Blog: A different approach to measurement will help advertisers and agencies give credit where it’s due


Our Guest Blogger, Giorgio Vildacci, Product Marketing Manager from Quantcast summarizes how a different approach to measurement can help advertisers and agencies give credit where credit is due.

As the industry matures, advertisers are increasingly investing in new ways to measure the impact of digital advertising in the customer journey. However, the way most companies measure online advertising campaigns today with all their sophisticated complexity and nuance still largely relies on models developed for the early, simpler days of search advertising.

Back then, it was pretty easy to see whether an ad was relevant to what a consumer was searching for: they clicked on it. But are we sure that this model is still suitable and takes into account the different roles that each of the marketing channels plays?

Using crude measures like clicks and its close relative ‘last touch’ to measure modern display ad campaigns and plan future investment on the back of those measurements is a bit like betting your life savings on a company’s stock because it went up one day. It’s a positive signal, but only part of a bigger picture.

Display advertising is inherently different to the search use case.

Consumers aren’t on sites just to click on ads. They’re there primarily to read news, find information, or be entertained. Yet clicks still get a larger share of attention than all the other potential signals brands could be looking at to measure campaign success. Why? Mostly because they’re comfortably familiar.

Similarly, applying a ‘last touch attribution’ to display often results in the wrong marketing mix. Retargeting is valued over prospecting to bring down the cost per acquisition. This skews the data and makes it look like retargeting is the most successful strategy, when it rarely is in isolation.

The obsession with last touch is also the driver of negative behaviours in the industry. If the race is on to acquire that last click, there is a risk that competing adtech companies on a brand’s media plan will hammer consumers with ads just before the purchase. This is a short-sighted approach that leads brands to spend more money than necessary in the lowest part of the purchase funnel, irritating consumers in the process.

An alternative approach

There’s a simple fix for this situation:

  • Evaluate the prospecting and retargeting tactics on a campaign separately, and set specific goals for each
  • Minimise the number of retargeting partners
  • Use more sophisticated allocation models than “last touch”

The last two principles are already in place or in the process of being implemented by a lot of brands. Splitting the sales funnel between prospecting and retargeting – the time before a consumer visits a brand site and afterwards – is a more novel approach.

Think of it like a relay race with two runners. Most advertisers spend all their time analysing

the second runner, the one who crosses the finish line. They ignore the first who may have done the hard work in winning the advantage. This imbalance of attention results in a distorted view of the effectiveness of different media.

By dividing marketing activity like this, brands get a better idea of where the value is coming from, and can more effectively direct budget. Making it work is simple: it’s just a case of having tracking tags on the website and campaign creative.

The benefits

This more enlightened measurement approach gives advertisers valuable new insights:

  • How each partner on the plan allocates budget between prospecting and retargeting
  • Identify over-investment in retargeting
  • Find the optimum levels of media activity for the prospecting and retargeting phases

By finding the inflection point where different activity levels are most effective, brands can release more budget to boost prospecting in order to generate tangible growth in new customers numbers, unlocking new sources of revenue.

Optimising the budget allocation between these two tactics can be critical to the ROI of a campaign. In addition, it will reveal the varying efficiency between prospecting partners and retargeting partners.

While the difference between effectiveness in retargeting partners on a media plan can be negligible, some prospecting approaches are 10x more efficient than others. In other words, there is much more variation between the speed and quality of the runners of the first phase of the relay than between the runners of the second phase.

Most advertisers would do well to devote more time and resources to optimising the top of the purchase funnel than to focus as much on the last moments before the sale.