As publishers reevaluate how they structure their business models, and agencies look for new ways to create more value for their clients' brands, the two businesses are starting to have collaborative discussions surrounding value and price. Agencies are placing emphasis on value, publishers are focused on delivering that value, and both parties want the price point to match accordingly.
When negotiating with a publisher, two top-level metrics are all that count: the inputs (how much advertising space is being bought) and the outputs (which outcomes are being created).
Traditionally, inputs are measured by volume (as in, how much exposure the clients' brand will get) or how many people will see the brand and where. Publishers sell the inventory on their site on a volume basis and generally don't include the bounce rate (how many visitors land on a page and leave almost immediately) when providing visitor numbers.
They are instead counted as a unique visitor in the website stats and included in the sales pitch to the advertiser. But as an agency, are you willing to pay for a visitor who looks at a page for less than 20 seconds? The answer is likely to be no, and so it should be. Bounced visitors should be excluded from pre-sales visitor numbers and CPM deals to increase the accuracy of input.
On the other hand, too little attention is often given to accurately measuring outcomes, even though this is an area where we are supposed to understand value. Along with the metrics that are traditionally used, the following will provide a broader view of the campaign and better insight into the value being delivered by each publisher:
- Measure beyond a success event: Hopefully a spotlight tag will have been implemented on the brand's site to measure the pre-determined success event, such as how many sign ups, purchases, or registrations the campaign resulted in. While this metric is important, it actually only tells a portion of the story, and could lead to misleading analysis. It's important to ask and consider what happened to the other clicks. What did they do on your site if their visit did not lead to a successful event (a purchase, for instance) and how long were they there? Or is there a common point at which they leave? Combining web analytics data with ad serving metrics provides an agency with advanced insights into its campaigns. These broader insights lead to better leverage with publishers.
- Campaign measurement with customer segmentation: Which publishers bring you the most valuable customers? Which publishers reach your most loyal customers? And which are creating the highest amount of new customers? Rates and offers should be aligned with the kind of customer the publisher is reaching. Trending these data over time to build up a bank of possible niche publishers that drive high-value clients to counterbalance those publishers that drive lower-value clients leads to smarter media buys and better value from publishers.
- Campaign stacking: Before you cut or increase your spend on a campaign, try to understand its role within the bigger picture. Using web analytics across multiple channels and campaigns, you can understand the progression of events before a purchase occurs and their relationship to one another. You begin to see the bigger picture and are able to act on it. You can track a customer that lands on your site from a display ad on The Economist, for instance, and then follow the path that same customer takes a week later when he or she visits your site through Google paid search and makes a purchase. If you were to attribute the success to only Google, you might reduce media spend on The Economist and find that sales drop over time.
By adding these metrics into the mix, agencies will be better able to analyze and interpret the value each publisher is contributing. They will be able to make changes to their media buying practices according to this value. Value-based negotiations with publishers are already happening, and these metrics can help guide the discussion.
Chris Neuner is the SVP of agency solutions at Acceleration.
On Twitter? Follow iMedia Connection at @iMediaTweet.