findings from the survey include:
- 61% of advertisers say it is difficult to reliably measure the value and ROI of display ads, while only 29% say they can reliably measure it.
- 51% of advertisers say they don’t invest or limit investment in display because of the challenges in reliably measuring its value.
- 61% of advertisers say that cookies do not meet all of their needs for measuring the value and ROI of display advertising.
- 68% of advertisers say they haven’t advertised on Facebook or Twitter or spend only a small portion of their budgets on new display channels such as these, because of the difficulties of reliably measuring ad value and ROI.
- 42% of advertisers rely on concrete metrics and proof of value and ROI to make budgeting decisions, while another 46% include these in their decisions along with anecdotal information and the popularity of a channel.
“The survey on ADOTAS reinforced the limitations with existing measurement approaches that rely on third-party cookies (e.g., attribution),” said Moar. ”As is widely known, cookies fall apart when it comes to tracking across devices (e.g., smartphones, tablets, etc.), which explains why so many respondents cite difficulties in accurately measuring the success of their display efforts. With an increasing number of consumers using multiple screens, the challenge of cross-channel measurement only continues to grow.”
OptiMine aims to resolve the challenges of measuring display’s value with a cross-channel approach, using display ad impression data for deeper analysis. Ad impression data is a natural source for measuring the value of display, as it matches the channel’s branding intent, is readily available data, and solves the multi-device problem. By modeling the relationship between each display ad’s impression volume (branding effect) and paid search keyword conversions (buying impact), advertisers can identify which display ads are impacting search keyword conversions — and by how much. Advertisers are then able to understand the true Value per Impression (VPI) for each display ad, and optimize their bids accordingly to maximize results.
According to a recent press release issued by the IAB, Internet ad revenues have hit a record-breaking level of double-digit growth, reaching nearly $37 billion beyond 2011 numbers. For the second year in a row, mobile advertising in particular achieved triple-digit year-over-year growth, surging to $2.4 billion. Despite this surge, findings from the OptiMine surveyindicate that there is still much room for improvement.
“Not all display ads are alike,” said Clark Fredericksen, VP of eMarketer. “Advertisers have different objectives and while some marketers have the goal of branding, others are focused on direct response. It is not for a lack of options that online measurement continues to be a challenge and there is still significant debate within the industry about which metrics are best. This, coupled with a fragmented media landscape have made it difficult to identify and use a single metric across all channels.”
Moar added: “The lively industry discussion in recent months about the future of cookies — the foundation of many existing measurement schemes — further highlighted the challenges around measuring display’s value using existing solutions. Our survey findings highlight the need for innovative approaches and new standards in the measurement of digital brand advertising, such as display. While third-party cookies indeed provide value in some contexts (remarketing, for example), the industry must rethink cookies’ role as the de facto standard for cross-channel measurement, given their inherent gaps in this context. New measurement standards are needed that address both the intent of particular advertising channels and the multi-device reality that is here to stay.”