Ask any online marketer -- they've mostly likely had a conversation along these lines:
Marketer: "Our latest online campaign resulted in a high ROI, and revenue of $15,700."
Marketer's boss: "That's great! What was the click-through rate of the campaign?"
Marketer: "Well, it's below our average, but when you look at site visits and sales, this campaign was overall more successful than normal."
Marketer's boss: "We were running three offline campaigns and two other online campaigns at the same time. You are probably just seeing a lift due to those, since it had a low click-through rate, right? If people didn't click, they probably only came to our site due to the exposure the other campaigns created."
This conversation is incredibly frustrating for online marketers. You think you have a successful campaign, but your typical CTR metric doesn't support that assumption. This isn't to say that measuring clicks is never appropriate. Click tracking is still the easiest way to measure the success of paid search because the ad is what customers are looking for when they search, and clicking on it is the easiest way to get where they want to go online.
Display advertising is fundamentally different than paid search. It's interruptive by nature! Web customers happen upon your display ads while browsing the web. The hope is that they will stop what they are doing and click on your ads. That's the hope, but that isn't what occurs most of the time.
A recent study by comScore revealed that 85 percent of all display clicks are driven by only one-third of online users -- referred to as heavy clickers. This means that the majority of your audience is not going to click on your display ads. The majority of the prospects that want to visit your site after viewing one of your ads will generally choose to open a separate browser tab and navigate directly to your site, or use a search engine as a navigational tool to find you.
We're at a crossroads. Clicks are safe and measureable, so it makes sense to measure clicks. At the same time, less people are clicking on ads, so then it doesn't make sense to measure clicks. How do you measure campaign success when you can't track a click? This is a major issue that hits the entire industry.
Let me introduce you to the view-through conversion (VTC). A VTC takes place when an ad is viewed, and though the web user does not click on the ad, they come back to your site later and convert. VTCs are not a new metric, but they are gaining in importance as clicks decline. In fact, Google announced in August that it will begin measuring VTCs in coming months, as it is seeing clicks decline overall online, but Google understands that there is value without a click, and they want a piece of that pie. The challenge for marketers is proving that when a person sees and ad and doesn't click, that you should give the ad they viewed credit for the conversion.
I'll be the first to admit that no innovative, scalable solution to measuring VTCs has been proposed. You can work with vendors to measure VTCs, but that is a one-off solution for each of your vendors that will require a lot of work that some vendors may not be able to support.
Here is a list of what to do when dealing with VTCs:
Control groups
Identify or create a control group, and do not show them display ads as they surf the web. See if individuals who view your display ads convert at the same rate or higher than those who do not. If they consistently convert more often, it is safe to say that viewing ads, even without clicking on them, is increasing your conversion rates. If you measure the rate at which they are converting, then you can confidently say that VTCs increase your conversions by X percent.
Analytics are key
Vendors that tell you they will be charging you based on VTCs should offer detailed analytics to support their validity and importance. If you are working with a vendor who doesn't, I would challenge them to begin doing so. Providing the analytics to support the effectiveness of VTCs will not only help clients understand the importance of VTCs, but will also help others in the industry to measure and embrace them. All too often I hear conversations around VTCs that include statements like "I'll give you credit for 25 percent of VTCs because I'm not really sure if the VTC metric is accurate." It's dangerous to use assumptions when dealing with success metrics. Look for the truth (read: data and analytics) in understanding how a prospect responds when viewing the ad versus those who don't.
Focusing only on CTRs is outdated
If you find yourself measuring only CTRs, it's time to expand your horizons. If you are working with a vendor who only attributes success to clicks, it's time to challenge them to look deeper. If you want to grow in the industry and stay competitive, you have to learn how to measure, report and find value in beyond the click. The easiest way to increase your confidence is through data and analytics, and as online display advertising grows, service providers will have to create those solutions for marketers. Until then, the best thing you can do is to press the importance of gaining additional data that confirms or disproves the value of the media in respect to VTCs.
Watch for improvements in other campaigns
Most marketers realize that when you measure VTCs, it is hard to comfortably give credit to the viewed ad as what caused the conversion. If a customer views three ads, the most common thought would be to credit the last ad viewed as the one responsible for their conversion. That method of thinking is not always correct. Think of it like this: a customer visits your website after they read about your products. They leave without purchasing, but later use Google to navigate back to your site to purchase. Google shouldn't receive 100 percent credit for that conversion. The customer used Google as a navigation tool to find their way back to your site; yet these types of conversions happen every day and Google is given full credit for them. So what a marketer will see is an increase in conversions in their Google paid search campaign. You may also see more direct traffic coming to your website as customers will remember that they saw your ad, and navigate back directly to purchase. The last ad viewed by a customer deserves some weight but not full responsibility. Atlas has started to address this issue in its engagement mapping. I predict in the future, as VTCs become more common place, that measurement tools will become available for marketers to better measure where to give credit for conversions. In the meantime, pay attention to the overall conversion rate of your site, conversion rates on existing campaigns, and don't add too many new marketing variables into the mix at once so you can keep track of these increases.
The market is due for new solutions that help marketers track conversions by looking beyond the click. There's a lot of value in highly-targeted display ads that increase your conversion rates that can't be tracked via click. This is an exciting time where we have the analytics to help us make informed marketing decisions. Be innovative by using some of the ideas I've mentioned, but I also believe that marketers and service providers need to push traditional boundaries of how campaign success has been measured.
Chad Little is the CEO of FetchBack.
