If there is one group that has pulled back on their budgets of late, it's the group that spends their money on online advertising. Over the past few months there has certainly been a decline in online spend by many advertisers. Most would agree that the reason for the pull back in online spend is because of the current state of the economy. But to me, it's much more than that. While I agree the economy has played a major role in reduced online spend budgets, I can't put all of the blame on it. In my opinion, a lot of the blame needs to go to the lack of helpful online advertising measuring tools.
Can you really blame an online advertiser for pulling back their spend budget when they can't really measure the true value or success of their campaigns??
But what about all of those web analytics solutions that are available in the market? Shouldn't online advertisers be using those to help them understand the success of their campaigns? Sure, and many advertisers do try and use web analytics solutions as a way to to help them out. But those solutions, in my opinion, only go so far in helping an advertiser out with making crucial online campaign budgeting decisions. The problem with current web analytics solutions is that there's been too much focus put on web page measurement and not enough focus put on online advertising measurement (and online advertising is where a bulk of the money is being spent). Also, many of the web analytics solutions don't provide the much needed campaign attribution metrics that online advertisers desperately need in order to make actionable decisions about their campaigns.
With that said, I thought I'd include my post that I wrote for the official Yahoo! Search Marketing Blog. Here I discuss the value in using an online advertising measurement solution ('Full Analytics' from Yahoo!) that will help out any online advertiser in making smarter and more actionable online budgeting solutions during these tough economic times........
Have you ever stayed away from display advertising in favor of search ads because you believed that your display ads don’t perform well? You’re not alone.
Some advertisers have shifted display marketing dollars toward search with the belief that search advertising is “more measurable” and that it provides a higher return-on-investment.
While we think there are lots of great reasons to invest in search advertising, we also believe that display ads can be powerful and effective in driving traffic to your site. So let’s take a closer look at two common beliefs about display ads.
Belief 1: Search ads are more measurable than display ads
When it comes to measuring the performance of your search and display ads, the question shouldn’t be about whether one is more measurable than the other. The real problem is advertisers often don’t use the right metrics to measure the success and value of their display ads and search campaigns.
Specifically, many advertisers primarily use conversion percentage to measure the success of their display ads and search keywords. For example, if a display ad converts poorly (it has a low conversion percentage) then the advertiser typically lowers the budget for the ad, shifts the budget to another channel like search, or pulls the budget entirely.
The problem with only using the conversion metric method is that it is a “last click” metric. “Last click” means that the ad only gets credit for the last click the visitor made before they converted. For display ad and search keyword purposes, a last-click model doesn’t reveal the true value of the ad. For example, a display or search ad wouldn’t get the credit for driving conversions to other campaigns. This can be a major issue, as advertisers might end up cutting the budget on an effective display campaign that is driving additional conversions, brand awareness and increased visitor traffic to your web site.
If conversions aren’t enough, then what additional metrics should online advertisers be using to properly measure the success and value of search and display ads?
Enter the Assist metric available in Yahoo! Full Analytics, which is available to many of our advertisers meeting certain criteria (contact our Customer Solutions team to determine if it is available in your account). Assists measure the total number of times that display ads or search keywords contribute to the conversion of another ad or keyword. Combined with conversion data, the assist reporting provides a full picture as to the performance of online campaigns. And you might find out that the display ad you were planning to drop was actually helping you the whole time.
Accessing the Assist Report from Yahoo! Full Analytics is easy. Just follow these steps:
1. Check to see if you have Full Analytics available in your account.
2. Add the Full Analytics tracking scripts to your landing page(s) and confirmation/thank-you page.
3. Add three special Yahoo! tracking parameters to the end of your display ad destination URL.
Belief 2: Search ads provide the highest return-on-investment
Which provides the highest return-on-investment, search or display ads?
It’s a trick question, actually—a combination of search and display ads returns the highest return-on-investment. We’ve reported in the past that, “when combined, search and display advertising deliver profoundly better results than when used independently.” The study that we sponsored with ComScore showed “a significant lift in on-site engagement and an increase in online and offline purchasing by consumers who are exposed to integrated campaigns that employ both types of online advertising.”
Don’t believe us? Third-party studies have shown that “users exposed to both search and display ads convert at a higher rate: an average of 22 percent better than search alone, and 400 percent better than display only.”
If data from these studies is accurate, you might be asking yourself, “OK, why aren’t more marketers doing both?” Once again, advertisers haven’t been using the right metrics. Advertisers must have access to metrics that tie together their search and display efforts to see how one affects the other. By using the assist data from Yahoo! Analytics, an advertiser can accurately measure this information.
Here’s how: Let’s say a visitor comes across one of your display ads one day and decides to click on it. He visits your site but decides not to make a purchase. A month later, that same visitor searches on Yahoo! using one of your search keywords, clicks on your ad, visits your site again, and this time makes a purchase. The result? Your display ad receives credit for an assist, while your search ad receives credit for the conversion.
To summarize: If you want to ensure that you are making the right search and display budgeting decisions, you need to make sure that you are using the right metrics. With Yahoo’s Full Analytics Assist Report, you can discover the true value of your online advertising.
— Matt Lillig, Yahoo! Analytics Team