Opinion: Beyond the Click-Through

For the better part of the past 16 years, since we saw the very first ad online (AT&T on Hotwired), our industry has been nothing short of revolutionary. Data flows by the microsecond into machines, and we attempt to make sense of 1’s and 0’s to prove that online advertising “works” and positively contributes to the growth of any company and the health of a brand. More often than not, however, we haven’t been able to get out of our own way, and DR metrics pushed “up the funnel” continue to be one of the biggest impediments to true growth.

This is especially true of the click — that single infinitesimal metric ingrained in the hearts and minds of a generation of online marketers who had nothing else to lean on in its place, everything to lose without enough of them, and perhaps just a touch of jealousy for those folks at Google who do an awfully nice job to monetize them.

Some leading companies and start-ups have made valiant attempts to wean the buy-side from clicks. VideoEgg was one of the earliest companies on the sell side to start moving the discussion from CPM or CPC to cost-per-engagement.

Others, like Brickfish, followed suit. Betawave spends enormous resources and brainpower tackling the notion of attention. ComScore partnered with Starcom and Tacoda (in 2007) to issue and then reissue (in October 2009) the “Natural Born Clickers”‘ study to prove that just 8 percent of all people online account for 85 percent of the clicks. In November 2009, the IAB and Bain issued a seminal report entitled “Building Brands Online.” That report compiled the results of 700 interviews of leading U.S. marketers and decisively concluded that brand awareness, purchase intent, likelihood to recommend and favorability are the most important metrics for brand-building campaigns. 

If you went on the digital conference circuit today, you might think that we’ve grown up as an industry and have discovered there’s more than meets the click in online advertising.

But what we say is not what we do.

Despite the aforementioned efforts, countless RFPs continue to emanate from agencies large and small that cite CTR (click-through rate) as one of — if not the primary — success metric and way to measure branding campaigns and, further, comingle a need for CTR with commensurate requirements for lifts in brand equity values. Faced with a CTR challenge, algorithm jocks salivate at the opportunity to squeeze out more clicks from a campaign. Every sell-side company wants to hit that threshold level of CTR to “stay on the plan.” Some deploy armies of engineering talent to tackle the math behind the analysis that leads to particular types of regressions (or derivations thereof) and subsequent optimizations to find either more people who “look like clickers,” or sites and/or placements where clickers spend more of their time clicking.

While brand stewards can measure lifts in brand equity affected by online advertising via the usual suspects (e.g. comScore, Dynamic Logic, FactorTG, Insight Express, KN Dimestore and Vizu), until recently most didn’t have the commensurate tools and technology available to optimize campaigns toward brand metrics and bring math back to branding.

So what does branding math mean? First, as an industry we’ve had few opportunities to look at both sides of the campaign coin to fully understand the mathematical realities that can preclude the ability to squeeze clicks and brand lifts from the same pool of people (aka the “audience target” on an RFP).

However, Lotame has examined these cross-metric relationships and just introduced the first publicly available study of brand equity measures as they relate to clicks, interactivity and time spent.

We looked at 91 campaigns comprised of 600MM+ impressions, 77K+ survey respondents and multiple advertiser categories. We compared the correlation coefficients of each recorded metric, and counted brands metrics based on lifts from control to exposed generated per campaign for each metric.

Our findings should startle some. When looking at relationships involving click-through rate, while CTR shows positive correlation with brand favorability and weaker but still prevalent correlation with interaction rate, negative correlation occurs between click-through rate and intent to view (for campaigns involving TV shows or movies), ad recall, and time spent per exposure. Click-through rate also shows no appreciable correlation with purchase intent or awareness. The clear message is campaign optimization efforts-whatever they may be-designed to improve click-through rate will likely negatively impact intent to view and ad recall, and add little or no impact to purchase intent and awareness.

But all hope is not lost. It is important to note that for the most part, major brand metrics all show positive correlations with each other, which indicates that optimization toward any one of these brand metrics is likely to positively impact the others.

We do not believe that the industry will change overnight and CTR won’t ever appear like a scarlet acronym on the RFPs of the future. We are hopeful, however, that our analysis casts a new light on the need for more thoughtful audience segmentation pre-campaign to give media sellers large and small the best chance to align their optimization efforts to the right independent metrics. Clicks are but one metric in a sea of metrics, and when combined for analysis with brand equity measures we find them exposed for the limited value they represent when building brands online. –With contributions from Robert Jones, business analyst, Lotame.

Eric Porres is CMO of Lotame Solution. He can be reached at eric@lotame.com