Click-Through Rates 179% Higher Than You Think
Viewable Impressions to Redefine Display Advertising Performance in 2012
Executive Overview from C3 Metrics’ Labs
C3 Metrics analyzed a subset of several billion display impressions across its client base to determine what percentage of display ads are actually seen by consumers within industry standards for an “impression.” The data showed that 68% of all display ads analyzed, which are recorded by ad servers as impressions, were never actually seen by consumers. Because click-through rates, a primary metrics for display ad performance, are calculated based on impressions, C3 Metrics’ Labs report indicates that click-through reporting may be off by as much as 179%. This report underscores the need for display impression data beyond current standards, which record a server request as an impression yet provide no data on whether an ad fully loaded into the browser. Without that data, it is impossible to determine if the ad was ever seen by the consumer, and therefore leads to inaccurate reporting of display ad performance.
Advertising attribution models using 3PAS data mistakenly assume that 100% of ad impressions are seen. As the IAB, ANA and 4As move toward redefining an impression as an ad seen, CPMs for “seen” ads as defined by actual consumer views will set a new, higher norm for networks. As the industry migrates away from last click and last view attribution to Full Funnel Attribution®, ”viewable impressions” will become essential to plug the 68% industry gap.
Methodology
C3 Metrics examined several billion impressions across a subset of its client data collected in December, 2011. C3 Metrics’ proprietary decision engine provides Full Funnel Attribution modeling, capturing all online media sources from the top of the funnel, where sales are originate, to the conversion at the bottom of the funnel. With its clients’ display banners, C3 traffics an independent view-through pixel simultaneously so that display credit can be measured in real time and credited in all parts of the funnel versus only the very end of the funnel. Across several billion display impressions, C3 Metrics’ system determines:
a) when the display ad is fully loaded,
b) when the display ad comes into the view-port of the computer for at least one second,
c) and if the ad was served via standard javascript or iframe.
Results
The C3 Metrics’ Labs study found that 68% of the time, ads which get fully loaded are never actually seen by consumers. C3 Metrics also matched its data to third party ad server data, determining that only 88% of ads that get served, actually load completely on a user’s computer. Five percent of the time, ads are served by iframe, which indicates that it is not possible to determine whether those ads are seen or not.
C3 Metrics COO Jeff Greenfield said, “The viewable impression standards have arrived. There’s good news and bad news whenever a new standard is adopted, but the IAB, ANA, and 4As have pushed this standard, and ultimately more dollars will pour into digital advertising with new, precedent-setting accountability that CMOs and CFOs are looking for. Any agency failing to adopt the new standard will have click-through rates off by 179 percent, and from attribution modeling standpoint, will have models that are off by 68 percent.”
C3 Metrics’ Labs results underscore that, even when measured thoroughly with Full Funnel Attribution, any set of analytics that don’t incorporate data on viewable impressions will be severely flawed.
Conclusion
Based on its findings, C3 Metrics predicts that three things will begin to happen in 2012:
1) Click-through rates must be calculated on impressions viewed, not server requests.
2) Attribution modeling, which is critical to display success, must also incorporate the viewable impression standard, because view-through credit is entirely based on an actual view.
3) CPMs for viewable impressions will justifiably rise, and unviewed impressions will no longer count in display ad performance reporting.
With proper attribution modeling, advertisers can see far above the “last click/last view” residing at the very end of the funnel, and then allocate budget to channels that best originate and assist incremental revenue, using sound data.
C3 Metrics CEO Mark Hughes added, “As search matures in volume, display becomes a huge opportunity for brands and publishers. The key is measuring display accurately to drive value and optimize on sound data versus optimizing on ads that you’re not sure are seen. The impression standard is the key to all advertising whether it’s attribution modeling or creative optimization using click-through rate. 2012 is on the verge of a major shift in media metrics.”
Exit Strategy: 37% of Transactions Finish with Brand Search
Executive Overview
Digital marketers need an exit strategy — a purchase funnel exit strategy to be more exact. That’s one of the takeaways from the latest C3 Metrics’ Labs report for the second quarter of 2011. C3 Metrics analyzed a subset of data across its client base totaling 50,000 online transactions in Q2 to define the last interaction before a consumer exits the purchase funnel and transacts online. The data showed that 37% of all transactions ended with a brand term search as the very last action before purchase. Advertisers still using last click attribution models for ad measurement would attribute more than a third of media credit to search based on these results. However, when a purchase funnel finishes with a brand term search, it’s not causal to revenue…it’s simply navigational.
“Real causal influence comes from upper-funnel and mid-funnel marketing stimuli driving more consumer transactions all the way through the funnel, as seen with Full-Funnel Attribution™,” according to C3 Metrics CEO Mark Hughes.
Methodology
C3 Metrics examined 50,000 transactions across a subset of its client data collected in Q2, 2011. C3 Metrics’ proprietary decision engine provides full-funnel attribution modeling,
capturing all online media sources from the top of the funnel, where sales are originated, to the conversion at the bottom of the funnel. Across all 50,000 transactions analyzed, C3 Metrics determined originators, assists and last-position converters for each transaction at a granular level.
Results
The C3 Metrics’ Labs study found that in 37% of all online transactions analyzed, brand search was the very last media source as the consumer exited the purchase funnel. C3 Metrics CEO Mark Hughes elaborated, “If an advertiser is still using last click analytics, they would mistakenly think that brand search was responsible for a third of their results. But even if they wanted to scale that by tripling brand search budget, they couldn’t achieve revenue growth by increasing budget for non-causal media sources.”
Conclusion
Brand search is a mandatory must-have in online media, preventing competitors from conquesting customers away—but it’s often the exit point in a journey, not the starting point. C3 Metrics CEO added, “Imagine an Olympic relay race…if you gave a gold medal to just the last runner, the first three runners would be reduced to the same status as someone watching from the sidelines. In C3 Metrics’ attribution model, we record the last click, but when a brand term is the last position, we can deploy an algorithm attributing credit to the media source prior to the brand search. In our attribution model, not only can we track upper and mid-funnel insights, but we can attribute a truly actionable converter—not just a navigational endpoint.”
About C3 Metrics:
C3 Metrics is Attribution Made Simple. The C3 Metrics proprietary decision engine delivers actionable attribution modeling, allowing marketers to measure the true value of all marketing channels—making complex media analytics simple. Headquartered in New York, C3 Metrics provides a SaaS solution for agencies, brands and publishers to solve the “last click” and data overload problems of online marketing optimization. A two-year client case study for one of C3 Metrics’ advertising partners has demonstrated a 75 percent revenue increase versus baseline with only a 12 percent increase in advertising spend. For more information, visit: http://c3metrics.com.
Q1 C3 Metrics Labs
Display Originates 44% of Advertisers’ Q1 Transactions Using Attribution
C3 Metrics analyzed a subset of data across its client base totaling 50,000 online transactions to determine channels of media originating transactions. The data showed that nearly half of all transactions analyzed were originated by a display ad. This report underscores the role that display can play in driving initial interest and the value of investing in upper-funnel and mid-funnel tactics when finally capturing insights of Full-Funnel Attribution™.
