Lessons LearnedMaximizing Returns with Digital Media
About This Booklet FIVE Key Lessons LearnedWhile advertising has evolved tremendously with the advent 1 Clicks worst best an incomplete metricof new digital technologies, its goal today is much the same are atas it has always been—to elicit feelings, emotions, perceptions and at a misleading one.and actions that ultimately build brand loyalty and increasesales. Finding ways to do this in the most efficient manneris vital, and being able to quantify a return on marketinginvestment is a must. 2 Cookiein media planning, potential to create havoc deletion has the execution and campaign evaluation.As digital advertising continues to grow in both importance andsophistication, so does the need for guiding principles abouthow to get the most out of this medium. Through comScore’s 3 Digital campaigns have the ability to build brands and lift e-commerce and retailextensive research in the digital advertising space, we’ve sales, and as in traditional TV advertising,identified Five Key Lessons Learned, which help to shed light creative plays a critical role.on the current state of the industry and guide marketers downa path toward more effective planning, stronger evaluation andoverall improved results. 4 The ability of content to engage consumers can amplify the effect of an ad placed within the content. 5 media-placementfrom a variety is important When selecting strategies, it of to consider the relative costs and benefits of each.
A click means nothing. A click earnsno revenue and creates no brand equity. Your onlineadvertising has some goal, and it’s surely notto generate clicks. Regardless of whether they clickedan ad or not, the key is to determine how thatad unit influenced consumers to think, feel or dosomething they wouldn’t have done otherwise.John LowellSVP / Director, Research & AnalyticsStarcom USA 1. Clicks are at best an incomplete metric and at worst a misleading one
THERE ARE SEVERAL REASONS WHY‘THE CLICK’ IS NOT AN APPROPRIATE MEASURE This phenomenon of low click-through ratesOF ONLINE ADVERTISING EFFECTIVENESS is not observed in isolation. It’s something we see around the globe and in nearly every vertical industry.Perhaps most notably is the fact thatso few people actually click on any ads. Click-Through Rates* by Vertical Industry84% 0.06% 0.07% 0.08% 0.09% 0.10% 0.15% Financial Telecom Travel CPG/Retail/ Tech/Media/ Auto Services Wellness Entertainmentof all U.S. Internet usersdo not click on any adsin a given month Click-Through Rates** by Region 84% 0.05% Finland 0.07% Australia 0.07% UK 0.08% Sweden 0.09% Canada 0.10% USA non- CLICKERSAND There are 16%50% fewer CLICKERS 0.11% 0.12% 0.14% 0.17% 0.19% 0.30%clickers NOW Germany Switzerland Netherlands Greece Singapore Malaysiathan in July 2007. Source: DoubleClick for Advertisers, January to December 2009 *Click-through rates on individual ad campaigns by industry vertical for DoubleClick rich-media formats only; U.S. advertisers.Source: comScore Custom Analysis, March 2009 & July 2007 **Click-through rates across static image, flash & rich media formats; a cross-section of regions.
I spend a lot of time fighting againstmedia metrics that don’t matter.kate sirkinevp global research directorstarcom mediavest group 2. Cookie deletion has the potential to create havoc in media planning, execution and campaign evaluation
COOKIE-BASED MEASUREMENT AND COOKIES MEASURE COMPUTERS, NOT PEOPLETARGETING APPROACHES OFTEN RESULT IN Due to cookie-based targeting, it’s difficult to ensure theINACCURATE MEDIA PLANNING, execution correct person is actually being served an ad. Also, becauseAND CAMPAIGN EVALUATION the demographic data in cookies comes from a variety of sources – such as registration data, modeled demos based on content consumption and estimations by zip code – the qualityWhy is cookie-based measurement sub-optimal? of cookie data varies, meaning the results do too. For these reasons, campaign delivery often misses its target.HIGH COOKIE DELETION RATES In the below example, the advertiser’s target was women aged30% of all U.S. and 24% of all EU Internet users delete their 35-54 years old. However, post-campaign evaluation using thecookies in a month, and they do so an average of 4 to 6 times comScore panel showed the majority of exposed consumersa month. Deletion rates for 1st party (i.e. website) and 3rd party were outside of the target audience.(i.e. ad server) cookies are similar. Cookie deletion can result Percent Composition of Exposed Audiencein 2.5X overstatement in unique visitors to a website, and asimilar overstatement of reach and understatement of frequencyin ad campaigns. 20.6% (age 15-24) 22.4% (age 25-34) 40% 60% 25.3% (age 35-44) 17.3% (age 45-54) 14.4% (age 55+)A One-Week Snapshot cookie A cookie B cookie C 40% of exposed Only 43% of females exposed to the consumers were men campaign met the targeted age group DAY 1 DAY 7 A COOKIE CAN’T TELL THE DIFFERENCE Because of multiple users on a computer, you might intend to reach cookie cookie a 35-year-old woman with your ad when it is actually being served to her deleted deleted 45-year-old husband or 18-year-old daughter who is using her computer.The site reads THREE distinct cookies, which meansthis ONE visitor is counted THREE times. ? ?Source: comScore Custom Analysis, April 2010 Source: comScore Custom Analysis, April 2010
3.Digital campaigns have theability to build brands and lift e-commerce & retailsales, and as in traditional TV advertising, creative plays a critical role
DIGITAL ADVERTISING PROVIDES AN EFFICIENT for retailers, the lifT in retail sales MEANS OF BUILDING BRANDS and LIFTING can be upwards of 5X higher than the both E-COMMERCE AND RETAIL SALES lifT in e-commerce sales Retailer Dollar Sales Lift Among Households Exposed to Online Display Advertising Lift: Exposure to display ads doesn’t just impact 17% online sales—it lifts in-store sales as well. $11,550 $9,905 Lift: 27% Non-exposed $994 $1,263 Exposed Digital Advertising’s Impact on In-Store Sales* for CPG Brands Online Sales In-Store Sales Among Households Exposed to Online Display Advertising Source: comScore report, “How Online Advertising Works: Whither the Click” (published in the 2009 Journal of Advertising Research) 100% 80% For CPG brands, digital advertising can generate Average $ lift was 22% nearly the same in-store sales lift in a three-Percent lift in $ sales 60% 82% of campaigns month period as TV advertising does in one year. 40% showed a positive sales lift 20% Comparison of In-Store Sales Lift* for CPG Brands Resulting from Online Advertising vs. TV Advertising 0% No. of offline sales effectiveness studies -20% +8% +9% Source: comScore AdEffx Offline Sales Lift for Internet; IRI BehaviorScan® for TV, 2000-2009 Source: comScore-dunnhumby CPG Offline Sales Lift Studies, 2008-2009 *BehaviorScan® tests conducted over one-year period and reflect CPG ad campaigns’ typical *Advertising’s impact on retail sales is measured by linking the comScore panel of 1 million reach, while the comScore studies were conducted over a three-month period and reflect a 40% U.S. Internet users to their retailer loyalty card data from dunnhumby, which provides household Internet reach against target. It is possible that some wearout of the TV creative could a measure of the panelists’ in-store buying activity. have occurred during the one year of the TV campaigns.
Digital advertising has delivered Advertising on digital has become more sophisticated andon its promise of efficiency and production costs associated with rich media and video campaigns continue to rise, making the stakes higher than ever.effectiveness, but creative has beenlargely overlooked Now is the time for creative to take center stage in digital advertising.This shouldn’t be the case given that morethan half of the impact of advertising comesfrom the quality of creative. All advertising is a combination of art and science, logic and emotion, conviction and motivation. Until recently, digitalPercent Influence on Shifts in Brand Sales* advertising focused on the left brain area of science, logic and conviction. While these are important, it is clear that the next frontier is art, emotion and motivation, which come from that elusive butterfly creativity. I have always believed that the 52% Internet will usher in the next 48% creative generation of creativity. Creativity Media Plan Quality** that not only can we see, hear and & Weight, Price, Other feel, but also measure its impact. RISHAD TOBACCOWALA Chief Strategy & Innovation Officer VivaKiSource: comScore ARS Global Validation Summary*Numbers represent the percent variance in sales shifts explained by the corresponding factors.**Creative quality is based on the ARS Consumer Choice Score, which measures changes inconsumer brand preference through a simulated purchase exercise. A lift in the score is highlycorrelated with in-market sales lifts.
STRONG CREATIVE CAN INCREASE When these strategic elements are used inEFFECTIVENESS, BUT DIGITAL DISPLAY ADS DIGITAL CAMPAIGNS, they’ve demonstrated an ability to increase retail salesOFTEN DON’T INCLUDE THE ELEMENTS As in traditional TV advertising, digital campaigns thatNEEDED TO MAXIMIZE ADVERTISING’S IMPACT effectively leveraged these strategic elements generated the greatest offline sales lift.Key strategic elements, which have been Percent Lift in Retail Sales of CPG Brands Among Householdsproven to improve the quality of an ad’s creative Exposed to Online Display Advertisingand therefore its impact on sales, are used at amuch lower rate in digital ads than in TV ads. Elements present* Elements not present 80.0 75.0 75.9 75%Percent of Digital and TV Ads* Containing Key Strategic Elements Digital Display Ads Television 48.0 48.4 (Rich Media, Banners, 50% Rectangles) Ads Brand Differentiating Key Message 17% 31% 31.1 32.0 33.4 New Product /New Feature Information 19% 44% 25% 21.8 Product Convenience (explicit & stated) 0% 9% 6.0 7.3 Competitive Comparison 10% 24% 0.0 0% Superiority Claim 13% 26% -25% -20.6 Source: comScore ARS-dunnhumby Case Study of Major CPG Brands (Blinded, n=13), 2009-2010Source: comScore ARS Integrated Database *Key strategic elements included in this analysis were: Brand Differentiating Key Message,*Cases drawn from comScore ARS test databases and balanced by category (n=100 for New Product/New Feature Information, Product Convenience, Competitive Comparison anddigital display ads, n=3,681 for television ads); majority of cases involved CPG brands. Superiority Claim.
When it comes to digital advertising, The inclusion of price-RELATEDprice-related incentives are used INCENTIVES in online display adsmuch more frequently than in DRIVES offline salestraditional TV ads This begs the question:In many ways the Internet is being used todayin a manner more similar to newspapers and is online the new print?magazines than TV as it relates to the inclusionof price and promotion information in digital ads. Percent Lift in In-Store Sales for CPG Brands Among Households Exposed to Online Display Ads 60%Percent of Digital and TV Ads* Containing Value Elements Digital Display Ads Television (Rich Media, Banners, Rectangles) Ads 40% 48.9% Value (Economy/Savings) 22% 2% 39.5% Value (Special Offers, Coupons, etc.) 38% 2% 28.4% 20% 26.8% 0% No Value Coupon Free Explicit Value Information Only Samples ClaimSource: comScore ARS Integrated Database*Cases drawn from comScore ARS test databases and balanced by category (n=100 for Source: comScore ARS-dunnhumby Case Study of Major CPG Brands (Blinded, n=13),digital display ads, n=3,681 for television ads); majority of cases involved CPG brands. 2009-2010
As consumers spend more and moretime online, it’s critical for marketers to reachour consumers at the right time, with the rightmessage, communicated in the right way.Tools that help drive those insights help us stayon the cutting edge.GAYLE FUGUITTVice President Consumer InsightsGeneral Mills 4. The ability of content to engage consumers can amplify the effect of an ad placed within the content
Placing an ad within highly engaging There also appears to be a highcontent can help to maximize correlation between engagement & agethe ad’s impactWhat is engagement? Engaging content has a greater impact on older consumers.• Level of focus & attention• Loss of self-consciousness• Altered sense of time Comparison of ARS Consumer Choice Score* for Engaged• Intrinsic rewards vs. Unengaged Viewers by Age Segments• ImmersionA comScore ARS study involving online video found thatconsumers who were highly engaged with the video content 45% 33% Liftgenerated a stronger ARS Consumer Choice Score for thead placed within the content than unengaged viewers. Lift 13%This higher score is correlated with in-market sales lifts, Liftdemonstrating the ability of content to amplify an ad’s impact.Comparison of ARS Consumer Choice Score* for Engagedvs. Unengaged Video Viewers 95 107 88 117 83 120 Engaged Unengaged Percentage Viewers Viewers Lift Age 16-29 Age 30-49 Age 50+ ARS Consumer 118 87 36% Choice Score ARS Consumer Choice Score ARS Consumer Choice Score Engaged Viewers Unengaged ViewersSource: comScore ARS Custom Analysis, October 2010 Source: comScore ARS Custom Analysis, October 2010*ARS Consumer Choice Score measures changes in consumer brand preference through *ARS Consumer Choice Score measures changes in consumer brand preference througha simulated purchase exercise. A lift in the ARS Consumer Choice Score is highly correlated a simulated purchase exercise. A lift in the ARS Consumer Choice Score is highly correlatedwith in-market sales lifts. with in-market sales lifts.
5. When selecting froma variety of media-placementstrategies, it is important toconsider the relative costs and benefits of each
Not all targeting is created equal. Select Media-placement strategies Each has tradeoffs in terms of cost, reach and impact Audience Targeting: Targets consumers based on past interest or interaction with related products/content but who From audience targeting to contextual buys and from retargeting have not yet visited the advertiser’s site to efficiency or premium buys, there are many placement options that media planners must now consider. Because each Contextual Targeting: Targets sites with related, offers different pros and cons, it is important to select a media- page-level content placement strategy that best fits the specific campaign objective. Efficiency Pricing: Based on cost-per-click engagement with creative Likelihood to Search For Advertised Brand Post-Exposure 1800 Premium Pricing: Based on high-visibility placements 1600 The larger on premium publishers 1400 Premium the circle, the Pricing greater the Retargeting: Based on data that confirms users have 1200 Contextual reach. Targeting previously visited an advertiser’s site 1000Cost Index 800 Run-of-Network (RON): Includes ads that appear Efficiency Audience 600 Pricing Targeting Retargeting anywhere in the network, often optimized by conversion 400 Run-of-Network 200 When considering a media-placement strategy, the best option 0 often differs based on long-term versus short-term goals. 0 200 400 600 800 1000 1200 For example, some placements – like Efficiency, Pricing and Lift Index RON – optimize quickly to deliver traffic to a site (i.e. drive traffic within the first week), but they don’t always sustain these As shown in the above chart, Retargeting provides the highest audiences over time (i.e. traffic drops off after the first week). lift in search at an efficient cost, but it doesn’t deliver as high When it comes to longer-term effects, Audience, Contextual a reach as other strategies. Meanwhile, Run-of-Network and Premium strategies have been shown to work well, although placements provide a large reach at an efficient cost but garner Retargeting outperforms these three. relatively low lifts in search. Source: comScore report, “When Money Moves to Digital, Where Should it Go?”, September 2010 Source: comScore report, “When Money Moves to Digital, Where Should it Go?”, September 2010 Note: All campaigns in this study ran between July 2009 and March 2010 and were sold and delivered Note: All campaigns in this study ran between July 2009 and March 2010 and were sold and by ValueClick Media. delivered by ValueClick Media.