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E Marketer Online Brand Measurement Report


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  • 1. June 2009 Online Brand Measurement: Connecting the Dots Geoffrey Ramsey, CEO & Co-Founder Special Report Introduction More Available Online In 2009, US advertisers will spend $4.7 billion on We encourage you to view this special report online display ads, and another $3.1 billion on other at for branding-oriented ads, including rich media and access to videos, in-depth interviews and full video. But are they getting their money’s worth? survey results (courtesy of InsightExpress). On the Does online brand measurement even work? Do report Website, you can also join the conversation marketers have the metrics they need to connect on this important topic by contributing comments. the dots—both within online platforms and between online and offline media? Authored by eMarketer CEO and co-founder Geoff Ramsey, this special report addresses these questions and many more. A Look Inside Total Access: This report gives you a sample of the premium content that is exclusive to eMarketer Total Access subscribers. For more information on what Total Access can do for your business, day after day, visit, or contact us at 212-763-6010 or 800-405-0844 (toll-free). ® Digital Intelligence Copyright ©2009 eMarketer, Inc. All rights reserved.
  • 2. Geoff Ramsey: Why This Report? Measurement means different things to different This report was made possible by contributions from many individuals, who offered their time, expertise and razor-sharp people—but most can agree that in business, thinking on an incredibly complicated topic, including many of my measurement is vital to long-term success. hard-working colleagues at eMarketer. In particular, I want to thank senior analyst David Hallerman, who shored up my original draft I’ll never forget my first experience with measurement. When I with much-needed improvements; writer/editor Tobi Elkin, who was 12 years old, my family moved to the UK, exposing me to a conducted more than two dozen high-level interviews; and Evelyn new school system and a decidedly different way of measuring Majewski, who analyzed and provided a contextual summary of student performance. Instead of the generalized feedback I was the InsightExpress poll of industry professionals. used to in Michigan, such as “needs to try harder,” the UK students I am also grateful for the commitment and friendship of the were ranked from 1 through n (where n = however-many- industry leaders who agreed to be interviewed or come into students-were-in-the-class). Granted, it was a blunt measure. And our offices for video sessions. I offer special thanks to David at the end of the first marking period, I was ranked last in every Smith of Mediasmith, a legend in online measurement, who single subject, from Latin to mathematics. Ouch. acted as a sounding board and sanity check for many of my Remarkably, though, this measurement system had a profound points and conclusions. effect on me. I started paying attention in class and generally The process of writing this report was like absorbing the worked like a dog. By the end of the last marking period, my rank collective consciousness of the online ad industry, and it had elevated to No. 1 or No. 2 in each class. convinced me to change my views on a number of key issues. I Could the online advertising industry benefit from a similar hope it opens your mind to some new ideas and provides a forum transformation if better brand measurement systems were put in for the industry to move forward on this important subject of place? Does the industry have the right metrics to be able to online brand measurement. connect the dots—both within online platforms and between online Please take the time to share your comments and thoughts. and offline media? That’s what this report was designed to uncover. Collectively, we can begin to connect the dots—and maybe we Online brand measurement has been on my mind for some time can move to an 8 or 9 out of 10 sooner rather than later. now. After moderating industry panels with session titles such as Geoffrey Ramsey “Fixing the Measurement Mess” or “Is Data Friend or Enemy?” it CEO, Co-Founder, eMarketer became clear that we had some major challenges to overcome. That feeling was confirmed when eMarketer commissioned InsightExpress to conduct a poll of industry stakeholders. On a scale of 1 (we’re still in the Dark Ages) to 10 (we’ve got this all figured out), a majority (51%) rated the current state of online brand measurement at 5 or below. Ouch again. ® Online Brand Measurement: Special Report 2
  • 3. Letter from Our Sponsor, Datran Media When I first heard that eMarketer was publishing Unfortunately the industry is still stuck in a rut over counting methodologies. Yet at the end of the day, the only figures that a study dedicated to online measurement, I got typically matter come from an advertiser’s third party ad server, as excited, because I felt that the timing couldn’t this is what determines the money actually spent on advertising. be any better. Until the debate switches from unique user counting to the accuracy and quality of data about the individuals exposed to and We are witnessing a very interesting period in the industry where interacting with the ad campaign, we will be holding back the advertisers are no longer simply buying media on Web sites to potential of the industry. Not to say that the number of monthly reach a particular audience, but instead are actually targeting visitors isn’t at all relevant to publishers or advertisers, but let’s put users. The explosion of exchanges and behavioral data targeting that challenge into perspective and focus resources on moving has suddenly made the term “remnant” important and sexy. Let’s the market forward with the type of audience measurement that face it, this is not a just a trend, but rather a clear movement today’s marketer truly needs. towards leveraging the plethora of data that differentiates the I trust that this timely report will give us all a lot of food for thought Internet from any other form of media. Even when advertisers buy and we are delighted to be sponsoring it. No one knows exactly from an individual site, they are now expecting to target specific what measurement will consist of in five years, but I guarantee it users with relevant demographics or behavior. Although this will evolve greatly from what exists today. This study should appears to be a subtle switch, it actually has a profound effect on provide us with not only the current challenges, but also a hint of the industry, especially when it comes to measurement. Think things to come. Enjoy the report and let the debates begin! about it. The measurement tools that exist on the Web today were created to address the desire to determine the most popular sites Sincerely, by attempting to count the number of unique visits to individual Scott C. Knoll sites on a monthly basis. These tools were not really developed to SVP Display and GM Aperture Product Group, Datran Media provide valid insights into the user behind the browser. Perhaps in the early days of the Internet when people were focused on buying homepages or sponsorships, knowing the most popular sports-related Web site was actually relevant. But let me ask you a question, if you are only buying four million unique impressions, does it really matter whether the site reaches 20 or 30 million visitors a month? Although instinctively most of us want to say yes, chances are the answer is no. Advertisers should be shifting from asking what site is the most popular to wondering “who specifically am I reaching?”, “is this who I am intending to reach?” and “what is the impact on my brand?” ® Online Brand Measurement: Special Report 3
  • 4. ADVERTISEMENT Verified consumer data is the key to accurate reporting What are Analytics Really Current methodologies are outdated Telling You about Your Audience Most research sample sizes are statistically insignificant Audiences need to be measured at the campaign and creative level, not just site level Advertisers and marketers have long searched, with mixed results, for proof that their campaigns are e ective. For the interactive industry, integrity in audience measurement is a fundamental necessity. After all, accurate reporting and transpar- ency is critical when planning future media buys, segmenting audiences, and optimizing marketing mixes. 19,312,785 41,228 2, impressions clicks conv How crucial do you feel analytics can be in dictating future ad campaigns? (% of respondents) INFLUENCE (share of impressions) DEMOGRAPHICS FINANCE HOUS College Grad $250k (Net Worth) 1-2 36-45 yrs (Adult Age) Bank Card 1 Females 35-44 yrs $100k (Income) Very 69.2% Males 35-44 yrs pressions indexed to internet Somewhat 30% Not at All .8% Source: Datran Media, “Third Annual Marketing & Media Survey,” January 2009 Adult Age (all) Sampling Percent 62% The methodologies that most media is measured by today are 86-99 yrs over 70 years old! Panel-based research was initially developed to 76-85 yrs help radio advertisers understand how many listeners were 66-75 yrs exposed to their campaign. Ironically, not much has changed in the world of media measurement. Although in recent years, 56-65 yrs ISP-based measurement has made some attempts to improve the 46-55 yrs way audiences are quanti ed. 36-45 yrs Clearly, online advertisers need deeper insights into who they're Aperture measures 26-35 yrs reaching. In today’s competitive atmosphere, where targeting household- level 18-25 yrs very speci c audiences is increasingly important, the old-world demographics across the entire 0 2 4 6 8 10 12 14 16 18 20 media chain – from impressions methodologies are becoming less relevant. to clicks to conversions. Do you currently leverage audience analytics? (% of respondents) Aperture answers the questions every digital marketer is asking: Yes 76% Am I reaching the right audience? No 26% Who is responding to my campaign? Source: Datran Media, “Third Annual Marketing & Media Survey,” January 2009 Should I be targeting new audiences? To understand who your audience truly is, you need a reporting tool With more and more marketers relying on analytics to shape their that is designed for the 21st century digital marketer. To learn more campaigns, new tools are being developed for today’s online about Aperture, please visit advertiser, as evidenced by the recent launch of Datran Media’s Aperture. Aperture is the rst and only audience reporting tool that delivers consumer pro les across all digital media, based on third-party veri ed household-level data. Anonymously combining veri ed o ine data with the online activity of over 100 million consumers, this rich data provides unprecedented insights into the audience that is exposed to, has responded to, and is converting on an advertiser’s campaign. A Datran Media Solution
  • 5. Table of Contents Introduction 1 Building New Measurement Models for Social and Video Environments 44 More Available Online 1 Unraveling Consumer Engagement Metrics 46 Geoff Ramsey: Why This Report? 2 Next Steps: A Seven-Point Plan 47 Letter from Our Sponsor, Datran Media 3 Endnotes 49 Table of Contents 5 Related Information and Links 52 Background: Factors that Contribute to the Contact 55 Measurement Issue 5 Report Contributors 55 What Does ‘Measurement’ Mean? 5 eMarketer Total Access: How to Make Better Putting Measurement into Perspective 6 Digital Business Decisions 55 The Accountability Factor 7 What Spending Trends Say About Online Brand Measurement 10 Total Online Spending—Slow but Positive Growth Ahead 10 Search versus Display Trends 11 Dollar Trends Don’t Tell the Whole Story 14 Beyond Banners: Other Online Formats Will Boost Overall Branding Dollars 15 Drill Down: What Are the Problems? 16 A General Apathy Toward Branding 16 A Preoccupation with Search, at the Expense of Branding 18 An Addiction to Clicks 21 Do Traditional Measurement Techniques Work for New Media? 22 Integration Is Hard When Data Is Locked in Silos 23 Too Much Information, Too Much Complexity 24 Current Measurement Models Have Limitations 25 Measurement of Social and Video Are Even Further Behind 26 Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel 27 How Display Ads Impact Brand Metrics 28 Integrating Search and Display Ad Measurements 29 How Display Ads Drive Site Traffic 30 How Display Ads Impact Online Sales 30 How Display Ads Influence Offline Purchases 31 Three Factors for Online Branding Success 33 Working Toward the Solutions for Online Brand Measurement 35 Big Picture: Five Broad Approaches 35 It All Starts with Marketing Objectives 36 The Need for Uniform Standards 36 Integrate Online and Offline Measurement and Metrics 39 Embrace Traditional Media Metrics 39 Get Smart About Attribution Modeling 42 ® Online Brand Measurement: Special Report 5
  • 6. Background: Factors that Contribute to the Measurement Issue Putting Measurement into Perspective In April 2009, eMarketer used online survey company US advertisers will spend $4.7 billion on display InsightExpress to poll 37 high-level, highly knowledgeable marketing professionals with expertise in the field of media ads in 2009, and another $3.1 billion on other measurement. The purpose was to gauge their opinions on the branding-oriented ads, including rich media and state of online brand measurement. video. But are they getting their money’s worth? To get a level set on the degree to which measurement is seen Do they have the right metrics, and are they able as a significant barrier to the growth of online advertising, the respondents were asked whether they agreed with the to connect the dots, both within online platforms following statement: and between online and offline media? Is online “Other than the economy, brand measurement is the brand measurement even a problem that needs single biggest obstacle holding back the growth of to be fixed? online advertising.” A little under one-half of respondents, or 43.2%, agreed that This special report will seek answers to these questions, and measurement is the major obstacle aside from the overall economy. many more. US Marketing Executives Who Agree that Brand Measurement Is Holding Back the Growth of Online “It’s time for digital media to grow up and for Advertising, April 2009 (% of respondents) clients who are running full-on marketing campaigns to really understand how their Disagree campaigns are performing if they spend $5 56.8% million or $1 million or $800,000 online, across various sites and fragmented Agree audiences.” —Curt Hecht, president, Publicis Groupe’s 43.2% VivaKi Nerve Center, in an interview with eMarketer, April 22, 2009 Note: n=37 Source: eMarketer, "Online Brand Measurement Survey" conducted by What Does ‘Measurement’ Mean? InsightExpress, June 2009 104486 In exploring online brand measurement today, marketers need to 104486 be careful to separate out its two basic components: But while 56.8% of respondents disagreed with the statement, ■ How successfully and efficiently did I reach my intended their answers for alternative obstacles varied. In general, they target consumer? centered around three broad themes. But as this report makes clear, each of these obstacles is, in fact, an integral part of the core ■ Did my advertising campaign influence the consumer’s measurement problem. Taken together, they pinpoint the key attitudes, perceptions or behaviors associated with the brand? challenges facing the industry. The following quotations provide “One question is about ad effectiveness, and the other is the some elaboration. currency that is bought and sold,” said Young-Bean Song, senior director of analytics and the Atlas Institute for Microsoft Obstacle: Too much focus on direct response Advertising, in an interview with eMarketer. “In an ideal world, ■ “Overinfluence of direct response metrics. Perhaps these are those would be the same thing. That’s one of the good things two sides of the same coin but still, today, there is a large about direct response advertising, where you’re paying somebody school of thought that direct response is the basic benefit of for a sale that occurs on their network or you’re paying for a click. online advertising.” Both the currency and the measure of effectiveness are the same ■ “A myopic focus on direct response ads and immediate thing. But in the world of branding, things get a lot more abstract. You still have to pay for something, but you’re not going to pay for gratification.” branding ad effectiveness.” ® Online Brand Measurement: Special Report 6
  • 7. Background: Factors that Contribute to the Measurement Issue Obstacle: Lack of creativity If there is any solace, it’s in the slight improvement over the years. ■ “A lack of CMO and marketing creative focus on online efforts, When asked how they would have rated online measurement five and true measurement of buying influences.” years ago, a whopping 78% of respondents said they would have rated it a 4 or lower, with nearly one-third (29.7%) rating it a ■ “Brand measurement is certainly one area that needs to pathetic 2. improve, but also improved creative and CMOs’ understanding of the platform are also a priority.” US Marketing Executives' Ratings* of the State of Online Advertising Measurement Five Years Ago, April 2009 (% of respondents) Obstacle: Lack of understanding about how 10 0.0% digital works 9 0.0% ■ “Understanding how online fits in with other media.” 8 0.0% ■ “Vision, imagination, ideas, experience. We are still in an early 7 0.0% stage of adoption for many companies, where many marketers 6 8.1% just don’t have the bandwidth or experience to make digital work, let alone sync with the rest of their marketing programs.” 5 13.5% 4 24.3% ■ “The problem is subjective, not quantitative: It is about 3 18.9% experience with the medium and belief in its virtues.” 2 29.7% To further quantify where the online ad industry is with 1 5.4% measurement today, the InsightExpress poll also asked respondents to rate the measurement issue on a continuum from Note: n=37; numbers may not add up to 100% due to rounding; *on a scale of 1-10, where 1="We are in the Dark Ages" and 10="We've got this thing 1 to 10, where 1 is “We are in the Dark Ages,” and 10 is “We’ve got totally figured out" Source: eMarketer, "Online Brand Measurement Survey" conducted by this thing totally figured out.” Not a single one of the 37 InsightExpress, June 2009 respondents rated online ad measurement a 9 or 10. Only 16.2% 104492 of respondents rated measurement a 7 or higher, and just under 104492 one-half rated it at least a 6. Looking to the future, respondents gave the industry an average of three to five years before online measurement would attain a The bottom line: A slight majority (51.3%) believed online score of 8 or above. measurement is at a grade of 5 or below. Clearly, the interactive ad industry has a problem on its hands. In One Word, Describe Online Measurement US Marketing Executives' Ratings* of the State of Today Online Advertising Measurement, April 2009 (% of respondents) In the informal poll eMarketer conducted among industry 10 0.0% insiders, we asked them, “What single word or phrase would you use to describe the current state of online 9 0.0% advertising measurement?” The answers were telling— 8 2.7% strongly reinforcing the idea that the online ad industry 7 13.5% has a long road ahead. 6 32.4% 5 18.9% 4 13.5% 3 16.2% 2 2.7% 1 0.0% Note: n=37; numbers may not add up to 100% due to rounding; *on a scale of 1-10, where 1="We are in the Dark Ages" and 10="We've got this thing totally figured out" Source: eMarketer, "Online Brand Measurement Survey" conducted by InsightExpress, June 2009 104488 104488 ® Online Brand Measurement: Special Report 7
  • 8. Background: Factors that Contribute to the Measurement Issue The Accountability Factor A study by Heidrick & Struggles of 111 US senior executives found Even before the recession, marketers were under tremendous that return on marketing investment was the highest-ranked pressure to better account for their advertising outlays. The marketing tactic in terms of importance to the company’s growth downturn only reinforced and accelerated the need to set specific objectives, rating a 4.05 on a scale of 1 to 5. Notably, online display marketing goals and carefully measure results from ad campaigns. ads were way down on the priority list, rating a paltry 2.86 out of 5. Executives’ satisfaction with online display ads was similarly poor, “Marketers have been challenged to be more accountable by at 3.07. However, satisfaction levels with social networking tools CEOs who are looking for shareholder return and value,” said Bob (2.75) and video ads (2.65) were far worse. Liodice, the president and CEO of the Association of National Advertisers, in an interview with eMarketer. “The challenge for Satisfaction Level of US* Senior Executives Regarding marketing is: ‘Prove to me that marketing works. Prove to me that Their Company's Effectiveness at Developing Select Marketing Tactics, November-December 2008 (scale of 1-5**) no matter how you slice it, the investments are paying back in Publishing tools–Webinars both short- and long-term deliverables.’” 3.96 Many studies underscore the accountability mandate for Research and analysis–online surveys 3.25 marketing, including a 2009 survey by the Lenskold Group and Research and analysis–Website activity analysis MarketSphere in which 65% of marketers worldwide said that 3.14 CEOs and CFOs are demanding to see ROI as a part of securing Promotions–contests/sweepstakes budgets for marketing initiatives. Seventy-nine percent of the 3.11 marketers felt that the need to measure, analyze and report Publishing tools–e-mail newsletters 3.11 marketing effectiveness was greater in 2009 than in previous years. Websites/applications–microsites Another 2009 survey, from JupiterResearch and Verse Group, found 3.07 that achieving measurable ROI on marketing efforts was the No. 1 Advertising–online display ads 3.07 priority of US marketers for 2009. Second on their list was developing Research and analysis–return on marketing investment (ROMI) marketing programs that integrate online and traditional media. analysis 3.07 Leading Priorities for US Marketers in 2009 (% of SEO–pay-per-click search ads respondents) 3.05 Achieving measurable ROI on my marketing efforts Collaboration and process tools–project management/marketing 50% process tools 3.00 Developing marketing programs that integrate online and traditional media SEO 43% 3.00 SEO–search-related landing pages Translating the brand experience across different touchpoints 2.96 32% Promotions–gaming Cutting marketing budgets without cutting performance 2.96 31% Partner tools–supplier/customer intranets Optimizing our portfolio of brands 2.93 26% Publishing tools–blogs 2.75 Selecting better methods to uncover relevant consumer insights Websites/applications–social networking tools 23% 2.75 Measuring brand effectiveness Websites/applications–e-commerce sites 20% 2.69 Refreshing our brand's image Collaboration and process tools–customer relationship 19% management (CRM) (sales process) 2.68 Evolving our brand as the company's business strategy evolves Advertising–video ads (e.g., on YouTube) 18% 2.65 Building a corporate culture rooted in our brand Advertising–mobile ads 17% 2.58 Note: n=101 Note: n=111; *90% of respondents are US-based; **1=not satisfied and Source: JupiterResearch and Verse Group, "CMO Priorities for 2009," 5=very satisfied February 2009 Source: Heidrick & Struggles, "The Digital Marketing Standard," provided to 102141 eMarketer, April 20, 2009 emarketer_2000584_102141 103679 emarketer_2000584_103679 ® Online Brand Measurement: Special Report 8
  • 9. Background: Factors that Contribute to the Measurement Issue Again, the growing pull toward more accountability in marketing is “I think if we came to an agreement on how a only reinforced by the severe economic climate. In the CMO Council’s brand campaign influences a direct annual “Marketing Outlook 2009” report among 650 marketing response campaign and understood how professionals worldwide, fully one-half said they were cutting their display advertising impacts search, that marketing budgets this year.As Liz Miller,VP of programs and would be a game-changer. It would change operations at the CMO Council, said in the April 6, 2009, issue of BtoB the way our clients buy online media.” magazine,“Everything we have seen and possibly predicted was that —Jeff Lanctot, chief strategy officer, Razorfish, in an a typical knee-jerk reaction to the recession would happen—budgets would be slashed across the board and companies would look at interview with eMarketer, April 28, 2009 marketing as if it were a line item that must be removed immediately.” “This recession is having a dislocation When marketers in the CMO Council survey were asked which impact. It is causing advertisers to look media elements would see their budgets increased by more than more closely at the Internet because of the 5%, 33% of respondents cited interactive/Web, 25% indicated cost savings they might have [versus] if search marketing and 23% named social media. everything economically was fine. [The Internet’s] growth is slowing, [but] it’s “There is an increase in those programs and gaining share.” —Gian Fulgoni, chairman and co- media options that will have an ROI that can founder, comScore, in an interview with eMarketer, April be measured and provide direct engagement 15, 2009 with customers.” —Liz Miller,VP of programs and operations, CMO Council, in BtoB magazine,April 6, 2009 Consulting firm McKinsey & Co. conducted a study in June 2008 and found that only 20% of marketing executives worldwide claimed to use quantitative analytical techniques to optimize their online Where Is Digital on the Accountability Front? marketing efforts. Most used subjective—or gut—measures. The marketing accountability mandate extends to every form of media, including the Internet. But while the Web, in general, is In a more recent November 2008 survey by integrated marketing perceived as highly accountable, the actual usage and success of solutions provider Alterian, 47% of the 1,545 marketers and measurement programs depends heavily on marketers’ objectives. agencies polled said they used analytics to measure their online campaigns. Despite the obvious vested interest here, the Alterian Most marketers have a handle on measuring and calculating ROI survey suggests a positive trend for marketer adoption of analytics. for their search campaigns, which tend to be focused on short- term, direct response results. Far fewer have mastered the art More evidence that progress is being made for measuring the ROI (and science) of assessing the impact of their branding efforts, of online advertising comes from a series of surveys among which tend to have a longer-term focus and are much harder and marketers conducted by PROMO magazine between 2007 and more complex to measure. 2009. In 2009, the Internet was deemed more profitable on an ROI basis than traditional media by 34% of respondents—up from But the industry is gradually waking up to the fact that marketers and 21.6% in 2008 and 25.9% in 2007; only 7.4% felt the Internet was their agencies have been overemphasizing search while less profitable than traditional media in 2009. simultaneously devaluing their online branding efforts—largely because of inadequate measurement tools and platforms. In the aggregate, branding-oriented ads today account for slightly less than one-third (31.5%) of total online advertising dollars spent in the US. ® Online Brand Measurement: Special Report 9
  • 10. Background: Factors that Contribute to the Measurement Issue What Spending Trends Say About Online Brand Measurement Interactive vs. Traditional Marketing ROI According to US Marketers, 2007-2009 (% of respondents) Spending trends by advertisers tell another side More profitable of the story about the state of online branding 25.9% 21.6% and its measurement. 34.0% Equally profitable Total Online Spending—Slow but Positive 16.0% Growth Ahead 11.5% Like in every other media category, growth in online advertising 13.9% spending is slowing. However, while traditional media—television, Less profitable radio, magazines and (especially) newspapers—are experiencing 8.4% cataclysmic, double-digit declines, Internet spending is slowing 4.7% 7.4% from a growth rate of more than 25% to about 4.5%. In fact, eMarketer sees online spending growth remaining positive Do not measure throughout the duration of this recession. By year-end 2009, online 14.4% 10.1% ad spending will be just under the $25 billion mark. 9.0% US Online Advertising Spending Growth, 2007-2013 (% Do not know change) 27.8% 39.2% 2007 25.6% 28.7% 2008 10.6% Does not apply 2009 4.5% 7.6% 2010 9.4% 10.1% 7.0% 2011 10.8% 2012 13.5% 2007 2008 2009 Note: numbers may not add up to 100% due to rounding 2013 10.4% Source: PROMO magazine, "2009 Promo Interactive Marketing Survey" conducted by Penton Research, April 1, 2009 Source: eMarketer, April 2009 103776 102197 102197 103776 Looking specifically at the data analytics side, Forrester Research For additional information on the above chart, see Endnote reported in May 2009 that over the next five years, US companies 102197 | 104363 | 104366 in the Endnotes section. will more than double their aggregate spending on Web analytics, including data analysis of advertising campaign performance. The eMarketer’s projection of 4.5% growth for US online advertising in research firm sees such spending growing from $421 million in 2009 is supported by a wide variety of independent sources, from 2009 to $953 million by 2014. media and research firms to investment banks. Although a few sources point to marginal declines, most predict online ad “It’s sort of a chicken or egg problem in that spending growth will remain positive. measurement is expensive so it’s prudent to measure only big campaigns on major initiatives. So until more money’s spent online for branding, the measurement’s going to lag. If the measurement and metrics lag, how can we expect the offline dollars to pour in?” —Jeff Lanctot, chief strategy officer, Razorfish, in an interview with eMarketer, April 28, 2009 ® Online Brand Measurement: Special Report 10
  • 11. What Spending Trends Say About Online Brand Measurement As an early indicator of how these full-year 2009 projections are Comparative Estimates: US Online Advertising Spending Growth, 2009 (% change*) playing out, the IAB reported in June that online ad spending was LiveRail, September 2008 down by 5% in Q1. eMarketer benchmarks its future projections 19.4% on IAB reports, which are conducted by accounting firm JupiterResearch, December 2008 PricewaterhouseCoopers (PwC). Notably, eMarketer predicts a 14.8% slight uptick in online ad spending growth during the second half BMO Capital Markets, October 2008 of 2009. 13.0% Surveys among marketers—the ones spending the money— Wachovia, October 2008 confirm this online growth trend. In an Advertiser Perceptions 10.0% study among 1,599 advertisers and agencies, conducted in April ZenithOptimedia, April 2009 2009, just over one-half (51%) said they were increasing their 7.4% online budgets over the next six months. While that is positive, it is Borrell Associates Inc., November 2008 down from 72% just one year ago. 7.2% SNL Kagan, May 2009 Particularly in this harsh economic environment, any increases in 6.2% online advertising spending will likely come at the expense of Collins Stewart LLC, May 2009 traditional media budgets. In a worldwide study by McKinsey in 5.0% June 2008, a majority of marketers (55%) said they were cutting GroupM, March 2009 their traditional media budgets precisely in order to fund more 5.0% digital efforts. Several even more recent surveys corroborate this eMarketer, April 2009 migration from traditional to digital. 4.5% Citi Investment Research, January 2009 But not all ad formats in the online sector are trending in the same 4.3% direction. Spending on display ads, which usually serve a ThinkPanmure LLC, October 2008 marketer’s longer-term branding objectives, is headed downward. 3.0% Conversely, spending on search, which is usually considered a Barclays Capital, May 2009 direct response vehicle designed to achieve immediate results, is 2.3% holding steady. Morgan Stanley, March 2009 2.1% Search versus Display Trends Thomas Weisel Partners, March 2009 By year-end 2008, search had grown to account for fully 45% of all 1.5% online advertising spending in the US. The current economic Jefferies & Company, February 2009 climate will only accelerate this trend, with the result that 1.0% marketers will spend nearly 49% of their online budgets on Credit Suisse, February 2009 search—primarily for its direct response capabilities. Static display 0.1% advertising, on the other hand, will see its share slip from 20.8% of Myers Publishing LLC, May 2009 online ad dollars in 2008 to 19% this year. -0.5% Oppenheimer & Co. Inc., February 2009 US Online Display and Search Advertising Spending -2.0% Share, 2008-2013 (% of total) 2008 2009 2010 2011 2012 2013 UBS, February 2009 -5.0% Search* 45.0% 48.8% 50.5% 50.4% 49.4% 49.3% Display ads** 20.8% 19.0% 18.0% 17.0% 16.1% 14.9% Cowen and Co., May 2009 Note: *paid listings, contextual text links and paid inclusion; **banner ads -6.0% only, excludes rich media and video Source: eMarketer, April 2009 Note: *vs. prior year Source: eMarketer, April 2009; various, as noted, 2008 & 2009 104600 104394 104600 104394 For additional information on the above chart, see For additional information on the above chart, see Endnote 104597 | 104600 in the Endnotes section. Endnote 104394 in the Endnotes section. ® Online Brand Measurement: Special Report 11
  • 12. What Spending Trends Say About Online Brand Measurement In terms of dollars spent, search advertising will grow 13.4% in More Evidence that Display Ad Spending Will Shrink 2009, while display ads will shrink by 4.6%. eMarketer is not alone in thinking 2009 will see search budgets continue to ascend while spending growth on display ads US Online Display and Search Advertising Spending goes negative. Growth, 2008-2013 (% change) 2008 2009 2010 2011 2012 2013 In the comparative estimates chart below, every single research Search* 19.8% 13.4% 13.2% 10.6% 11.2% 10.2% firm, investment bank and media house predicts a positive trend Display ads** 9.4% -4.6% 3.6% 4.4% 7.8% 2.2% for search ad dollars this year, with a range of 1% growth (Cowen Note: *paid listings, contextual text links and paid inclusion; **banner ads and Co., Myers Publishing) to 21% (BMO Capital Markets). On the only, excludes rich media and video Source: eMarketer, April 2009 other hand, there is a consensus that display spending will see 104597 negative growth. Investment bank Oppenheimer & Co. is the 104597 most pessimistic, projecting display ad spending will tumble 15% For additional information on the above chart, see this year. Endnote 104597 | 104600 in the Endnotes section. Comparative Estimates: US Online Display and Search Advertising Spending Growth, 2009 (% change*) After the downward blip in 2009, display ad spending growth will Online Search display enter positive territory again in 2010, but at a rate of only 3.6%, Barclays Capital, May 2009 -1.0% 10.0% while search will climb 13.2%. BMO Capital Markets, October 2008 -2.0% 21.0% Over the next several years, display ads as a percent of total Citi Investment Research, November 2008 -5.0% 14.0% online advertising will shrink from 19% in 2009 to just below 15% Collins Stewart, November 2008 3.0% 13.0% in 2013. Other researchers and analyst firms forecast a similar Cowen and Company, May 2009 - 1.0% downward trend. Credit Suisse, January 2009 -5.9% 8.1% eMarketer, April 2009 -4.6% 13.4% Forrester Research, April 2009 1.7% 13.9% JPMorgan, January 2009 6.3% 9.9% Myers Publishing LLC, May 2009 -3.0% 1.0% Oppenheimer & Co., February 2009 -15.0% 10.0% SNL Kagan, May 2009 4.6% 9.1% ThinkPanmure, October 2008 -5.0% 13.0% ZenithOptimedia, April 2009 -1.8% 9.0% Note: *vs. prior year Source: eMarketer, April 2009; various, as noted, 2008 & 2009 104573 104573 For additional information on the above chart, see Endnote 104573 in the Endnotes section. “It’s time we woke up and faced reality. Online display-ad spending will fall in 2009, probably sharply.” —Henry Blodget, CEO, Silicon Alley Insider, October 20, 2008 Quarterly reports offered by Nielsen and TNS provide an early look at how these display spending projections are coming along. For Q1 2009, however, the sources provide opposite views: Nielsen Co. says display ad spending was down 3.5%, while TNS Media Intelligence reports it was up 8.2%. ® Online Brand Measurement: Special Report 12
  • 13. What Spending Trends Say About Online Brand Measurement The reason for the disparity is that each firm is measuring a It is also instructive to look at how marketers are using display ads. different thing. Specifically, Nielsen, which reported a 3.5% drop in According to AdRelevance, which measures impressions by display ad spending, only counts CPM-based display spending. objective, advertisers have been slightly increasing their use of TNS Media Intelligence, on the other hand, which reported an 8.2% display ads as a means to achieve direct response objectives, with increase, includes both CPM and cost-per-action/cost-per-click 73% of impressions focused on direct response in Q4 2008. At the deals. We can conclude two things from this data: beginning of 2008, only 68% of display impressions were direct- response-focused. 1. Online display ad spending continues to increase. 2. Advertisers are shifting from CPM deals to pay-for-performance. Surveys of marketers and ad agencies tell the same negative story. For example, in a January 2009 AdMedia Partners survey of marketers worldwide, 76% expected to increase their search spending in 2009, with only 7% planning a decrease. In contrast, only 26% saw increases for display advertising, while 45% were predicting a decline. Change in Online Marketing Spending in 2009 According to Senior Marketing Executives Worldwide (% of respondents) Increase Flat Decrease Word-of-mouth/social media marketing 77% 12% 11% Search marketing 76% 18% 7% Mobile marketing 75% 14% 11% Behavioral/contextual marketing 70% 22% 7% Lead generation 63% 29% 9% CRM/analytics 60% 31% 9% Video advertising 60% 24% 16% E-mail marketing 58% 31% 11% Online gaming/in-game advertising 51% 30% 18% Online media buying/planning 47% 40% 13% Affiliate marketing 46% 35% 19% Web development 39% 38% 23% 104214 Market research 27% 50% 23% Display advertising 26% 29% 45% “So much of the investment that has been Note: numbers may not add up to 100% due to rounding Source: Ad Media Partners, "2009 Merger and Acquisition Prospects for made online has been very much tied to Advertising, Marketing Services and Interactive Firms," January 28, 2009 direct marketing campaigns. The dollar 101734 emarketer_2000584_101734 investment made in search alone is One upside indicator on display ads comes from the world’s representative of that.” —Pam Horan, president, largest spender on advertising, Procter & Gamble. According to Online Publishers Association (OPA), in an interview with the June 8, 2009, issue of Advertising Age, P&G decreased its eMarketer, April 27, 2009 measured media spending by 18% in Q1 2009 but more than doubled its spending on online display ads, as measured by TNS. Similarly, P&G’s rival Johnson & Johnson nearly doubled its spending on Internet display ads in the same quarter. Both increases, though, were from very small bases. Online Brand Measurement: Special Report 13
  • 14. What Spending Trends Say About Online Brand Measurement Dollar Trends Don’t Tell the Whole Story “Ad networks have driven CPMs down to a Just because the analysts predict negative growth for online terrible level.” —David Verklin, CEO, Canoe Ventures, display advertising and most advertisers give it short shrift in their as quoted in MediaPost’s OnlineMediaDaily, April 29, 2009 marketing efforts does not mean that display ads necessarily deserve the bad rep. At $2.46 in 2008, average online CPMs were less expensive than every form of traditional media, with the exception of outdoor, In fact, a pullback or complete retrenchment from display according to Jefferies & Co. advertising could end up being a big mistake for marketers. US Advertising CPM, by Media, 2008 There are four interrelated factors impeding the growth of online display ad spending: Broadcast TV $10.25 Syndication TV $8.77 ■ A depressed economy, along with severely reduced media budgets overall Magazines $6.98 Cable TV $5.99 ■ Intense pressure on pricing for display units, which, in turn, is a Newspapers $5.50 function of both the economy and the proliferation of ad networks (more than 400 at last count), which tend to Radio $4.54 commoditize pricing Outdoor $2.26 ■ A lack of adequate measurement systems to justify the use of Source: Jefferies & Company, Media Dynamics, InterMedia Dimensions and company reports, "Snapshot of the Global Media Landscape," provided to display ads eMarketer, February 2009 103170 ■ A tendency for marketers, in the context of draconian budget 103170 cutbacks, to focus their marketing efforts on below-the-line, direct response initiatives “Two elements working in online display The last factor represents a familiar pattern for marketers. As advertising’s favor are that its tracking Randall Rothenberg, CEO of the IAB, said on his clog (a cross capabilities have been improved and its between a blog and a column): “It’s an axiom of marketing that pricing made more reasonable.” —Nate Elliott, when the economy gets rough, marketers shift budgets from principal analyst, Forrester Research, as quoted in BtoB above-the-line programs to below-the-line—that is, they trade off magazine, April 6, 2009 longer-term effects of brand-building for the shorter-term need to move product.” CPM pricing for display ads purchased through ad networks is also on the decline. According to the Q4 2008 report from PubMatic, This thinking was echoed by the results of an April 2009 survey display ads sold through ad networks decreased by 48% in that among 129 marketers conducted by the Association of National quarter compared with Q4 2007. More recently, CPMs on ad Advertisers (ANA). In the study, two-thirds of marketers said they networks were estimated to be down by 20% to 30% in Q1 2009 had shifted their focus to more short-term strategies over the past from Q4 2008, as measured by the Rubicon Project. six months in response to the economy. Of course, this downward CPM trend may also create an Pricing Pressures opportunity. Marketers can buy display ads relatively cheaply Online display ads are typically sold on a cost-per-thousand (CPM) now—at a time when budgets are particularly tight. For brand impression basis. According to Credit Suisse, online display ad marketers, this is a buyer’s market. CPMs are headed downward for the next several years, projected Not only are the lower CPMs on display ads creating potential to fall from an average of $2.46 in 2008 to $2.30 by 2013, resulting savings for advertisers, the decreased volume of display ads in the in a cumulative decrease of 6.5%. Note that these prices are aggregate is reducing the clutter of online ads. Many studies, representative of traditional banner ads. Online video ads, for including one by Nielsen, report that having fewer ads per example, typically garner a CPM of $15 or higher. Webpage results in significant increases in unaided recall. ® Online Brand Measurement: Special Report 14
  • 15. What Spending Trends Say About Online Brand Measurement Beyond Banners: Other Online Formats Will Boost Importantly, when all the branding-related components Overall Branding Dollars are combined, the aggregate dollars show a positive While traditional display ad units—mostly banners—currently growth rate for every year from 2009 though 2013. Total represent the bulk of brand-oriented ad dollars online, other forms online branding dollars will rise 1% in 2009 and 10.4% in 2010, of online brand ads are growing at a much faster rate. In addition to followed by double-digit increases thereafter. banner ads, totaling $4.7 billion in 2009, rich media and video ads US Online Advertising Spending Growth, by Format account for another $2.7 billion. Other forms of brand advertising— and Objective, 2008-2013 (% change) mainly sponsorships—make up an additional $300 million, bringing 2008 2009 2010 2011 2012 2013 total online brand ad spending in 2009 to $7.7 billion. Video 126.5% 43.5% 42.5% 40.5% 48.6% 30.6% Rich media -0.8% 3.0% 9.4% 12.4% 13.5% 12.0% US Online Advertising Spending, by Format and Sponsorships -39.2% -17.7% 9.4% 10.8% 13.5% 10.4% Objective, 2008- 2013 (millions) Display ads 9.4% -4.6% 3.6% 4.4% 7.8% 2.2% 2008 2009 2010 2011 2012 2013 Branding total 8.0% 1.0% 10.4% 12.7% 18.2% 12.4% Display ads $4,877 $4,655 $4,824 $5,034 $5,426 $5,543 E-mail -4.5% -3.2% 2.6% 7.1% 9.6% 10.4% Video $734 $1,054 $1,501 $2,109 $3,134 $4,092 Search 19.8% 13.4% 13.2% 10.6% 11.2% 10.2% Rich media $1,642 $1,691 $1,849 $2,079 $2,359 $2,641 Lead generation 6.3% 4.8% 9.4% 10.8% 11.9% 8.8% Sponsorships $387 $319 $348 $386 $438 $484 Classifieds -4.4% -15.9% -9.7% 5.9% 10.8% 5.1% Branding total $7,640 $7,718 $8,522 $9,608 $11,357 $12,760 Direct response total 11.8% 6.2% 8.9% 9.9% 11.2% 9.4% Search $10,546 $11,956 $13,534 $14,969 $16,648 $18,340 Grand total 10.6% 4.5% 9.4% 10.8% 13.5% 10.4% Classifieds $3,174 $2,671 $2,412 $2,554 $2,831 $2,976 Lead generation $1,683 $1,764 $1,930 $2,138 $2,393 $2,604 Source: eMarketer, April 2009 104366 E-mail $405 $392 $402 $431 $472 $521 104366 Direct response $15,808 $16,783 $18,278 $20,092 $22,343 $24,440 total For additional information on the above chart, see Endnote Grand total $23,448 $24,500 $26,800 $29,700 $33,700 $37,200 102197 | 104363 | 104366 in the Endnotes section. Note: numbers may not add up to total due to rounding Source: eMarketer, April 2009 104363 Video ad spending alone will climb at a 40%-plus growth rate for 104363 the next few years. For additional information on the above chart, see Endnote 102197 | 104363 | 104366 in the Endnotes section. A Special Note on Social Media Dollar Trends While social media spending by US advertisers was on an upward trajectory until the recession hit, eMarketer now predicts the market for social network advertising will actually decrease by 3% in 2009. The lack of measurement standards, or even a clear idea of what and how to measure, is the primary factor inhibiting spending. Surveys can be misleading, particularly if the results are misinterpreted. If you poll advertisers, they will tell you that even in the face of this recession, they are planning to boost their spending on social media. In fact, several recent surveys, including ones from Aberdeen Group, Millward Brown, Forrester and MarketingSherpa, suggest that about one-half of advertisers or more plan to increase their social media spending. But even if these increases happen, they will be from very small bases. According to Forrester, three-quarters of marketers looking to do social media advertising have earmarked only $100,000 or less. ® Online Brand Measurement: Special Report 15
  • 16. Drill Down: What Are the Problems? What are the fundamental problems with online Joe Laszlo brand measurement today? Ask a few dozen Director of Research Interactive Advertising Bureau, experts—from agency executives and marketers trade association to representatives from the various trade associations and research firms—and you will “There are two big problems: I’m hearing from our publisher members that there is a kind of panel fatigue among people who likely get a few dozen answers. are asked to take online surveys that are quantifying brand impact. Panel recruitment and response rates are issues. The eMarketer posed the question directly to experts in the field of second is an assumption that the Internet is not good for online measurement, and the responses were, predictably, all over branding—there is a continued lack of awareness on the part of the map. And that fact alone—that the players can’t even agree on marketers and agencies.” Full Interview where to begin—is the overarching problem. Fortunately, though, a closer analysis reveals several common themes that indicate the Michael Mendenhall problems are so highly interrelated that solving one can solve Chief Marketing Officer others at the same time. Hewlett-Packard, marketer Q&A: What is the single biggest problem with online brand measurement today? “Marketers monitor the front end and the back end so they see clickstreams and commerce.The difficult part is the qualitative part Bob Liodice in between, which is the level of engagement.The challenge is to President and Chief Executive Officer begin to build technological capabilities that allow them to see the Association of National Advertisers, complete digital footprint that a consumer leaves when they engage trade association with the brand and then be able to address that consumer in a relevant way—behaviorally, contextually or both.” Full Interview “In our marketing accountability survey, only about 33% of marketers were satisfied with their marketing accountability and measurement Young-Bean Song programs.We don’t have enough standardization or enough useful Senior Director of Analytics & Atlas Institute marketing media mix intelligence and understanding. Studies and Microsoft Advertising, research offer guidance, but marketers complain that by the time Microsoft Corp.’s digital marketing and media solutions provider they get the answers back, the media world has shifted and the mix or model is no longer relevant.” Full Interview “I think it’s not having those foundational reach, frequency and GRP metrics. You will never see P&G and Unilever spend more than Curt Hecht single digits (millions) unless we give them reach, frequency and President GRPs. Their entire business model is based on media mix models Publicis Groupe’s VivaKi Nerve Center where those are the inputs and the outputs.” Full Interview (includes Digitas, Starcom MediaVest Group, ZenithOptimedia and Denuo) A General Apathy Toward Branding “I think it’s really hard to create a panel of size and scale and a In this harsh economic environment, does branding even matter technique to do surveys that aren’t interruptive. You can do to marketers? custom one-offs with one of the research companies that don’t scale or are very focused on individual campaigns, but they don’t “Branding is the hardest thing to justify, and everybody looks to tell the whole story.” Full Interview that budget first,” as Bob Thacker, the senior vice president for marketing at OfficeMax, told Advertising Age in May 2009. Any progress or advancements made in the field of online brand measurement will be heavily dependent on the overall demand for brand-oriented advertising. Due to the economy and resultant short-term sales pressures today, it appears branding will be taking a bit of a backseat to other business priorities, at least according to most of the studies and surveys eMarketer evaluated for this report. ® Online Brand Measurement: Special Report 16
  • 17. Drill Down: What Are the Problems? “However strongly you believe in your brand, Similar results were found by Heidrick & Struggles in a December you have to do your bit to reduce spending 2008 survey of US senior executives. Branding took sixth place at tough times like these.” —Marty Ordman, vice among their top priorities over the next 12 to 18 months. president, marketing and communications, Dole Food Co., Top Priorities in the Next 12-18 Months According to speaking at the ANA Brand Conference, as cited in US* Senior Executives, November-December 2008 (scale of 1-5**) Advertising Age, May 13, 2009 Acquire new customers 4.22 In the one clear exception to the rule, the ANA released results Increase customer retention 3.90 from a “Brand Building in Tough Times and Beyond” study at its Increase customer lifetime value 3.74 May 2009 conference of the same name. In close alignment with the theme of the conference, 74% of senior marketers responded Improve marketing ROI 3.64 that “brand equity” is very important to their company’s success. Launch new products/services 3.59 Increase brand awareness 3.46 Yet a wealth of other survey data suggests otherwise—namely, that brand-building will remain a low priority during the recession. Improve marketing's impact on shareholder value 3.36 The ANA survey provides the first case in point. In its sampling of Acquire, develop and retain talent 3.31 129 marketers, two-thirds admitted that the recession had shifted Expand to new geographies 2.62 the focus of their companies to short-term results, as opposed to Note: n=111; *90% of respondents are US-based; **1=not important and the longer-term results associated with branding. 5=extremely important Source: Heidrick & Struggles, "The Digital Marketing Standard," provided to According to a recent MarketingProfs survey conducted among eMarketer, April 20, 2009 103672 670 marketers in October 2008, while more than one-quarter of emarketer_2000584_103672 respondents identified customer acquisition (29.9%) and customer Another survey, from Datran Media, shows that the marketers’ retention (26.6%) as top goals, only 15.4% cited “creating current focus on driving customer acquisition and retention at the awareness for long-term brand-building” as a top priority. expense of brand-building goals (such as increasing brand awareness or favorability) is not just a US trend. The survey, Most Important Marketing Objective According to US Marketers, October 2008 (% of respondents) conducted among 3,000 marketers worldwide, found that while increased customer acquisition and retention were rated most Acquire new customers not currently in the category 29.9% important by 63.2% and 43.7% of respondents, respectively, only 14.1% rated branding measures as highly. Customer retention (upsell, encourage repeat purchase) 26.6% Advertising Goals for 2009 According to Marketers Lead generation to support sales Worldwide, by Level of Importance (% of respondents) 21.3% Most Important Less Least important important important Creating awareness for long-term brand building New customer 63.2% 32.7% 2.2% 2.6% 15.4% acquisition Taking customers away from competitors Increased brand 14.0% 48.7% 26.0% 11.3% awareness 7.0% Increased brand 14.1% 48.7% 26.6% 11.4% Note: n=670; numbers may not add up to 100% due to rounding favorability Source: MarketingProfs, "Impact of Economic Crisis," provided to Increased 43.7% 43.7% 7.8% 5.6% eMarketer, October 20, 2008 customer 098997 retention emarketer_2000584_098997 Note: n=3,000+; numbers may not add up to 100% due to rounding Source: Datran Media, "3rd Annual Marketing & Media Survey," January 27, 2009 101242 101242 ® Online Brand Measurement: Special Report 17
  • 18. Drill Down: What Are the Problems? Similarly, in the context of interactive campaigns, Forbes Again, even though marketers appear to be temporarily retreating conducted a survey of 112 senior marketers primarily in the US in from branding initiatives, including deploying and measuring early 2009 and found that direct response measurements were online brand campaigns, it does not mean that is the right thing to significantly more popular than branding metrics as a gauge for do. Mr. Liodice, the CEO of the ANA, summed it up best: “It has success. While 70% of all respondents identified conversions as been demonstrated empirically, time and again, that stronger, the leading measure of success and 49% mentioned click-through higher-valued brands lead to stronger, better business results.” rates, only 25% cited brand-building metrics. A Preoccupation with Search, at the Expense Most Important Metrics for Measuring Online Marketing Campaign Success According to US* of Branding Senior-Level Marketing Executives, by Budget Size, In the InsightExpress poll conducted for this report, 83.7% of February-March 2009 (% of respondents) marketing professionals from a variety of disciplines and $1 million+ All companies agreed or strongly agreed with the following statement: (n=49) respondents (n=112) “Online search—because it’s so easily measured and is Conversions or sales 82% 70% often the last click before a purchase—is getting too Registrations/subscriptions via organization's 55% 52% Website much credit. We therefore undervalue the branding Click-throughs 51% 49% effects of online advertising formats such as banners, Unique views to Website or page where ad or 51% 37% interactive rich media and video.” content was placed Boost in search rank 39% 34% Only 16.2% of respondents were neutral, and not a single one Downloads of data of information 33% 37% disagreed with the statement. Change in target audience awareness/ 31% 25% perceptions of brand US Marketing Executives Who Agree that Online Search Is Given Too Much Credit in Online Brand Customer feedback on Website 16% 26% Measurement, April 2009 (% of respondents) Number of target audience members reached 14% 13% Streams of video or audio content 8% 6% Other 6% 3% Neutral 16.2% Note: *respondents were primarily based in the US Source: Forbes, "2009 Ad Effectiveness Survey," June 1, 2009 Strongly agree 104355 40.5% 104355 Agree The low ranking for branding is partly explained by a survey from 43.2% the ANA. In its October 2008 study, just when the financial crisis began in earnest, marketers were asked to cite methods they were using for measuring brand growth. Fully 70% said the answer Note: n=37; numbers may not add up to 100% due to rounding; no respondents chose "disagree" or "strongly disagree" was “sales and net income,” which is about as blunt and bottom- Source: eMarketer, "Online Brand Measurement Survey" conducted by line a measure as you can get. InsightExpress, June 2009 104493 104493 Method Used to Measure Brand Growth According to US Marketers, October 2008 (% of respondents) Sales and net income 70% Third-party brand equity valuations 15% Shareholder value 9% Household penetration 4% Company culture 3% Note: numbers may not add up to 100% due to rounding Source: Association of National Advertisers (ANA) as cited in press release, October 29, 2008 099230 099230 ® Online Brand Measurement: Special Report 18
  • 19. Drill Down: What Are the Problems? Not surprisingly, brand marketers are frustrated. Having found A few responses from the InsightExpress themselves in hot pursuit of direct response metrics, they are not poll explain why search gets too much getting the answers to the most fundamental questions they have credit: about their online branding efforts. “It’s easy to measure the last click and attribute all Wenda Harris Millard, president of consultancy Media Link and of the credit to search. It’s the perfect attribution immediate past chair of the IAB, explained it this way in an model for the lazy [marketer].” interview with eMarketer: “Brand marketers really want to know who they’re reaching. We keep talking about impressions. They “There is minimal branding and emotional [brand marketers] want classic demographics. Impressions are not transference with SEM marketing. Search does very a substitute for knowing who you will reach. They also want to little to complement a cross-platform marketing know how long someone looked at an ad and what happened. Did plan. Branding through visuals is still paramount in it leave a favorable impression of the brand? Will someone try this getting people excited, and for establishing an product? And did somebody take an action at any point? They emotional connection with a product.” want to create awareness and then know whether they changed a “Generally speaking, marketers attribute 100% of consumer’s perception or induced trial.” transactional performance to search knowing that other preference-building messaging leads the Ms. Millard, who previously held senior sales and media positions consumer down the purchase pathway.” at Yahoo! and Martha Stewart Living Omnimedia, continued, “Brand marketers are frustrated about not getting answers to those basic questions, so they end up looking at online as more of Too many marketers are not even measuring their online branding a performance-oriented medium. The agencies, in many cases, efforts. According to a May 2008 PROMO magazine survey of 148 are using classic direct marketing metrics and trying to measure US marketers (who subscribe to the magazine, which skews brand impact using those metrics—but that doesn’t answer the toward direct response marketers), only 41.5% said they measured marketers’ real questions.” metrics for online brand awareness. A much higher percentage (58.5%) used the far less meaningful click-through metric. Killer Stat for the Purchase Funnel: 94% When a Microsoft Atlas Institute study examined the 90-day Metrics Used by US Marketers to Measure Interactive Campaign Effectiveness, 2007 & 2008 (% of timeline for a typical purchase funnel, it found that companies respondents) often disregard 94% of the data available to them when assessing 2007 2008 online campaigns. The study also revealed that marketers Click-throughs 51.0% 58.5% attribute far too much weight to activity occurring at the very Incremental sales 41.1% 43.5% bottom of the sales funnel, concentrating heavily on the last ad Offer response rates 44.5% 42.9% clicked, which often appears on a search engine. Brand awareness 36.5% 41.5% Lead generation 40.7% 36.1% Traditional AIDA Model Representing Consumer Return-on-promo investment 34.2% 34.7% Purchase Funnel Awareness Increased understanding of customer 26.6% 23.8% Coupon redemption rates 16.3% 19.0% Engagement with Web content 12.2% 16.3% Interest Media impressions 24.7% 16.3% Improved sales margins 4.6% 4.9% Don't measure * 2.0% Desire Does not apply 4.9% 2.7% Note: *not asked in 2007 Source: PROMO magazine, "2008 Promo Interactive Marketing Survey" conducted by Penton Research, May 2008 Action 097957 097957 A January 2008 survey by Sapient found similar results, with only 48% of marketers saying they measured online branding campaigns; in contrast, 71% measured search and 82% measured Website analytics. ® Online Brand Measurement: Special Report 19
  • 20. Drill Down: What Are the Problems? Commenting on the study, Esco Strong, senior group manager of “We’re asking ourselves whether the funnel the Atlas Institute, said, “It’s a myopic view that disregards the construct is actually the right one. The points at the top of the funnel that brought the consumers down research we’ve seen shows that the to the bottom.” Mr. Strong added, “You make someone aware at purchase decision process is far more the top of the funnel, target them with specific information in the complex and nonlinear than a simple funnel. middle, and drive them to buy with search at the end.” [For example,] I don’t think we have a good Not everyone in the industry is in agreement about where in the idea of how peer influence works in a funnel funnel the most work needs to be done. Some, such as Curt Hecht, construct. There’s been very little progress to president of VivaKi Nerve Center, believe the top of the sales evaluate the impact of those [social] funnel is trickiest since it deals with attitudes. “Once you get into conversations on brands.” —Jeff Lanctot, chief real behavior around intent and helping clients come up with strategy officer, Razorfish, in an interview with eMarketer, proxies to show levels of interest, it’s the attitudinal metrics at the April 28, 2009 top of the funnel that are harder to come up with,” said Mr. Hecht, in an interview with eMarketer. Others, such as Ken Mallon, senior vice president-custom solutions Key Stat and ad effectiveness consulting at Dynamic Logic, a firm that According to the Atlas Institute, if marketers only look measures brand metrics for online campaigns, think the ad industry at search, which is often the “last ad clicked,” they are has got the top part of the funnel licked, but the bottom part—tying missing 94% of their engagement touchpoints. intentions to end results—presents the biggest challenge. “The hardest part is the last step, [measuring] what happens after “Some marketers are starting to use the someone makes an intent to purchase,” said Mr. Mallon, in an technology that manages online ad interview with eMarketer. “What happens after someone raises campaigns (the ad-serving platform) to their hand and says, ‘Yes, I do intend to go to that movie. I do intend to buy that car in the next 90 days.’ How does intent assess the impact of all online touchpoints, translate into actual purchase?” instead of basing the optimization of media on the last click before a conversion.” Agreeing with Mr. Mallon is Jeff Lanctot, the chief strategy officer —Jacques Bughin, Amy Guggenheim Shenkan and Marc of interactive agency Razorfish, who told eMarketer in an Singer, The McKinsey Quarterly, October 2008 interview: “[Our clients] see the opportunity to tie attitudinal measures to behavioral measures, and that’s where the Clearly, if marketers are going to spend precious dollars executing complexity comes in. There’s value in measuring those tried-and- online branding campaigns, they ought to be measuring the true attitudinal metrics but also in recognizing that there’s another results—even if it costs a little extra in terms of time and effort. piece to the puzzle—actual behavior. Did consumers purchase? Did they register? Did they take that end action? Digital yields Today, the tendency among online marketers is to measure only valuable insights and also creates incredible complexity.” search and give it most or all of the credit for online conversions. They do this because search results, which often represent the To make things even more complicated, some stakeholders even last ad clicked, are relatively easy to measure. But a wealth of data question whether the standard sales funnel model is adequate to suggests marketers should be applying much more rigorous represent the complexity in today’s digital world. measurement analytics and integrating search and display results to get the complete story on their campaigns. Another factor is frequency. We all know that multiple messages do a better a job convincing consumers to buy a product than a single message. By exposing a given consumer to multiple display messages, in addition to the search text ad they get after a search inquiry, marketers are likely to improve conversion rates. Numerous quantitative studies prove that when display ads are combined with search, marketers can expect a significant increase in sales conversions, whether those take place online or offline. (See Data Spotlight section of report.) ® Online Brand Measurement: Special Report 20
  • 21. Drill Down: What Are the Problems? “The challenge is that people are applying “If I don’t have a display campaign to support direct metrics in many cases to what is my paid search campaign, I’m basically inherently a branding campaign. We need to giving the traffic away to my competitors.” continue to evolve the brand metrics in order —Robert Murray, CEO, iProspect, “Search Engine to make sure we are using the right metrics Marketing and Online Display Advertising Integration to measure what the campaign objectives Study,” May 2009 are. But to simply use direct metrics to measure brand campaign performance is Overall, the iProspect study concluded that Internet users were never going to be successful.” —Pam Horan, more likely to engage with or make a purchase from brands with president, Online Publishers Association, in an interview which they were already familiar, and online brand ads are one way to get there. with eMarketer,April 27, 2009 Additional comScore research, conducted with Starcom USA, reveals no correlation between display ad clicks and basic brand An Addiction to Clicks metrics. In other words, if you look only at clicks, you’re Clicks represent the low-hanging fruit of measurement—and that is considering only a tiny fraction of the economic value of an online why marketers tend to seek them out with a vengeance. But clicks advertising campaign. Study after study has shown that online do not even begin to capture the full value of online display ads. display ads generate awareness and interest—even if those ads According to comScore, two-thirds of Internet users never click on never get clicked. display ads over the course of a month; moreover, only 16% of Why have clicks become the default standard for online brand Internet users account for 80% of all clicks. That helps explains measurement? Very simply, because they are so easy to measure. why the average click-through rate for display ads has plummeted Jim Meskauskas, vice present/director of online media at over the years to a mere 0.1%. (Note that online video ads can still Omnicom-owned ICON International, put it this way in an e-mail to elicit click-through rates in the 1% to 4% range, but that is likely to eMarketer: “Every client is a branding client, until they get their taper off over time.) first tracking report. Then they turn into direct marketers.” Or, as Kathryn Koegel, former DoubleClick researcher and a “The majority of marketers are not actually principal at media research consulting company Primary Impact, using the Web for brand advertising. They’re wrote in her May 2009 “The State of Digital Display” white paper: using it for direct response and promotion.” “We have built a parallel universe that does online little service to —Jim Spanfeller, president and CEO,, treasurer its power for marketing and placed too much responsibility on a of the OPA and chairman emeritus of the IAB, in an click on a small graphic image, rather than the fundamentals of interview with eMarketer, April 2009 media planning and creative.” A January 2009 study commissioned by iProspect and conducted If there was one point on which all the professionals eMarketer by Forrester Consulting shows that when Internet users were interviewed for this report could unanimously agree, it was that if exposed to a promotional ad, less than one-third (31%) of them your goal is to build brands, clicks are the wrong way to go. clicked on the ad itself; however, a plurality did take some other form of action: “Because of our direct response heritage [in ■ 27% searched for the product, brand or company using a the online advertising industry], we’ve search engine. toiled under the tyranny of the click for too long.” —Randall Rothenberg, CEO, Interactive ■ 21% typed the Web address directly into their browser and Advertising Bureau, as quoted in Advertising Age, navigated to the advertiser’s site. March 30, 2009 ■ 9% investigated the product, brand or company through social media. Another 37% of respondents in the iProspect study claimed to be completely nonresponsive to “any such ads.” ® Online Brand Measurement: Special Report 21
  • 22. Drill Down: What Are the Problems? The Scourge of Clicks Do Traditional Measurement Techniques Work for If there are any lingering doubts about counting clicks, talk to Gian New Media? Fulgoni, chairman of comScore. Having accepted the fact that clicks are not the answer, what about adopting the measurement techniques of traditional media? In an interview with eMarketer, Mr. Fulgoni gave a clear and impassioned argument for moving beyond the click-through as a For years, those inside and outside the Internet ad industry have metric for online branding success. The problem arose, he said, debated whether standard offline metrics, most notably GRPs when the Internet was first evolving as an advertising medium. (gross rating points), page impressions, reach and frequency, The technology community at the time had “a very short-term should be applied to the digital space. view of how advertising works that was direct-response-oriented, On one hand, many have said that the typical forms of not branding-oriented,” said Mr. Fulgoni. measurement for traditional media do not translate well online. Because the click-through rate was so easy to measure, it got the Nor do these metrics take into account the Internet’s unique industry into a direct response groove, which has in turn led to a interactive qualities that allow for two-way communications with serious undervaluing of branding online. consumers. In a word, they feel these forms of measurement are inadequate, or even irrelevant. “Let’s just accept that the click is not telling the whole [branding] story,” said Mr. Fulgoni. “We don’t hold traditional media to that Scott Knoll of Datran Media put it well in a recent iMedia same level of accountability. We don’t say you need to Connection article: “The models that have been in use up to this immediately pick up a phone and call somebody if you see a TV ad point most resemble the proxy- and panel-based models of or if you’re listening to a radio ad or read something in a magazine. broadcast [television] and fail to represent the very thing that Why should the Internet be measured by this immediate response makes [the digital] industry different—its interactivity.” metric called the ‘click’?” Mr. Fulgoni recently wrote a white paper entitled “How Online “It’s like going to a 3-D movie without the Advertising Works: Whither the Click?” which culled data from glasses. The Internet is more dimensional, more than 200 studies and was published in the June 15, 2009, but [for the most part] measurement criteria issue of the Journal of Advertising Research. The white paper are the same as for a one-way medium. You concluded that an ad impression on the Internet works just like an don’t have the glasses so you’re not ad impression in traditional media. appreciating the dimensions.” —Matt Freeman, According to Mr. Fulgoni, people who are exposed to a display ad— CEO, Betawave, as quoted in AdWeek, March 23, 2009 whether or not they click on it—have “an increased likelihood of visiting the Website of the brand in the ad, an increased likelihood Others argue that the power and possibilities of social media of conducting a trademark search query, an increased likelihood of programs that allow for deep consumer engagement are completely buying online, an increased likelihood of buying offline.” ignored by traditional reach and frequency measurements. “[The display ad] has a lasting effect,” concluded Mr. Fulgoni. But don’t write off traditional media measurements and metrics “Cumulatively, impressions build up over time and create an just yet. There is a growing movement to support the application image of a brand. Then when you go off and do a search, you’ve of tried-and-true GRPs to Internet ad planning and measurement, got the brand better established in your mind.” and this may well be a key to opening up the floodgates for more media dollars and advertiser interest. While direct response is attractive to marketers because of the immediate gratification of almost-instant results, they must take a The key here is making online comparable to other media. “On the longer view when measuring branding effects, which are one hand, you’ve got incredible [measurement] granularity on the cumulative in nature. Web and a lot more insight into your brand metrics,” said Jim Spanfeller, president and CEO of, in an interview with Click-obsession leaves marketers with a very crude and eMarketer. “On the other hand, you really can’t compare that in inadequate accounting measure that ignores most of the potential any way, shape or form to your offline spend.” value of an ad. They do not know if the ad created awareness in the mind of the consumer, if it served as a reminder to buy the product at a later time, if it created a more favorable impression of the brand or reinforced loyalty to the brand. These attitudinal shifts simply do not happen in the instant of a click. ® Online Brand Measurement: Special Report 22
  • 23. Drill Down: What Are the Problems? Integration Is Hard When Data Is Locked in Silos Attitudes of US Marketers Toward Marketing During In eMarketer’s interviews with professionals who are experts in the Economic Crisis, November 2008 (% of respondents who somewhat or strongly agree) the field of building models and processes for online brand measurement, it was clear that unlocking data silos is a critical Due to the suffering economy, marketing efforts are under greater scrutiny than ever before step toward connecting the dots of media measurement. As 89% Razorfish’s Jeff Lanctot told eMarketer, “For all the talk about the Internal silos are the biggest barrier to integrating marketing integration of traditional and digital media, they’re still bought in with customer experiences isolation much more than they’re bought in integrated packages.” 78% Managing our brand across multiple platforms is a big challenge for my organization “The single biggest issue advertisers are 71% dealing with is how to use online properly in Note: n=101 combination with other marketing Source: JupiterResearch and Verse Group, "A Shift in Marketing," provided to eMarketer, December 7, 2008 activities. To get there, we need data 100379 integration and that’s the hard part.” 100379 —Bob Barocci, president, Advertising Research A more recent study, conducted in March 2009 by TNS Media Foundation, in an interview with eMarketer, April 2009 Intelligence and sponsored by rich media provider Eyeblaster, found that while 67% of senior marketers are now running cross- In an interview with eMarketer, Cary Tilds of Mindshare-Team channel campaigns, a scant 12% are integrating performance data Detroit said, “The current approach to planning media is what I across channels. would call the buckets-of-money approach. You have a TV bucket, a When it comes to integrating digital and traditional media, too digital bucket, a search bucket, you might have an emerging [media] many marketers feel as though they are operating in the dark. Two bucket. You have buckets of money. The unspoken controversy is separate surveys bear this out. about switching money from one bucket to another.” In the study by Heidrick & Struggles of 111 US senior marketers, a Ms. Tilds added, “But the buckets of money approach has nothing paltry 15% of respondents claimed satisfaction with their to do with how people consume media. A good media planner optimization of the marketing mix. needs to figure out how to allocate money against the consumer journey—and that is a very complex problem. You have to identify Another study, jointly conducted by the 4A’s and the ANA, found all the knowns and unknowns in the long string of mathematical that only 7% of US marketers said they were “very satisfied” with equations that we need in order to move from buckets of money their progress toward integrating online and traditional media. to consumer-centric planning.” Satisfaction Level of US Marketers with Their Further proof that data silos are a problem comes from Company's Progress in Integrating Traditional and quantitative surveys. According to a November 2008 study by Digital Media, Q1 2009 (% of respondents) JupiterResearch and Verse Group, 78% of US marketers agreed Very satisfied 7% that internal silos act as the biggest barrier to integrating Somewhat satisfied 52% marketing. A related concern was “managing our brand across Neutral 10% multiple platforms.” Somewhat dissatisfied 23% Very dissatisfied 8% Note: n=122 client-side marketers (members of ANA) Source: Association of National Advertisers (ANA), 4A's and Bellwether Leadership Research & Development, "Integrating Traditional and Digital Media," provided to eMarketer, April 23, 2009 103373 103373 ® Online Brand Measurement: Special Report 23
  • 24. Drill Down: What Are the Problems? Among the obstacles to integrating traditional and online media, He added, “The challenge for marketers is to begin to build according to the joint 4A’s/ANA study, were the lack of metrics technological capabilities that allow you to see the complete and an insufficient understanding of digital media among digital footprint a given customer leaves when they engage with senior management. your brand. You need to be able to understand that behaviorally and/or contextually and address that consumer in a relevant Challenges of Integrating Traditional and Online Media According to US Marketers, Q1 2009 (average way…. Where most marketers struggle is they do not have the ranking*) information technology capability and/or management to do that. Having metrics to properly allocate the mix of traditional and You need a sophisticated CRM platform that allows you to identify digital media somebody coming through search or display, and gets them to opt 4.25 in and [allows you to] start to manage them…. Marketers need the Key people at company lack understanding of digital media ability to pull strategic information out of the digital footprints that 3.95 consumers are leaving.” Reluctance to move funds from "tried and true" practices of the past In an interview with eMarketer, Martin Nisenholtz, senior vice 3.89 president for digital operations of The New York Times Co., Internal organizational silos impede a focused enterprisewide provided a publisher’s perspective on the online/offline data approach integration problem. “The thing that I continue to hear over and 3.74 over again from people is, ‘Gee, I wish I had a way to tie my online It is difficult to get multiple agencies to collaborate effectively brand measures to my offline brand measures so that I could on integration standardize,’” he said. “If I’m spending X amount of money on 3.41 television and Y amount on the Web, wouldn’t it be great if I could Note: n=122 client-side marketers (members of ANA); *on a scale of 0-5 look at one set of metrics and determine whether the offline plus where 0="no problem at all" and 5= "a major problem" Source: Association of National Advertisers (ANA), 4A's and Bellwether the online were more powerful together, whether the online on its Leadership Research & Development, "Integrating Traditional and Digital Media," provided to eMarketer, April 23, 2009 own has efficacy and whether the offline without the online is 103375 much weaker or not.” 103375 The top frustration among agency executives, on the other hand, Online Silos was that their clients do not fully understand how consumers use Of course, data silos also exist within the interactive platform. digital media. According to an iMedia Connection article by Scott Knoll, a vice president at Datran Media, “The problem is not the existence of The study also identified challenges in measuring marketing ROI. the data. The problem resides in separate measurements for On a scale from 1 to 5 (where 5 represents “a major problem”), the search, display, email, video, and mobile, creating…‘data smog.’” top challenges were data scattered across the organization (3.2), difficulty allocating enough resources to do the work (3.2) and Kathryn Koegel, in her May 2009 white paper about the state of inconsistent data formats (3.1). online display ads, identifies intra-Internet silos as a major obstacle to online advertising efficiency and success. “The silo-ing In an interview with eMarketer, Michael Mendenhall, senior vice of media into online vs. offline, direct vs. branding, search vs. president and chief marketing officer of Hewlett-Packard, had display, behavioral vs. contextual, undercuts the creation of media much to say about the problems and solutions for data silos. plans that address actual consumer purchase processes in the “Many marketers have disparate databases that don’t speak to most efficient manner,” she wrote. each other, so they don’t have a 360-degree view of a customer…. As you think about Fortune 500 companies that are selling across a portfolio and selling brand experiences, it becomes very hard to Too Much Information, Too Much Complexity Another major obstacle to online brand measurement is the sheer sell based on a portfolio approach without appropriate analytics.” tonnage of data to be extracted, filtered and integrated—as well as the mind-numbing complexity that data creates. “The problem with online is we have too much data, actually.” —Jon Gibs, vice president- media analytics, Nielsen Online, in an interview with eMarketer, April 17, 2009 ® Online Brand Measurement: Special Report 24
  • 25. Drill Down: What Are the Problems? While the Internet offers an abundance of possible metrics, that Additional complexity comes from the fact that research and very same plenty creates complexity and confusion. It is relatively measurement firms have widely differing approaches and simple and straightforward when the objective is direct response. methodologies, resulting in wildly varied results. As Mr. Lanctot of The desired behavior is not only easy to measure, it is often near- Razorfish noted, “For a brand marketer, when there’s such a instant. The consumer sees the direct response ad, follows disparity in what would appear to be the most basic of metrics, it through with the call to action, and the marketer can quickly and plants a seed of doubt about the reliability of the data sets or the easily measure the results. measurement program as a whole.” Current Measurement Models Have Limitations “Every day that I read about a new None of the prevailing techniques for measuring online branding technology…I get worried…. The scary thing impact today are without flaws. is how complex [digital advertising] can be.” —Mark Addicks, senior vice president and chief marketing officer, General Mills, in an interview with eMarketer, “Every type of measurement method, be May 4, 2009 it online media research, TV media research…has some level of error When branding is the objective, though, the whole measurement associated with it. There’s [no] magic process is much more complex. First, the intended result—a bullet out there.” —Jon Gibs, vice president, media change in feeling, perception or attitude—is harder to measure. analytics, Nielsen Online, in an interview with eMarketer, Second, the impact of brand-building occurs over a period of time, April 17, 2009 often weeks, months or even years. Third, there are far more dots that need to be connected. Site Intercept/Brand Impact Studies Although widely popular with advertisers, the use of site “Branding is a longer-term proposition. It’s intercept/brand impact ad effectiveness studies, such as those not about recalling a specific ad you saw 5 conducted by Dynamic Logic or InsightExpress, is expensive when seconds ago. It’s about whether people feel multiple studies are run and do not tell the whole branding story. better about a brand or not.” —Young-Bean Relying on the control versus test group approach, they work well for Song, senior director of analytics and Atlas Institute, measuring the brand impact of a specific ad or campaign, but lack Microsoft Advertising, in an interview with eMarketer, scale and do not take into account the longer-term effects of brand April 16, 2009 advertising unless they are run repeatedly over multiple campaigns. In addition, the heavy use of such surveys has led to consumer This brand measurement complexity problem is not unique to the survey fatigue, where the same individuals are polled over and online space, though the Internet adds another layer or two of over. This can result in respondents who are not representative of complexity with its interactive properties. the population being measured. Some, too, question the intercept But it is essential to integrate online data with data from other method itself, since interrupting people with surveys while they media, because branding campaigns are clearly most successful are surfing can lead to somewhat artificial results. when message exposures come from multiple media—a mixture Mr. Hecht of VivaKi, in an interview with eMarketer, pointed out of television spots, a magazine ad, targeted banner and online some of the pitfalls of these intercept measurement techniques. video ads, an outdoor billboard, an e-mail promotion and so forth. When asked what the single biggest problem is with online brand measurement today, Mr. Hecht replied: “It’s the problem of doing either custom one-off research which doesn’t scale, or doing “How can you possibly isolate the effect of studies focused on individual campaigns which don’t give you the any particular piece of communication? All whole story. It’s really hard to go out there and create a panel of of the problems that exist in measuring size, or create a technique to do surveys that are not interruptive advertising and marketing efficacy exist in and that are useful. I’m not seeing a lot of innovation in terms of a every environment—offline and online.” company stepping into that void to provide the kind of research —Amy Fuller, group executive, worldwide consumer and tools needed.” marketing/global products & solutions, MasterCard Worldwide, in an interview with eMarketer, April 28, 2009 ® Online Brand Measurement: Special Report 25
  • 26. Drill Down: What Are the Problems? Mr. Hecht added, “The market’s at the pressure point, in a good way, Social Media and it’s going to force innovation and solutions to come forward.” In a study by the Marketing Executives Networking Group (MENG) of 126 US marketing executives, more than one-third of Another problem with the intercept survey method is that it is not respondents admitted they did not even measure social media very good at measuring multiple forms of online ad messages. Joe activities. One-half claimed to measure raw traffic and one-third Laszlo, director of research at the IAB, said, “One thing…that’s measured clicks, both of which represent crude metrics, even by lacking is a way to assess the effectiveness of your campaign if it Internet standards. runs across a broad swath of the Internet. For example, if it runs across 15 different sites and in conjunction with a search engine Ways that US Marketing Executives Measure the campaign, plus some social media.” Effectiveness of Social Media Marketing Efforts, October 2008 (% of respondents) Panel Measurement Systems Incremental visits or unique visitors to Website 50.0% The alternative to brand intercept studies is panel measurement systems, such as those deployed by comScore and Nielsen. While Clicks this technique has the ability to measure actual surfing behavior, it 33.3% has its own limitations. Panels are best for measuring Website Conversion to leads/revenues traffic and are less effective for measuring ad campaigns that may 31.7% run across dozens or hundreds of sites. They also tend to miss or Page rank (e.g., Google) undercount smaller, long-tail sites. 25.4% Buzz generated (as measured by BuzzMetrics or other In addition, there are the long-standing concerns about measurement service) conflicting data: 22.2% ■ The individual panel measurement firms often show widely Reputation metrics 18.3% differing numbers, such as for site traffic reach or audience size. Ranking on social media metrics sites (e.g., Technorati) ■ The numbers obtained from site-server logs are often 14.3% contradicted by any given panel measurement firm, causing We don't measure social media activities frustration and confusion. 34.9% Note: n=126 Measurement of Social and Video Are Even Source: Marketing Executives Networking Group (MENG), "Social Media in Marketing" as cited in press release, November 6, 2008 Further Behind 099526 While the widespread use of social and video sites by consumers 099526 evokes excitement (and sometimes a little fear) among A full 59% of respondents said they never or hardly ever measured advertisers, the measurement of advertising in these the ROI of social media marketing efforts. Only a little over 12% did environments is vastly underdeveloped. Most advertisers are still so all or most of the time. trying to understand the nature of this consumer activity and how it might translate into appropriate advertising messages, let alone The primary reason so few measure social campaigns is that it is how to measure campaigns in these environments. difficult—59% of marketers in a separate Aberdeen Group study said social media was either “somewhat difficult” (39%) or “very difficult” (20%) to measure. Note that the respondents here were self-identified “best-in-class” companies. The survey also found that only 18% of marketers link activities on social media sites back to revenues or other financial metrics. ® Online Brand Measurement: Special Report 26
  • 27. Drill Down: What Are the Problems? Data Spotlight: How Online Brand Advertising Can Influence Every Online Video Measurement: Promising, but Still Step Along the Consumer Purchase Early Days Funnel Like social media, the online video advertising market is booming with promise, but somewhat lagging in dollars. That is partly due to The Internet can have an impact at every phase a laundry list of measurement issues. A central issue, though, is the tendency to focus on short-term, direct-response-type metrics that along the consumer purchase cycle, from ignore the primary branding-oriented benefits of video. creating initial awareness and interest for a “The instinctual reaction to try and show the sales impact of video product, service or brand, to stimulating campaigns is misguided,” said Mr. Song of Microsoft Advertising. purchases, to delivering post-sales support and “We have studies that show that video, photo-sharing, weather and social media placements look horrible in the online ROI reinforcing brand loyalty. But what about the equation because they’re upper-funnel. People don’t see ads on measurement of this impact? Facebook and then go buy something. Reach, frequency and GRPs…need to be there upfront.” As a crude indicator of how marketers generally value online media, 36% of advertisers in a survey by Morgan Stanley said the However, the lack of transparency for video advertising metrics is Internet was “effective”—considerably higher than for any other only one of several problems confronting the format, according to media. It was not clear from the survey, though, whether 2008 research from MarketingSherpa. marketers were thinking primarily of search, display ads, their own Worst Problems with Video Advertising According to company Websites or other online tactics. US Marketers, October-November 2008 (scale of 1-5*) Effective Advertising Media According to US Clutter 4.1 Advertisers, 2009 (% of respondents) Ad-skipping (DVR, TiVo) 3.7 Internet 36% Media pricing/cost 3.5 Newspapers/magazines 29% Lack of transparency in metrics 3.4 Direct mail 26% Lack of quality media inventory 2.9 TV 22% Difficulty finding mass target 2.8 Radio 14% Difficulty in buying media 2.3 Billboards 5% Note: n=1,083; *1=no problem and 5=big problem Yellow pages 4% Source: MarketingSherpa, "Video Marketing Survey," November 2008 as cited in "Marketing With Video Report: Online, TV & Mobile," December Other 21% 2008 103550 Note: n=181 103550 Source: Morgan Stanley, "2nd Annual Local Ad Survey & '09 US Advertising Outlook," provided to eMarketer, March 31, 2009 102964 102964 As validation, a more recent ANA study released in May 2009 found that while television was rated the most important media channel in terms of effectiveness (64% of respondents), the Internet was a close second (61%). ® Online Brand Measurement: Special Report 27
  • 28. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel How Display Ads Impact Brand Metrics Online Advertising's Effect on Brand Metrics in the Dynamic Logic, InsightExpress and other survey firms have US, by Level of Campaign Performance*, Q4 2008** (% conducted countless studies—covering all types of product of respondents impacted) categories and services—to measure the brand impact of online Aided Online ad Message Brand Purchase brand awareness association favorability intent display and video advertising. awareness Top 8.9% 14.0% 9.5% 7.5% 7.1% The latest aggregated data from Dynamic Logic, based on 2,380 Average 2.4% 4.9% 2.6% 1.6% 1.3% campaigns measured through Q4 2008, found that those Bottom -2.3% -1.6% -2.0% -3.5% -4.0% respondents exposed to online advertising registered slightly Note: n=2,380 campaigns and 3,889,602 respondents; *best performers higher increases in key brand metrics, on average, than those who are the average of the top 20% of campaigns per metric and worst performers are the bottom 20% of campaigns; **includes three years were not exposed (that is, the control group). The delta lift through Q4 2008 (expressed as a point difference) for exposure to online ads was Source: Dynamic Logic provided to eMarketer, April 27, 2009 103523 2.4 for aided brand awareness and 2.6 for message association. 103523 Online Advertising's Effect on Brand Metrics in the For additional information on the above chart, see US, Q4 2008* (% of respondents impacted) Endnote 103523 in the Endnotes section. Aided Online ad Message Brand Purchase brand awareness association favorability intent awareness Dynamic Logic also compared campaigns for different categories Control 72% 25% 17% 42% 39% of products and, again, found highly differentiated results. For Exposed 74% 30% 19% 44% 40% Delta** 2.4 4.9 2.6 1.6 1.3 example, on the measure of boosting purchase intent, Note: n=2,380 campaigns and 3,889,602 respondents; *includes three entertainment, consumer packaged goods, home improvement years through Q4 2008; **delta defined as point difference in exposed vs. and telecommunications categories performed much better than control groups Source: Dynamic Logic provided to eMarketer, April 27, 2009 average, while apparel, restaurant and retail did relatively poorly. 103522 103522 When it comes to measuring the efficacy of display ads on branding metrics, context appears to matter. According to a study For additional information on the above chart, see by the Online Publishers Association (OPA) and Dynamic Logic, Endnote 103522 in the Endnotes section. display ads within branded content sites (for example,, do a better job of boosting But the above figures are based on across-the-board averages. brand metrics than when those same ads are placed within more Importantly, the creativity and contextual relevance of ad generic portals or ad networks. campaigns can heavily influence the results. When Dynamic Logic Interactive* Advertising's Effect on Brand Metrics in dissected the data, top-performing campaigns boosted key brand the US, by Site Category, January 2009 vs. August 2008 metrics by significantly higher levels than did the lowest- (% change in delta**) performing campaigns. Aided Online Message Brand Purchase brand ad assoc- favor- intent For example, aided brand awareness increased 8.9% for top- aware- aware- iation ability ness ness performing campaigns, versus only a 2.4% increase on average Branded content sites 63% 7% 8% 40% 0% and a drop of 2.3% for the lowest-performing campaigns. Similarly, (OPA members) top campaigns pushed up purchase intent by 7.1%, versus only MarketNorms® database -11% -8% -10% -18% -13% 1.3% on average. Portals -9% -3% -6% -11% 0% Ad networks -21% -7% 0% -18% -40% Note: *involves the audience without having them click through or leave the Webpage; **delta defined as point difference in exposed vs. control groups Source: Online Publishers Association (OPA) and Dynamic Logic, "Improving Ad Performance Online: The Impact of Advertising on Quality Content Sites," January 8, 2009 102827 102827 For additional information on the above chart, see Endnote 102827 in the Endnotes section. ® Online Brand Measurement: Special Report 28
  • 29. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel Multiple studies prove, too, that online video ads can have an Conversion Rate of US Internet Users Exposed to outsize effect on standard brand metrics such as awareness, Search Plus Display Advertising vs. Either Search Only message association and purchase intent. or Display Advertising Only, 2006 (lift vs. display click only) Ways in Which US Marketers See Online Video Enhancing Customer Engagement, 2008 (% of Display click only* 1.0x respondents) Search click--no display impressions 3.3x Increasing brand awareness 71.4% Search click plus display impressions 4.0x Driving lead generation 47.2% Note: *baseline Source: Atlas DMT, "Where Can You Find Your Customer? Try the Enhancing loyalty/retention programs 44.7% Intersection of Search and Display," July 21, 2006 099215 Converting customers 41.6% 099215 Improving service and support 39.8% Similarly, a Specific Media survey found that online display ads can Source: PermissionTV, "Online Video Survey Results," December 17, 2008 boost search activity for many product categories, especially for 100581 travel and tourism, health, personal finance, automotive, news and 100581 media, and property and real estate; the average lift was 155%. Integrating Search and Display Ad Measurements Impact of Online Display Ad Campaigns* on Search Intuition (and plenty of data) tells us that search works best when Activity** in the US, by Advertiser Category, it is complemented by online branding efforts that create September 2007-August 2008 (% lift) awareness, interest and desire among prospects. Travel and tourism 274% First, as consumers ourselves, we realize that often the very idea of Health 260% searching for a particular product or brand comes from having seen Personal finance 206% advertising. Second, when we are looking to possibly purchase Automotive 144% something and conduct a search inquiry, there is a natural tendency News and media 144% to click on those search links that represent brand names we know and trust, and to disregard unknown brands. Property and real estate 125% Retail 69% Most agree that online display ads can act as a stimulus for driving CPG 22% searches for brands or products—which of course is a key step leading to purchase. Average lift 155% Note: *among Specific Media clients; **ad-exposed consumers who “There’s an image, a perception, a value that [consumers] have at searched on brand and/or segment-related terms vs. unexposed the point that they conduct a search. You know, it’s not like consumers Source: Specific Media as cited in press release, December 3, 2008 consumers are sitting there with no impression of a brand, until 100100 they conduct a search,” said Gian Fulgoni of comScore. 100100 “If you see a display ad, there’s an incremental impact, but it’s not In a January 27, 2009, interview with eMarketer, Beverly Thorne, as great as the incremental impact of a search ad,” he added. “If senior vice president of marketing at Century 21 Real Estate LLC, you combine the two, you get synergy and the combination is explained the search/display connection for her brand as follows: greater than the sum.” “Our own empirical results showed us that our online investments were performing substantively better at generating leads. From In an older yet still relevant study by the Microsoft-owned Atlas December 2007 to December 2008, we improved the efficiency of Institute, 11 online advertisers were evaluated by measuring both our lead generation by reducing our cost per lead over 60%. At the their display ads and sponsored search clicks. In the study, Internet same time, we multiplied our number of leads by over 235%.” users exposed to both search and display ads converted at a much higher rate than did those exposed to search or display alone. The mastery of Web analytics plays a key role in tying display ads to search results. According to analysis by Steve Kerho, VP of analytics at Organic, display ads can increase a search ad’s click- through rate by 25% to 30%. Until recently, though, this influence of display ads has typically not been measured by advertisers. ® Online Brand Measurement: Special Report 29
  • 30. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel How Display Ads Impact Online Sales Spotlight: Alltel For most categories of products and services, consumers rely When mobile carrier Alltel measured the sales heavily on the Internet to do research, or “window shop,” prior to conversion impact of search clicks, display ads and making the final purchase. Given this proclivity, marketers have an the synergy of the two, the “search click + display obvious opportunity to influence the awareness, preferences or ad” combination resulted in a 56% lift versus a even behaviors of these online shoppers—at the precise time search click alone. when they are in exploration or consideration mode. In the 90 days leading up to a sale, consumers see an average of 18 ads for a Source: Atlas Institute, Microsoft product, according to Microsoft’s Atlas Institute. eMarketer estimates that 152 million people, or 86% of Internet How Display Ads Drive Site Traffic users ages 14 and older, shop or browse online for possible Advertisers often have the goal of driving qualified traffic to their purchases that may or may not occur online. Of course, the corporate or brand Websites. Based on numerous independent tendency to shop on the Web varies by category. A worldwide studies, display ads can help get this job done. survey from Universal McCann indicates that holidays/destinations, consumer electronics and travel are the For example, comScore evaluated 139 studies linking display ads most-shopped categories online. to site visitation levels and found that the average lift in the number of visitors to the advertiser’s site—comparing visitation Products and Services that Active* Adult Internet levels of exposed and nonexposed groups—was 65% during the Users Worldwide Have Researched Online, 2008 (% of respondents) first week following the first exposure to an ad. Additional, though Holidays/destinations 61.9% somewhat muted, lifts were seen in the following three weeks. Consumer electronics (e.g., TVs, PCs) 58.4% Advertiser Site Visitation Among US Internet Users Travel (e.g., flights, trains) 56.9% Exposed to Online Display Ads, 2008 Portable devices (e.g., MP3 players, mobile phones) 56.6% Control Test Lift Mobile phone services 56.0% Week following first ad exposure 2.1% 3.5% 65.0% Computer software 52.3% Weeks 1-2 after first exposure 3.1% 4.8% 53.8% Films 49.8% Weeks 1-3 after first exposure 3.9% 5.8% 49.1% Music 48.8% Week 1-4 after first exposure 4.5% 6.6% 45.7% Books 46.2% Note: home, work and university locations Cars/automobiles 43.7% Source: comScore Brand Metrix, "How Online Advertising Works: Whither Home appliances (e.g., refrigerators, freezers) 39.1% the Click," December 5, 2008 104534 Game consoles/gaming 36.9% 104534 Fashion (e.g., clothing, shoes) 35.0% In another industry-specific example, a joint study by comScore Financial services (e.g., credit cards, banking, insurance) 31.1% and analytics firm Crossix Solutions, in partnership with Yahoo!, Property/real estate 29.7% evaluated the ability of display ads to drive consumers to Cosmetics 27.5% pharmaceutical advertisers’ Websites. After seeing online display Personal care (e.g., medicines, contact lenses, etc.) 24.1% Groceries (food) 18.7% ads, consumers were more than three times as likely to visit Utilities (e.g., gas, electricity, etc.) 16.1% pharma advertisers’ Websites and twice as likely to fill a new Groceries (nonfood e.g., cleaning products) 15.5% prescription. In addition, exposed consumers were 92% more Alcoholic beverages 12.3% likely to search for trademark names and phrases compared with Nonalcoholic beverages 9.1% those who did not see the display ads. Note: n=17,000 ages 16-54; *daily or every other day Source: Universal McCann, "When Did We Start Trusting Strangers?," The study was conducted among a base of 73 million consumers September 2008 and concluded that the display ad campaigns provided an 098382 estimated return on media investment of 3X. Not a bad ROI. 098382 ® Online Brand Measurement: Special Report 30
  • 31. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel A study by Penn, Schoen & Berland Associates found that US For example, while display ads alone provided a 42% lift (test online shoppers would research high-consideration products and versus control) on the percentage of consumers making a retail services, such as cars, computers, new doctors, vacations and purchase online, and search generated a 121% lift, the combination mobile phone plans, prior to making an actual purchase. of search and display ads together produced a 173% lift. Further, the one-two punch of search and display resulted in significantly Products/Services that US Online Shoppers Would higher dollar spending per thousand consumers exposed. Research Significantly Before Buying, October 2008 (% of respondents) Online Retail Sales* from US Internet Users Exposed Car 85% to Online Display and/or Search Ads, 2008 Control Test Lift New computer 83% Display only $994 $1,263 27% New doctor 83% Search only $1,548 $2,724 76% Vacation 75% Search and display $2,723 $6,107 124% Mobile phone plan 72% Note: home, work and university locations; *monthly sales per thousand exposed consumers ranging from two weeks to three months after the Vacuum cleaner 58% initial exposure Source: comScore Brand Metrix, "How Online Advertising Works: Whither Apartment 57% the Click," December 5, 2008 104453 Exercise plan 47% Movie 43% Percent of US Internet Users Who Make an Online Purchase on the Advertiser Site After Being Exposed Book to read for pleasure 32% to Online Display and/or Search Ads, 2008 Children's toys 31% Control Test Lift Shampoo 22% Display only 1.0% 1.5% 42% Search only 1.1% 2.4% 121% Note: n=300 ages 18+ Source: Penn, Schoen & Berland Associates, Inc. (PSB), "LinkShare Search and display 1.9% 5.1% 173% TrendWatch Research: New Info Shoppers, Recession Buyers, and the 2009 Note: home, work and university locations; retail sites only Online Shopping Outlook," January 30, 2009 Source: comScore Brand Metrix, "How Online Advertising Works: Whither 102845 the Click," December 5, 2008 102845 104456 104453 But less expensive products are increasingly researched online as 104456 well. According to Jeffrey Grau, eMarketer senior analyst, How Display Ads Influence Offline Purchases consumers today access the Internet to look up even relatively low-interest products such as shampoo. Said Mr. Grau, “The current lack of visibility into offline “Consumers might go to a shampoo manufacturer’s site to learn purchasing [as a result of online display whether a product contains paraben preservatives, or is tested on advertising] consistently leads to dramatic animals or made from animal ingredients. They also might visit a retailer’s site to read customer reviews to hear from others underestimation of display advertising ROI.” whether a shampoo is really unscented or causes scalp irritation. —comScore white paper, “How Online Advertising Works: Consumers also go to coupon sites to get additional savings on a Whither the Click?” December 2008 shampoo purchase.” Unfortunately, while online advertising can have a substantial Display/branding ads can also influence consumers to the point of impact on offline sales, most marketers fail to measure this purchasing products online, though rarely is the impact in the form important connection. of an immediate click. According to McKinsey’s June 2008 digital advertising survey of In several studies, comScore evaluated the combined influences 340 senior marketing executives worldwide, only 30% said they of search and display ads on consumer online buying behavior. even considered the offline impact of online marketing. However, Search, given its obvious indication of purchase intent (that is, marketers that did look at those metrics were more satisfied with those who take the time to search for a product are usually in- their online efforts and said they planned to increase spending on market), has a stronger influence on consumer buying behavior them by 38%. than display ads alone. But when both search and display ads are combined, the overall impact is significantly greater than that of either search or display ads individually. ® Online Brand Measurement: Special Report 31
  • 32. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel To be fair, integrated measurement systems are often difficult and In the aggregate, Forrester estimates that in 2009, Web-influenced pricey—but in the long term, for marketers that measure search or cross-channel store sales will reach $758.8 million, dwarfing the and display advertising together, the results can be particularly sales transacted directly online. In other words, the Web’s influence encouraging. A September 2008 comScore study found that by on sales is much greater than its direct e-commerce impact. using search and display ads in combination, marketers can US Retail Sales, by Channel, 2007-2012 (millions) significantly boost the dollar value of offline retail sales versus using either search or display only. 2007 $1,873,673 Incremental Impact on Offline Sales per Thousand US $503,734 Consumers Exposed to Search and Display Ads vs. $174,466 Search Only and Display Only, 2007-2008 (% lift) 2008 Search and display 119% $1,793,624 Search only 82% $629,228 $204,018 Display only 16% 2009 Note: n=137 tests from comScore Ad Effectiveness Database conducted in $1,711,101 2007 and 2008 Source: comScore, "Maximizing the ROI from Internet Advertising: Lessons $758,792 Learned," September 8, 2008, provided to eMarketer, October 2008 $235,389 099198 2010 099198 $1,633,282 As evidenced by a separate survey conducted by comScore $886,232 Networks and Yahoo!, the search/display combination of ad $267,791 messages increased in-store purchases significantly. In the study, 2011 those online shoppers who had seen both ad types were 43% $1,564,494 more likely to be converted to in-store buyers. In comparison, $1,007,609 consumers who had seen only search ads were just 26% more $301,039 likely to be converted, while exposure to only display ads lifted 2012 conversion by just 6%. $1,498,978 $1,120,709 Effectiveness of Online Search and Display Advertising Campaigns in Converting US Online $334,742 Researchers to In-Store Buyers, 2007 (% change in Offline sales Cross-channel sales Online sales conversions) Source: Forrester Research, "The New Rules of eCommerce," September Consumers who saw a joint display and search campaign and 17, 2008 subsequently made an in-store purchase 098510 43% 098510 Consumers who saw a search campaign and subsequently made an in-store purchase Social Influence 26% Although there is only limited evidence at this point, a few studies Consumers who saw a display campaign and subsequently made suggest that advertising in social media can affect offline sales, too. an in-store purchase 6% A partnership research study involving comScore, dunnhumby Source: comScore Networks Inc. and Yahoo!, "From Clicks to Bricks: The and MySpace was conducted to track offline purchases of Internet Impact of Online Pre-Shopping on Consumer Shopping Behavior" as cited users exposed to ads for a personal-care brand on MySpace. Of in press release, July 30, 2007 086196 the nearly 80 million people exposed to the campaign, fewer than 086196 1% visited an advertiser page on MySpace, though about one-half As a rule, the impact of online research/shopping behavior is who did also visited the personal-care advertiser’s site. greater on in-store sales than Web-based sales. According to Despite this small percentage of visitors, the campaign met its ROI comScore, for retailers with online and offline sales channels, objective. According to Advertising Age (April 13, 2009), “[The approximately 68% of the impact of display ads was found in the campaign] produced $1.28 million in offline sales, as measured by offline channel. dunnhumby, which compared purchases among shoppers not exposed to the campaign with purchases among those who were.” This resulted in an impressive 28% return on marketing investment. ® Online Brand Measurement: Special Report 32
  • 33. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel In sum, marketers who fail to assess the cross-channel impact of Ken Mallon of Dynamic Logic, whose company has evaluated the their online branding efforts—particularly in this economic brand impact of thousands of online campaigns, was very vocal climate—are significantly underestimating their effectiveness. about the need for good creative: “By far the biggest driver of Leading marketers are developing tracking mechanisms that allow brand impact success is the creative. The best ads that we see in for comparisons between offline and digital marketing. And they terms of performance online tend to be ones that almost have a do not have to be complicated or expensive. For example, in order magazine feel. They look nice; people think about things like to track sales across channels, retailers can use online coupons having the right human form in there, the right product shot.” that are redeemable on Websites and in stores. Effective creative can be planned, according to Mr. Mallon. “We have “When you start to link in-store purchase behavior with online a set of 10 standard best practices. The clients that follow those do advertising, it’s incredibly valuable,” said Mr. Lanctot of Razorfish. really well. But most people violate one or more of those routinely, “[It] can help marketers understand how online marketing drives and that’s why online advertising just isn’t that great on average.” offline behavior.” Some in the industry go so far as to say that the creative form of online advertising is not only critical, it transcends the Three Factors for Online Branding Success measurement issue entirely. In eMarketer’s interview with online You can have all the precise numbers, measurement tools and publishing pioneer Martin Nisenholtz, it was clear that finding metrics at your disposal—and completely bomb with your ways to make online ads more emotionally evocative is online campaign if your creative messaging is substandard or paramount to branding success. badly targeted. “I don’t think the measurement issue is holding back brand dollars 1. Don’t Ignore the Creative online. The bigger concern is that the Web still hasn’t found a way Under the pressure of marketing accountability, and in our zeal to to create the kind of emotional involvement that television creates quantitatively measure everything that moves, marketers must for people,” said Mr. Nisenholtz. “I can pretty much promise you not abandon creativity as an essential variable in online branding that television didn’t evolve as a dominant brand-building medium success. Measurement tends to look backward like a rearview because somebody started with a measurement. It evolved mirror, while creativity seeks to shine the headlights on a future because marketers said to themselves, ‘This is an incredibly attitude or action—on the part of the consumer marketers are powerful way for us to communicate and transmit the emotive trying to reach and influence. powers of branding.’ And then they figured out how to measure it. In other words, measures are the tail, not the dog, and the dog As Jon Gibs from Nielsen Online said, “Creative is about 70% to hasn’t yet been invented online. So we have to invent the dog.” 80% of the effectiveness of advertising.” Also speaking from the online publisher’s side is Pam Horan, president of the OPA, who feels there has not been enough focus “If your creative isn’t good, then you aren’t on the creative process and making online ads that engage with going to create engagement.” —Jeff Marshall, consumers. “Creative is a big issue,” she said in an interview with managing director, Pixel, a digital creative agency owned eMarketer. “At the OPA, we’re trying to spur a creative by Publicis Groupe, as cited in The Wall Street Journal, renaissance, so to speak, to show the opportunity for online May 6, 2009 advertising to deliver a rich experience, tell a unique story and a brand-oriented message.” ® Online Brand Measurement: Special Report 33
  • 34. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel 2. Size Matters 3. Focus on Targeting and Relevance When it comes to banners and other forms of display ads, larger, The Internet, partly because it is so fragmented, allows marketers more intrusive ads tend to perform better than smaller ones, on much better opportunities to finely target their messages to the average. Dynamic Logic and InsightExpress studies have proved right individuals, and often at the right time and place. The “spray this correlation. and pray” approach may have worked in the past for traditional The size and shape of display banner ads can also affect media campaigns, but it most certainly does not work on the Web, engagement results, at least as measured by time spent. where consumers almost expect ad messages to be more According to a time-exposure study conducted by Lotame relevant. We have the targeting technology, but we need to use it. Solutions, the large 300x250 rectangle caused Internet users to spend significantly more time with this unit versus more narrow “Don’t count the people you reach, reach the (and creatively limiting) ads, specifically 728x90 and 160x600 banner ads. Consumers spent over 13 seconds with the rectangle people that count.” —David Ogilvy, world-renowned (300x250), more than double the next-best-performing ad unit, the advertising executive 728x90. The large size and shape of these rectangles, which end up smack in the middle of valued content, means they are difficult Studies from Dynamic Logic and InsightExpress, for example, to ignore. show that contextual placements, aligning brand messages that are in sync with the surrounding editorial content, tend to be more Time Spent with Banner Ads Among US Internet effective for highly targeted categories, such as autos, pet care, Users, by Ad Size, January-February 2009 baby and pharmaceutical products. Many other studies support Total Total Average time the ability of contextual placements to boost results. In that exposure time impressions per (seconds) (millions) impression regard, online is no different than other media. (seconds) 300x250 867,700,956 66,466,701 13.05 Another targeting technology experiencing renewed interest 728x90 161,590,364 29,925,805 5.40 among advertisers is behavioral targeting. With behavioral targeting, 160x600 97,539,062 51,938,746 1.88 ads are served up to Internet users based on the past surfing Source: Lotame Solutions, Inc., "Time Exposure by Banner Size," provided behavior of the individual consumer. Conceptually, this means that to eMarketer, April 8, 2009 advertisers are buying audience, not Webpages or impressions. 103793 103793 This is good for the advertiser, since it makes for a more efficient Taking such data into account, Web media publisher, media buy. It’s also good for the publishers, since they can sell for one, is launching a new Website design that features larger-size advertising space that might have gone unsold. And finally, it is ads, as well as exclusive sponsorship placements, to attract potentially good even for consumers, since they are more likely to budget-conscious advertisers. see ads that are relevant to their interests. Furthermore, as one in a series of solutions to the creative Because behavioral targeting has the potential to efficiently get challenge, the OPA recently released three new innovative online the “right” ads in front of presumed interested parties, much like ad units designed to create brand experiences—within the ads. search ads, many in the industry see a resurgence coming in this “The idea is to deliver the brand experience right on the pages of type of technique. these rich content sites [e.g., OPA publisher sites] so people won’t have to click away,” said Ms. Horan. “These units are much larger…. The marketer’s share of voice increases because the consumer is being exposed to a bigger ad for a longer period of time.” ® Online Brand Measurement: Special Report 34
  • 35. Data Spotlight: How Online Brand Advertising Can Influence Every Step Along the Consumer Purchase Funnel Working Toward the Solutions for Online Brand Measurement “These improvements [behaviorally-targeted banner ads], driven primarily by better Big Picture: Five Broad Approaches targeting, will also likely boost aggregate After conducting 24 phone interviews, five video interviews, spending, as advertisers moving online begin several round-robin Q&As and an online survey among industry movers-and-shakers—not to mention poring over reams of data to get the same tracking and metrics that from studies and surveys—eMarketer sees the following five have made search advertising so appealing.” broad approaches as key to moving forward on the online brand —Ned May, director/lead analyst, Outsell, in BtoB magazine, measurement front: April 6, 2009 1. The first critical step for marketers when developing any Forrester Research currently estimates that nearly one-quarter measurement programs must be to identify their brand’s top (24%) of online campaigns rely on some form of behavioral marketing objectives. targeting data. This was substantiated by a February–March 2009 2. Keep in mind that there is no single measurement system that survey by, which reported that 31% of senior-level does it all, nor will there be a silver bullet in the future. marketers were using behavioral targeting. Finally, Datran Media surveyed marketers and found that 65% either already used or planned to use behavioral targeting in the future. “I don’t think the white knight is going to be Of course, behavioral targeting, which relies on cookie technology, riding up on his little pony. It’s going to be has two serious obstacles: the industry working together.” —Pam Horan, president, Online Publishers Association, in an interview ■ Between 30% and 50% of Internet users regularly delete their with eMarketer, April 27, 2009 cookies, rendering behavioral targeting virtually useless for these consumers. 3. A hybrid of traditional and digital approaches will be necessary, ■ Mounting privacy concerns could end up derailing the use of which will require a dramatic reinvention of measurement as behavioral targeting, or at least seriously limiting its impact. we know it. 4. The Internet must be rolled up within existing media mix models. There is a clarion call for the traditional metrics of reach, frequency and GRPs to be integrated with the Web—but this will only be the starting point, not the end game. “There needs to be clear and broad industry education so everybody understands what’s happening.” —Bryan Wiener, CEO, 360i, in an interview with eMarketer, April 2009 5. Connecting all the dots requires collaboration. Key industry stakeholders will need to work closely together to create seamless databases that talk to each other. One top priority: continuously refining attribution models that assign mathematical weights to the various digital footprints captured along the consumer buying cycle. ® Online Brand Measurement: Special Report 35
  • 36. Working Toward the Solutions for Online Brand Measurement Supporting the “primacy of objectives” movement is Ms. Horan of This report represents only a starting point toward the OPA, who told eMarketer in an interview: “It all comes back to igniting a broader, more collaborative coalition that what the campaign goals are. If a marketer is looking for is dedicated to solving the online brand engagement, they have to decide what engagement is. Is it the measurement challenge. As such, it will be made far number of views, is it a behavior post-view, is it a registration?...It stronger by the input, feedback and ideas from you, may be that they’re looking at engagement as hover time…. Or it the reader. Please take the time to share your might be whether a person clicked on something within the ad.” comments and thoughts. Collectively, we can begin to connect the dots. Brand advertisers are all trying to figure out how online engagement can impact their brands, but the starting point is pinpointing the brand’s core marketing objective. It All Starts with Marketing Objectives This was the case with Amy Fuller, group executive, worldwide You can measure many things online, but if metrics do not align consumer marketing/global products & solutions of MasterCard with business objectives, you will not go very far (and you’ll likely Worldwide. In an interview with eMarketer, Ms. Fuller spoke of drive yourself crazy). engagement: “It really starts there—with asking, ‘What is brand In a survey by Spencer Stuart of senior-level marketers, the best health?’ Is it brand opinion, is it willingness to recommend way to measure CMO effectiveness—beyond even profitability and something, is it willingness to pay a premium, is it being revenue measurement—was to make sure that “marketing is mentioned in social networks, is it someone agreeing to receive aligned with the business strategy,” as cited by 35% of respondents. a MasterCard?” She added: “Then, and only then, can we start figuring out, ‘OK, Best Ways to Measure CMO Effectiveness According to US Senior Marketing Leaders, 2008 (% of if we’re happy with how we’re measuring engagement—which respondents) means looking at qualified actions, not simply clicks—how do we capture what effect that has on those eventual brand Marketing is aligned with the business strategy 35% health metrics?’” Profitability 29% Revenue 25% Mr. Mendenhall of Hewlett-Packard put forward a similar perspective in an interview with eMarketer. What brand marketers Perceived value of marketing 7% are looking for, he said, is “very dependent on the strategy and Brand awareness 5% objectives for the specific product launch, service or promotion, Note: n=200+ and those vary. It really depends on what I’m trying to accomplish. Source: Spencer Stuart, "Isolating the Marketing DNA: The Essential Skills and Qualities of the New CMO," November 2008 Am I trying to achieve brand immersion, brand preference or 102334 brand experience? Am I trying to generate a lead and then 102334 manage the lead through to a sale? Am I trying to drive e- commerce or build a lifetime relationship with a customer?” “The most important factor is to have clearly Mr. Mendenhall also noted: “Then you think about how many defined goals from the beginning. What are people come through your front door. How many of those people you hoping to achieve? Focus on five or six stay? How long do they stay? Where do they go? What do they do? key metrics that serve as your guiding If you have a good CRM capability that pulls those analytics, and measurement.” —Chris Thornton, chief marketing you look at the behavioral and contextual footprints, it all becomes officer, Definition 6, as quoted in Adweek, May 18, 2009 incredibly valuable to a marketer. These kinds of analytics become a competitive differentiator.” As Mr. Gibs of Nielsen Online stated at the Digital Publishing and Advertising conference in New York on May 12, 2009, “Counting is The Need for Uniform Standards not the same thing as accountability.” When developing online In television media, advertisers have simple, defined and relatively campaigns, one of the hardest challenges is to identify what limited choices for creative executions, such as the standard 15- specific actions or behaviors you really want to elicit from your or 30-second spot. In radio, the standard is typically 30 or 60 consumer target, along with any emotional or qualitative levers seconds. Magazines offer full pages, half pages and a discrete that enable them. assortment of other choices. The measurement of offline media has become somewhat standardized as well. ® Online Brand Measurement: Special Report 36
  • 37. Working Toward the Solutions for Online Brand Measurement The Nielsen ratings numbers for television, for example, are so “[We need] industry standard measures standardized they operate as the buying and selling currency for everyone can agree on. Measures that go the $70 billion TV business. Of course, few will admit that the beyond just standard clicks and traffic actual measurement process itself is less than perfect. measures.” —Yosi Heber, president, Oxford Hill Partners LLC, in response to an eMarketer poll fielded by “People in broadcast sort of chuckle at the InsightExpress, April 2009 Tower of Babel that we in digital provide by way of data, as they all implicitly agree to In the poll eMarketer organized for this report, 46% of respondents live and die on a ‘standard’ that everyone agreed with the following statement: knows is a proxy for a proxy, with branding “Single standards for ad metrics and online performance standards that are, well, imprecise.” —Mark systems, set by a leading industry group such as the IAB, Naples, managing partner, WIT Strategy, in an e-mail to are the major step needed to boost the growth of brand eMarketer, June 2, 2009 advertising online.” Further, only 27% of respondents disagreed, leaving 27% on But on the Internet, there is a seemingly unlimited number of ad the fence. format options available as well as endless choices for the measurement of online ad campaigns. US Marketing Executives' Opinions on the Need for a Single Set of Online Advertising Measurement Consequently, there is now a tension in the industry between Standards, April 2009 (% of respondents) locking down standards—including agreed-upon definitions and common measurement platforms—and allowing for innovation, Strongly disagree Strongly agree flexibility and creativity. Certainly, most can agree that standards for 10.8% 13.5% definitions are an absolute must. For example, stakeholders should Disagree 16.2% all have the same thing in mind when they talk of impressions. Agree This was emphasized by Jim Meskauskas of ICON International in 32.4% Neutral an e-mail to eMarketer: “We should certainly start somewhere by 27.0% defining how we articulate the ‘facts’ of our discipline (reach, frequency, impressions, engagement).” Note: n=37; numbers may not add up to 100% due to rounding However, Mr. Meskauskas provided an important proviso: “But if Source: eMarketer, "Online Brand Measurement Survey" conducted by InsightExpress, June 2009 what we are talking about pertains to the amorphous (e.g., 104495 engagement), then how we talk about it will also be amorphous.” 104495 So what about standardization of measurement platforms? Many worry that a single measurement technology or company will enjoy a monopoly, similar to the Nielsen model for television buying. Others are concerned that a premature, one-size-fits-all measurement model will stifle innovation and creativity in the industry. The latter concern, according to some, is unwarranted. Said David Smith, CEO of interactive agency Mediasmith, in a June 5, 2009, interview with eMarketer, “Yes, innovation is critical—but only after you’ve run all the numbers, and only as long as you stay within the guidelines.” In other words, the structure imposed by a uniform measurement process will actually provide freedom to innovate and endlessly test creative options. ® Online Brand Measurement: Special Report 37
  • 38. Working Toward the Solutions for Online Brand Measurement When asked to elaborate on why they agreed or disagreed, Ms. Tilds added, “I want to focus on the creativity of the actual media respondents were mixed in their opinions on the need for deployment and not argue about audience composition or over measurement standards. Some felt that the industry needs how to measure something. I want to debate the next big idea. The standards to succeed, while others believed they would be “nice industry needs consistent dialogue, agreement on standards of to have,” but would not “make or break” the growth of brand methodology and support from the IAB, the 4A’s and the ARF.” advertising online: ■ “There needs to be an industry-defined standard on which to “[We need] enough standards to establish a base effectiveness instead of publishers, marketers and strong foundation, but not so many that agencies setting their own baselines.” brands are constrained. [We need] more ■ “The industry needs common ground to set benchmarks and work on conversion attribution…and manage multiple sources of data as a base for broader advances in social graph measurement and discussions about what drives marketing success online.” analytics.” —Jeff Lanctot, chief strategy officer, Razorfish, in an interview with eMarketer, April 28, 2009 ■ “Standards are useful, but the IAB has tried many times to impose them. Realistically, standards won’t be imposed—they’ll Before we jump to the conclusion, however, that measurement be adopted based on which standards are useful and provide standards represent the panacea everyone is hoping for, Mr. valuable feedback to their users.” Lanctot of Razorfish, who personally believes in the formation of ■ “The IAB is going to face big issues around this effort. In many ways standards, added this sobering perspective: “We tend to put too the tent is simply too big for them to be effective in these efforts.” much weight on standards. There’s this view that once we have some better brand measurement standards in place, the dollars ■ “It can certainly help the industry to have standards and best will flow. I think that’s overly optimistic.” practices for ad metrics and online performance systems. However, this will have little effect on the growth of brand Q&A: Should the industry create a standardized advertising online. Marketers will need to determine for online brand measurement platform? themselves (in a variety of ways) the value of online for branding and the metrics associated for their brands. In all likelihood, this will Amy Fuller need to play out in bigger scenarios such as market mix modeling.” MasterCard Group Executive,Worldwide Consumer Marketing/Global Products & Solutions The director of research from the IAB, Mr. Laszlo, supports some MasterCard Worldwide, level of standardization, as he told eMarketer in an interview. “The financial services marketer market as a whole should start to narrow down the total number of metrics,” he explained. “There are so many different things to “There really isn’t a standardized way of looking at brand health, measure that it’s hard to say which metrics are the best to use.” online or offline. Rather than trying to standardize, why not develop a few different ways of looking at brand health?” Full Interview Representing the publisher point of view is Ms. Horan of the OPA. “In the long run,” she noted in an interview with eMarketer, “would Curt Hecht it be great for us to have a single standard to measure the brand President impact of online advertising—something that’s interchangeable Publicis Groupe’s VivaKi Nerve Center between all the media? Yes. I hope it happens in my lifetime.” (includes Digitas, Starcom MediaVest Group, ZenithOptimedia and Denuo) Media agency executives, who are tasked with much of the “I don’t think it would be a bad idea. It could be accomplished hands-on work that goes into measurement, were similarly through a research consortium or through agency networks. predisposed toward standards. Speaking passionately in favor of VivaKi and The Pool is an example. (The Pool is a group of online consistent standards for brand measurement was Cary Tilds of video suppliers such as Hulu and CBS and marketers that include Mindshare-Team Detroit. “Consistently measuring tactics for Allstate and Purina that are developing a replacement for the digital advertising for their branding effect provides the marketer standard preroll video ad unit.) There is an opportunity to share the most relevant information,” she said in an interview with insights and data with other companies. I think standards would eMarketer. “Random acts of measurement are OK, but they don’t help everybody in the industry.” Full Interview provide a consistent approach. If you are consistent, you can improve and evolve.” ® Online Brand Measurement: Special Report 38
  • 39. Working Toward the Solutions for Online Brand Measurement Jeff Lanctot In an interview with eMarketer, ANA CEO Bob Liodice underscored the need for marketers to look at the whole media pie when Chief Strategy Officer assessing online brand measurement. Said Mr. Liodice, “Our Razorfish, Microsoft Corp.-owned digital agency concern is about brand measurement in total, online or offline. The vehicle or approach to brand measurement is far less relevant “The market as a whole should start to narrow down the total than what it is we are trying to accomplish.” number of metrics. There are so many different things to He continued: “As we bundle and integrate marketing, rather than measure that it’s hard to say what the best metrics are. You run asking whether online, television, radio, print or outdoor the risk of having so much data that you can’t draw the story out advertising is working, we should ask, how the heck are all of of it.” Full Interview these things working together? It’s not effective to look at digital in isolation from the rest of the marketing mix.” Wenda Harris Millard President Many in the online ad industry, from all different vantage points, Media Link LLC, brand consulting firm feel strongly that measurement success will only come if the Immediate Past Chair–Interactive Internet adopts the very same metrics used by traditional media. Advertising Bureau “It’s not the industry that would create standards, it’s an independent research firm that would work with the IAB. It’s probably a couple of “The best thing would be to measure online years off. Nielsen is the likely one to get that going.” Full Interview branding the way we measure offline branding: awareness, reach, impact, recognition—coupled with response all the Integrate Online and Offline Measurement and Metrics Beyond developing uniform standards within the online ad way to purchase.” —Jim Sterne, founder of the measurement world, there is the larger issue of integrating eMetrics Marketing Optimization Summit and chairman of measurements across online and offline media. the Web Analytics Association, in response to an eMarketer poll fielded by InsightExpress, April 2009 In the previous section, we reviewed survey data from the 4A’s and ANA that showed clients and their agencies are not where they’d like to be in terms of integrating measurement data from their Embrace Traditional Media Metrics offline and online advertising efforts. In their related white paper, Having established that standards for online measurement would however, the 4A’s and ANA offered up some concrete advice for be helpful and that there is a growing need to integrate online and dealing with the integration issue, including these six tips: offline metrics, this raises a serious question: Would it make sense for the Internet to adopt the standard media planning and buying 1. Educate yourself. Become as educated as possible on digital metrics of the traditional world—namely reach, frequency and media; network with others who have paved the way by GRPs? There is a growing consensus in the industry that yes, it successfully incorporating digital into their campaigns. does make sense. 2. Set goals and objectives. Set clear goals and understand your business objectives upfront. “[We need] basic reach, frequency and GRP 3. Understand your consumer. Think about the consumers you forecasts for planning and post-campaign are trying to reach, and understand where they go online and analysis that have some semblance to what they do there. reality, [so there is an] ability to reconcile.” —Young-Bean Song, senior director of analytics and the 4. Be willing to test and learn. Understand that early pilots and “failures” can lead to big wins later. Reserve at least a small Atlas Institute for Microsoft Advertising, in an interview portion of your budget for experimentation. with eMarketer, April 16, 2009 5. Integrate your planning. Digital and traditional media must In the interviews eMarketer conducted with industry leaders for be planned together, not in silos. Do not regard digital as a this report, a strong majority conceded that it is now time for the separate “add-on.” Keep in mind that no media vehicle or Internet to embrace the GRP reach and frequency metrics long , marketing discipline succeeds on its own. used by television, radio and print advertisers. But there were also 6. Measure. Commit to metrics and analytics, and use them to make a few dissenters. your business case.Agree upfront on the definition of success. ® Online Brand Measurement: Special Report 39
  • 40. Working Toward the Solutions for Online Brand Measurement The resistance thus far to GRP adoption has been twofold. First, Many in the research field agree that GRPs should be adopted those pioneers who helped create the market for online for online. advertising—envisioning its limitless possibilities for interaction and “I think one would be crazy to not continue to use that [GRP] engagement—are loath to shackle it down with the old metrics of metric,” said Gian Fulgoni, chairman of comScore. “What it’s telling the past. Second, formulating and applying GRPs to the online space you is how many times you reached the person with an ad, and is just plain difficult. As David Smith of Mediasmith told eMarketer in how many people you’ve reached. I mean, if you don’t have that, I an interview, “The [GRP models for online advertising] already exist, don’t see how you can really understand the intricacies of your but most people just don’t understand the math.” media plan or compare it across media…. That’s the way media is But now the tide is turning and the pressure is on. GRPs are sold. We produce GRP measures directly analogous to TV today, making their way online. directly analogous to print, to radio.” Or, as John Burbank, CEO of Nielsen Online, put it in an interview “You will never see P&G and Unilever and with eMarketer: “Advertisers have to say, ‘I don’t care how many those guys spend more than single digits impressions I buy, I need to reach 10 million women age 18 to 24.’” [millions] online unless we give them reach, Mr. Hecht of VivaKi was also adamant that GRPs are necessary frequency and GRP numbers. Their business from an agency perspective. “Yes, I think reach is relevant,” he said models are based on media mix models in an interview with eMarketer. “The form in which you measure it where those are the inputs and outputs.” — isn’t as relevant. GRPs keep things simple. Going out and reaching Young-Bean Song, senior director of analytics and the Atlas a lot of people is relevant.” Institute for Microsoft Advertising, in an interview with Representing the online publisher’s side, Jim Spanfeller of eMarketer, April 16, 2009 and Ms. Horan of the OPA agreed that GRPs are needed online. Without doubt, the strongest proponent of GRP adoption was Mr. Song of the Atlas Institute (part of Microsoft). A pioneer in the field “In the offline world, GRPs are the metric,” said Mr. Spanfeller. “In of online measurement and analytics, Mr. Song argued that the online world, most of the major online spenders have come up adopting GRPs is “fundamental” to the Internet’s growth as an with their own methodology for online GRPs, but currently, there is advertising vehicle. no fully realized version of gross rating points for the Web. We should measure reach, we should measure frequency and the “[In the branding world], we don’t have a perfect view of ROI,” four basic brand metrics.” he explained. “So we revert back to something that we can all latch onto, something that makes apples-to-apples Ms. Horan noted, “Ultimately, I think [GRPs] is where we need to comparisons—fundamental metrics around reach and get to. We need a metric that will allow marketers to mix and frequency. So marketers ask, ‘Am I reaching my target audience match and to allocate dollars across whatever the platform is.” and am I doing that cost-effectively?’” Marketers also seem to be on board. As one brand marketer He added: “As soon as…we give advertisers the reach, frequency expressed it in the eMarketer/InsightExpress poll: “We need to be and GRP numbers they want, they’ll plug those into their able to model online along with other (traditional) media channels regression and media mix models and they’re going to say, ‘Wow, I in a standardized fashion to create reach and frequency. Digital should be spending 12% of my budget online.’” (Note: The current providers continue to resist this. We believe that until this is done industrywide allocation is just under 10%.) there won’t be the kind of scale online providers are looking for. This does not replace the other valuable and distinct Mr. Song continued, “Ten years from now we’re still going to be measurement options currently available; it simply provides the buying media on a CPM basis. These foundational metrics aren’t tools needed to plan at the brand level.” obsolete and you can reconcile them on the back end with ad- serving data. It’s something both publishers and advertisers can look at and agree on together.” ® Online Brand Measurement: Special Report 40
  • 41. Working Toward the Solutions for Online Brand Measurement Dissenting Opinions on the GRP Issue Also from the agency perspective,Yaakov Kimelfeld, vice president of Not everyone agrees with the GRP position. In an interview with digital research and analytics director at MediaVest USA, worried that eMarketer, senior marketer Ms. Fuller of MasterCard stated her GRP metrics overemphasize demographics at the expense of reasons for taking the opposing view. potentially more meaningful determinants such as attitudes and behavior. Mr. Kimelfeld wrote in an August 1, 2008, article in “I’m not looking for the same metrics,” such as GRPs, Ms. Fuller MediaPost,“Focusing on reach and frequency limits a digital explained. “We have different expectations…. We use digital campaign’s ability to serve ads based on specific audience media to tell more complicated stories and drive engagement. characteristics other than demographics, such as previous purchases The expectation for offline media is to deliver reach and and online behavior. In the end, these narrower criteria may be more frequency. I think they operate differently; I’m not looking for effective in predicting future purchase behavior than demographics.” identical metrics [online].” Finally, in an interview with eMarketer, Jim Dravillas, senior partner- From the research side, Mr. Gibs of Nielsen felt the GRP had lost its executive director of analytics at Neo@Ogilvy, posed a question for relevance in the highly fragmented media world in which we live. proponents of the GRP: “Why does the Internet have to model “The GRP metric is like a 50-year-old metric,” he said. “It’s very itself on traditional modes of measurement? The offline media has well-designed for when there was a world of three TV networks. to adapt to the digital environment. My end goal is not the GRP It’s less well-designed for a world where there are hundreds and itself, my end goal is the impact.” hundreds of TV networks and millions and millions of Websites.” However, Mr. Dravillas conceded that traditional metrics do have Instead of reverting back to traditional GRPs, Mr. Gibs argues that a place at the table. “The GRP is still very helpful from a planning the industry should seek to build a new type of currency model for standpoint, but not as a success measure. I want to try to reach Web measurement, one based on quality of data and as many of my target audience as I can in the most effective transparency: “Transparency means that the clients need to know way possible.” exactly what goes into it [the model] so they can trust the numbers that are being used for the buying [process].” How to Make the GRP Work for Online The GRP metric is basically a blunt measure for how many people Another problem cited about GRPs is that they are too limiting. A your advertising reaches, and at what level of frequency. marketer relying solely on reach and frequency would fail to capture the whole picture of exposure to online advertising, Mr. Song of the Atlas Institute said it best in his interview with particularly the potentially rich information that comes from online eMarketer: “The problem with the online impression—which is the searches, social sites, mobile activity or video streams. Speaking closest thing to a GRP right now—is that it doesn’t have a with eMarketer from the agency perspective, Mr. Lanctot of denominator. What I mean by that is, how many impressions did I Razorfish indicated that traditional media mix models, including deliver to the universe of women 18 to 45? That’s the the reliance on GRPs, are falling apart. denominator. The GRP is just the numerator. How many gross impressions did I deliver? [Online,] it’s hard to know what the “Looking beyond measurement within a specific media channel, the denominator is. It’s hard to know how many of those impressions media mix models begin to break when you include digital in the that you served actually went to women 18 to 45. This is an area mix,” said Mr. Lanctot. “Consumer behavior online and on mobile where the TV and print folks actually have an advantage.” devices is all over the place. Senior marketers are opening their eyes and saying, ‘OK, it’s time to forget everything that I knew.’” From a branding perspective, Mr. Song sees marketers knowing more about their audience in traditional media than they do He suggested that the solution lies with a hybrid approach, using online. “You actually know less in the online space with the same both panels and server-side data. He anticipates that the amount of data than you would in the offline space. You don’t aggregation and merging of different data sets will get us closer to know what the frequency is going to be. You don’t know what the truth and increase the trust advertisers have in the data results. percentage of the target audience you’re going to reach. The only thing you know that’s in common is the number of impressions.” In his interview with eMarketer, Mr. Song went on to say that Atlas and other groups, working in collaboration, are figuring out ways to measure the elusive denominator—the total universe of the target population. ® Online Brand Measurement: Special Report 41
  • 42. Working Toward the Solutions for Online Brand Measurement “We’re not the only ones working on this. It’s also Google, Yahoo!, “Marketers need to understand not only what works AOL and online networks that have large, registered user bases retrospectively, but how they can use data proactively to make and ad-serving technology to track everything on a census level better decisions about the audiences they buy and the way they and all the gross impressions. They will combine data sets to deliver messages,” said Konrad Feldman, CEO and co-founder of provide traditional advertisers reach, frequency and GRPs. As far Quantcast, in an interview with eMarketer. “When you have a as I’m concerned, that’s the foundation,” he explained. programmatic way of using that sort of insight across a broad range of media, you begin to break down barriers.” Taking another tack on the GRP front is Ms. Tilds, senior vice president at WPP’s agency Mindshare-Team Detroit. Based on the notion that online and offline measurement platforms need to “In the case where search has to compete for “talk” to each other, the agency has developed a new metric called a budget against other activities, it wins, as the iGRP or Internet gross rating point. This metric was built to , it generally delivers the most efficient allow for cross-platform measurement between television and returns. Only companies that do attribution online video buys. Said Ms. Tilds, “The iGRP’s purpose is to confirm modeling and look at media spends how to go about determining audience reach and holistically can allocate budgets frequency…planning against audience composition.” appropriately across search, display and She views the iGRP currently only used for online video, as merely a , other activities.” —Anonymous agency executive starting point in a long evolution: “The GRP is still very relevant. respondent from eMarketer/InsightExpress poll, April 2009 However, we need to evolve the GRP/iGRP as we evolve the media delivery and accountability across multiple screens and channels.” The absolute level of ad spending behind interactive has typically been too small to meet the thresholds required in large and Get Smart About Attribution Modeling complex media mix models. As Mr. Fulgoni said, “I don’t think Attribution modeling is all the rage in the marketing community. [media mix models] are sensitive enough to pick up the impact of Essentially, it seeks to attribute different quantitative weights to online. As time goes by and Internet spending continues to grow, the various consumer touchpoints in an advertising campaign, these models will become more relevant.” from banner ads and sponsorships to online video ads, brand Another challenge with attribution models is the sheer Website interactions and search activity. complexity introduced by digital variables in an already complex As such, attribution modeling is essentially an offshoot of the modeling system. media mix modeling that traditional advertisers have been doing for years. Media mix modeling helps advertisers determine which media inputs will have the most effective (and efficient) impact on “When models begin to approach the sales. They rely heavily on databases, which must be synced up to complexity of the reality they’re trying to provide a holistic view of results. explain, they become just as difficult to interpret—and insight is lost.” —James B. But attribution models need to go beyond the limited data-capture Ramsey, renowned mathematician and economics capabilities of today’s media mix models and capitalize on the unique professor at New York University; father of eMarketer CEO information provided by digital platforms, particularly data relating to Geoff Ramsey intent.As Mr. Kimelfeld, analytics director at MediaVest USA, explained on a phone call with eMarketer, the Internet offers up digital As Mr. Kimelfeld of MediaVest put it, the biggest challenge with footprints that can imply intent to act leading to purchase. attribution models is devising methods for “attributing consumer In his February 1, 2009, article in MediaPost, Mr. Kimelfeld brought intent manifestations to individual media platforms and campaigns.” up the example of consumers looking to purchase a car. He wrote, “The Internet [opens] up a world of searching, price comparison, consumer reviews and other user resources that have generated hard data proving that consumers are actively considering the advertised model—long before they start showing up at the dealership. Captured on a daily or even hourly basis, these events…point to the next level of the campaign effects hierarchy, a more advanced one than branding: They indicate consumers’ intent to act toward the purchase.” ® Online Brand Measurement: Special Report 42
  • 43. Working Toward the Solutions for Online Brand Measurement Exploring Solutions “If everyone used a transactions-based The bottom line: Mastering how to build effective attribution model, we would have a more accountable, models is going to come down to plain old hard work. defensible advertising model, which in turn “There’s a lot of heavy lifting to be done in terms of making the would create more stability and confidence appropriate attributions and setting up rules because too many in the interactive industry.” —Scott Knoll, general marketers are crediting the last click,” said Bryan Wiener, CEO of manager and vice president of display media, Datran 360i, in an interview with eMarketer. “The main complaint is that Media, in an article on iMedia Connection, May 5, 2009 the last click is getting a disproportionate amount of the credit, and the earlier paid clicks—from display advertising, e-mail and Scott Knoll, general manager and vice president of display media other things that contributed to the consumer reaching a at Datran Media, said the ultimate solution is to marry three sets of decision—are not getting appropriate credit.” consumer data into a single database that captures: Several key players in the online advertising ecosystem are rolling ■ Online activity across Websites, search, e-mail, video and mobile up their sleeves to develop and refine solutions for modeling, ■ Anonymous demographic information at the household level including the Atlas Institute (part of Microsoft), comScore and Nielsen Online. ■ Transactional behavior data that can provide definitive results for Mr. Gibs refers to Nielsen’s version of the concept as “media ROI-minded marketers allocation modeling,” which applies weights to “each creative or Mr. Knoll provided an example from one of his clients: “A national placement or whatever. And what’s important is then you can start tourism agency wanted to run a new advertising campaign and saying, ‘OK, so what’s the role of search?’ and you can layer needed direction on campaign targeting. Drawing on transactional search on top. You can say, ‘What’s the role of that microsite I and anonymous demographics data from a variety of sources, we built?’ OK, then you can layer the microsite on top. ‘What’s the role found that consumers who responded the best to the agency’s of video versus rich media versus standard display?’ OK, then you advertising were single couples, with no children, incomes in the can layer them on top.” $100k range, and between the ages of 26 and 45. Better data Ultimately, attribution models should be designed to tightly align means marketers can make business and creative suggestions data results to the marketer’s key objectives, which in many cases with new data insights. With this information, the agency was are some sort of sales activity. better armed to target their future campaigns to consumers who would be the most receptive.” Another example of successful attribution modeling comes from “Remember why you’re advertising. You are Chrysler and its ad agency, Organic, which designed a media not advertising for clicks or [gross rating modeling system that helped the automaker allocate its marketing points]. What you’re advertising for is to sell dollars more efficiently, including between digital and offline me stuff or change perception, and that’s media. A key insight making the model possible was the fact that what we need to be measuring against.” 70% to 80% of consumers typically research car purchases online. —Carrie Frolich, managing director, digital, Mediaedge:cia, as quoted in Advertising Age, May 18, 2009 “In refining the model, Organic learned how certain ads spur people to visit the Web,” reported The Wall Street Journal in May As an example, Nielsen, in a partnership with Yahoo!, is able to 2009. “It then figured out which Web activities translate into actual match online ad exposures to a panel of shoppers through its auto sales. Some actions, such as scheduling a test drive online or Homescan unit. Said Mr. Gibs, “If a person saw an ad and they entering a ZIP code to locate a dealer, are a good predictor of bought a product, it means the ad made them buy the product. So, sales…. The result was a system that predicted 2008 sales within it’s a fairly straightforward connection between the two.” one percentage point of actual sales figures for its Jeep brands.” Mr. Hecht of VivaKi has a slightly different view of the problem and, therefore, the solution. “The most broken part of Web [measurement] today is the attitudinal piece,” he said to Advertising Age on May 18, 2009. He believes “the killer app will be a sort of always-on brand-health meter” that he could dive into on a regular basis to gauge online ad effectiveness. ® Online Brand Measurement: Special Report 43
  • 44. Working Toward the Solutions for Online Brand Measurement Partnerships Are Proliferating Championing the View-Through Partnerships between multiple industry players are rapidly Another form of attribution modeling is the view-through emerging with the objective of amassing and statistically fusing conversion—a metric that captures what happens after the tons of data culled from numerous touchpoints. Such consumer is exposed to advertising, without the consumer collaborations are designed to get a holistic picture of consumers, necessarily clicking on any ads. Unlike immediate clicks, view- and the impact advertising has on their attitudes and behaviors, all throughs allow for the lag effects of time. the way down to the transactional level. Mr. Song of Atlas describes it as follows: “People [are] exposed to Panel-based measurement firms such as comScore, Nielsen, ads, don’t click on them, but actually end up on the advertiser’s Quantcast and Compete, for example, are all working on site to convert. We refer to them as view-through conversions…. multidisciplinary databases that can be mined to connect There are about 10 times the number of view-through conversions advertising exposure with behaviors such as search, site as there are click-through conversions. [But] the view-through visitation, video-viewing and, ultimately, purchases. conversions, as much as people want to add them to their ROI metrics, are not a measure of direct response. They’re a measure of whether you’re reaching the right audience.” “We don’t think there is one magical metric. You need to triangulate across several data Mr. Song continued, “I call it behavior-based target reach analysis. points.” —Stephen DiMarco, chief marketing officer, So instead of a reach analysis that’s based on demographics, it’s Compete, as quoted in Advertising Age, May 18, 2009 actually based on the behavior of people coming to your site, people who are turning into leads.” As another example, Datran Media, a digital marketing technology View-throughs are helpful because they account for the fact that company with a large database of e-mail and postal addresses, is branding takes place over time. Many advertisers attach zero able to append offline information through its collaboration with weight to view-throughs—often simply because they fail to numerous offline data sources, including Acxiom (household measure them. Others give view-throughs all the credit for data), IXI (financial data), MindSet Marketing Solutions (healthcare whatever results are seen. However, sophisticated tools are being data) and NextAction (retail data). This bundling of third-party developed to identify the ideal weight—between 0% and 100%— verified data, packaged under the product name Aperture, allows for any given campaign. marketers to better understand and measure the audience seeing and responding to their ads, whether those ads are banners, rich View-through measurements are offered by a number of players media units or video ads. in the market, including Google/DoubleClick, Microsoft/Atlas and comScore. In one study, comScore measured the impact of view- Similarly, Omniture and WPP’s Kantar Group are launching a joint throughs over time and found that they lifted the likelihood a effort that brings together data and analytics assembled from e- consumer would visit the advertiser’s Website. The average lift mail, search, display ads and traditional forms of media, creating a was highest (up 54%) in the two weeks after exposure; however, “multichannel view,” according to John Mellor, executive vice even after four weeks, the lift continued (up 45.7%). president at Omniture. Also involved in the partnership are Dynamic Logic and TNS Media Compete. Building New Measurement Models for Social and Finally, research powerhouse Nielsen is combining information Video Environments from its recently acquired IAG unit with its Homescan data to Advertising on social networks and certain video sites can provide evaluate the link between attitudes and sales. marketers with new and exciting opportunities to actually listen to consumers and find out how their brands and advertising campaigns are perceived in real time.While the measurement of these “It’s going to take a truly concerted effort on interactions is still in its early stages, there is a huge payoff for those the part of publishers and other willing to invest the time, energy and money to innovate. Moreover, intermediaries to create inventory that is the benefits go way beyond the confines of the social media platform. truly attractive to the creative community “I view listening as an important analytic,” said Mr. Mendenhall of and can be exploited effectively by the Hewlett-Packard. “As you employ listening and other analytics, creative community.” —Martin Nisenholtz, senior they start to drive your strategy at a macro-level. They either vice president for digital operations, The New York Times reinforce your strategy or correct it, and give you opportunities for Co., in an interview with eMarketer, April 2009 ideas, products, services, segments and/or geographies that you’re not even in.” ® Online Brand Measurement: Special Report 44
  • 45. Working Toward the Solutions for Online Brand Measurement Doug Weaver, founder and CEO of the Upstream Group, said social “With online video, there is time-based media media can be like a Richter scale for marketers wanting to gauge buying where time is one component of the the impact of their entire marketing efforts. mix. The advertiser is buying a person’s “For perhaps the first time ever, marketers can put a campaign or attention. I’ve seen very few standards on a message out into the public consciousness and then really hear what time means.” —Cary Tilds, senior vice and see its impact,” wrote Mr. Weaver in his May 2009 newsletter. president, Mindshare-Team Detroit, in an interview with “A brand can throw rocks into the pond and then measure both eMarketer, May 2009 the quantity and quality of the ripples that follow. By all means, pour your time, money and resources into this channel to really When it comes to measurement of social media and video, understand the full ROI of all your marketing activity.” advertisers are in the very early stages of connecting the dots. Such listening efforts conducted online can provide marketers with a sort of inexpensive “sounding board” for creative concepts they Q&A: What are the measurement challenges with might want to run offline. This can help advertisers save money by respect to online video? testing creative concepts online to see what works before investing Joe Laszlo in far more expensive television commercials or magazine ads. Director of Research Effective measurement of social media activities requires a new, Interactive Advertising Bureau, expanded mindset as well as a means to integrate data gathered trade association from all types of media. In an interview with eMarketer, social media guru at Nielsen Online Pete Blackshaw summed it up well: “There are a lot of different kinds of metrics being captured, “On one side, you’ve got paid media and on the other you’ve got analyzed and used to support the effectiveness of video earned media. Put consumer-generated media, social media and campaigns. I would hope that the industry starts to whittle down a lot of indirect marketing on the earned side, and paid media— the sheer number and decides that complete views are great, but offline and online—on the unearned side. The two kinds [can] midpoint views don’t necessarily give you a lot of useful data.” synergize [with] one another because paid advertising can help Full Interview stimulate the conversation. What we need is a measurement model that can look at the two—both in distinct buckets, but also Young-Bean Song as an ecosystem where one is feeding the other. Brand equity is Senior Director of Analytics & Atlas Institute heavily impacted by the way in which the two interact.” Microsoft Advertising, Microsoft Corp.’s digital Mr. Blackshaw concluded, “Brands need to figure out models for marketing and media solutions provider looking at all of this in totality. It would be the ultimate brand “The instinctual reaction of advertisers to try and show the sales dashboard that can look at ad measurements plus consumer impact of a video campaign is really misguided. We have studies perceptions through social media, and do it in real time.” showing that video, photo-sharing, weather and social media Just as standards are needed for measuring online advertising placements look horrible in the online ROI equation because they programs in general, many feel standards need to evolve for the social are upper-funnel. People don’t see ads on Facebook and then go world, as explained by Ms.Tilds of Mindshare-Team Detroit:“There is a buy something. But we are doing engagement mapping which is lack of standards on the data-mining aspects of social media. It hasn’t the ability to associate sales credit or ROI to all of the digital evolved because everyone wants to make their standard a touchpoints in a person’s history.” Full Interview competitive advantage, but that is the worst thing to do for the industry.There should be a call for a standard and an open dialogue.” Marketers are also excited about online video ads. Why? Because they can offer the sight, sound, motion and emotion of television ads, and provide better potential targeting and measurability. The digital nature of online video ads also means they can instantly be shared with others. For brand marketers looking to engage with consumers, online video ads provide a variety of metrics, including time spent. According to LiveRail, consumers watch, on average, more than 80% of a 30-second online video ad. ® Online Brand Measurement: Special Report 45
  • 46. Working Toward the Solutions for Online Brand Measurement Ken Mallon Those in the research field have their own ideas about what constitutes engagement. Nielsen, for example, is a big believer in Senior Vice President–Custom Solutions and Ad Effectiveness Consulting time spent as a measure of engagement and brand impact. Mr. Dynamic Logic, research company Gibs of Nielsen put it this way: “The single biggest problem is that specializing in marketing effectiveness the current measurement methodologies are insufficient to deal “Identifying scalable ways to track online video can be complicated with the complexities of online advertising. The solution we and there are special ways to track exposures. There’s also a believe quite strongly in is that measures of advertising online proliferation of different formats and then there are proprietary should be time-based measures, rather than impression-based players. Did people turn the sound on, did they stop the ad, did they measures. Instead of buying 100 million impressions on a Website, rewind or repeat it and if so, how many times?” Full Interview it would be buying X% of a person’s time.” Mr. Gibs went on to explain that time-based measures align Gian Fulgoni publisher incentives with advertiser goals. When time spent is the Chairman and Co-Founder metric advertisers are paying for, Web-based publishers will want comScore Inc., to create an engaging environment so visitors stick around and provider of online audience measurement and survey research interact with the advertising. “There’s a lot of experimentation going on as to ad placement and From the agency side, Cory Treffiletti of Catalyst:SF argues that format—be it preroll or postroll. I’m not sure anybody has figured time is not only a key measurement online, but that marketers it out or what counts as engagement with an online video ad. should be adding up all the pockets of time spent with the brand We’re running video ad tests looking at the impact on brand as a kind of overall engagement metric. As he said in his June 3, metrics and impact on sales.” Full Interview 2009, Online Spin column in MediaPost, “Time spent across the entire campaign is the only metric that truly covers all the bases.” Unraveling Consumer Engagement Metrics Others argue that time spent is insufficient. Although few in the industry can agree on a common definition of “engagement” in the context of online advertising measurement, “The key is to compare more than time spent, utilizing the clearly the Internet offers unique opportunities here given its interactive nature of the engagement unit,” wrote Joe Marchese, interactive nature. also for Online Spin, in April 2009. “Marketers should look to tie engagements directly to changes in brand perception, purchase Marketers, their agencies and a plethora of other industry intent and, in the end, purchase decisions.” stakeholders are working hard to develop engagement metrics that can act as proxies for attitudinal or behavioral changes they Mr. Wiener, CEO of 360i, likes the idea of a cost-per-engagement want to influence. metric, but he also advocates a restructuring of disciplines within marketing organizations and a concerted effort to stop conflating “We are in the process of trying to figure out the most effective direct response and branding measurements. way of attributing shifts in brand health to online activity,” said Ms. Fuller of MasterCard Worldwide, in an interview with eMarketer. “I believe that coming up with a cost-per-interaction or cost-per- “The easier part of the equation is measuring engagement. The engagement metric is an important component for a solution,” question is: How do you get more sophisticated about measuring said Mr. Wiener. “There is no panacea. One of the challenges is that the quality and impact of brand engagement?” people are looking for the Holy Grail.” Ms. Fuller added, “We look at time spent on our site and whether or not people engaged with the games we have there, how much traffic we’re able to drive and viral/social activities we are able to generate.” As Mr. Hecht of VivaKi said in an interview with eMarketer, “What we need to do is focus more on the outcomes and outputs of digital media. We’re focused more on brand engagement metrics that enable us to have better proxies for behavior and attitudes.” ® Online Brand Measurement: Special Report 46
  • 47. Working Toward the Solutions for Online Brand Measurement Next Steps: A Seven-Point Plan Q&A: What is the potential game-changer for online This final section summarizes the next steps for brand measurement? the industry in a short, seven-point action plan. Mark Addicks Once again, in keeping with the community Senior Vice President, Chief Marketing Officer nature of this report, the reader is encouraged to General Mills, consumer packaged goods marketer add comments and suggestions. “We’re looking for deeper analytics and to tie them all the way 1. Reorganize and Restructure Your Teams through to retail. In five, maybe 10 years, consumers will receive First, marketers need to restructure their organizations so that custom messages for specific retailers on their phone. They’ll online marketing reports directly to the CMO. This is the only way store their preferences and the information will go right into their that attribution and cross-platform models will be successful. loyalty card. They will choose where they want to shop and the offers will follow them there.” Full Interview Second, marketers and their ad agencies need to reorganize their internal teams and structures to concentrate on the branding Jon Gibs component of the online measurement process as a separate and Vice President–Media Analytics distinct process from direct response measurement. The Nielsen Co.’s Nielsen Online, provider of online audience measurement Bryan Wiener, CEO of 360i, put it well: “Digital is too often and analysis synonymous with direct response. CMOs need to look at their “Media allocation modeling, which analyzes all the elements in a marketing organizations and the way their agency roster is campaign that contributed to an action, sale or behavior and not organized. If they want digital to be an effective brand-building simply giving the last click all the credit. Marketers buying or medium, they need to reorganize their departments and have planning digital media on time-based measures rather than people who understand digital and agencies that understand impression-based measures.” Full Interview digital. Everything else follows from that.” Added Mr. Wiener, “There needs to be a clear separation and Bryan Wiener delineation between brand objectives/metrics and direct Chief Executive Officer response objectives/metrics. I think mixing the two, which we’ve 360i, all been guilty of, has created more confusion.” digital marketing agency To quote author Jim Collins, you also need get the right people on “I don’t think there’ll be a single game-changer. But I think the the bus. Specifically, you need two kinds of people: left-brainers most important thing is that chief marketing officers need to give and right-brainers. clear mandates and reorganize internally and externally around Left-brainers manage the terabytes of data, build complex models making digital a priority as a brand-building medium. There needs with databases that talk to each other, and then channel that data to be a clear delineation between brand objectives and metrics into actionable insights. Left-brainers are typically logical, and direct response objectives and metrics. I think everything else sequential, rational, analytical and objective. They look at parts. follows from that.” Right-brainers are the creative types who can craft advertising Konrad Feldman that strikes an emotional chord, changes attitudes and motivates Chief Executive Officer people to buy. Right-brainers are random, intuitive, holistic, Quantcast Corp., synthesizing and subjective. They look at wholes. online audience measurement service And finally, of course, you have to bring the left-brainers and right- “Marketers need to understand not only what works brainers together. As John Burbank, CEO of Nielsen Online, told retrospectively, but how they can use data proactively to make eMarketer, “There has to be a change in the way agencies are better decisions about the audiences they buy and the way they structured. Media buying, media planning and creative have to be deliver messages. When you have a programmatic way of using done cross-platform.” that sort of insight across a broad range of media, you begin to break down barriers.” ® Online Brand Measurement: Special Report 47
  • 48. Next Steps: A Seven-Point Plan 2. Partner 5. Become Educated Key stakeholders, including ad agencies, research houses, portals While models can provide insight, the models themselves need to and Web analytics firms, should strive to establish deep, broadly be shaped by insights that come from the real world—specifically, encompassing partnerships. The goal? To build up huge, through market research that will tell you what online consumers multiplatform databases that sync up demographic data, audience are doing and what they are likely to do in the future. By arming data, attitudinal data, behavioral data and transactional data. yourself with information and trend data, you will be able to ask the right questions and design measurement systems and models Focus on hybrid models that combine the best of panel that capitalize on real consumer behavior and attitudes. measurement and brand intercept platforms. 3. Build Cross-Media Coalitions “Data is useless unless it becomes currency The major media trade associations, including the IAB, ARF, 4A’s, for making a decision.” ANA, OPA and the WAA (Web Analytics Association) must step up —Rashid Tobaccowala, CEO, Denuo, as quoted in their efforts to align goals and committee efforts to develop MediaPost, June 10, 2009 common standards, definitions and best practices for measurement. A common currency is also a must. 6. Take a Long-Term View As such, the industry needs to develop standardized methods for Remember there is no silver bullet. Hard work and careful applying reach, frequency and GRPs to online platforms. planning will be necessary to reinvent online brand measurement (Importantly, the denominator in the GRP equation must be the and coordinate it seamlessly with offline measurement. There are total US population, or total target universe—not the population of no shortcuts to success. the medium.) The adoption of GRPs will be a starting point in providing 7. Make a Commitment marketers with apples-to-apples measurements that they can Wherever you are in the online marketing ecosystem, make a plug into their media mix models. commitment to improving online measurement for your brands, or those of your clients. While measurement is not the only thing Building on the GRP model as a foundation, the next step is to that needs fixing in the online advertising industry, it is a huge overlay the data that is unique to the online space and provides a obstacle to more ad dollars coming through the pipeline. digital footprint measuring how the consumer is engaged with the brand over a period of time. This could include time spent as well as a host of other engagement metrics. The goal is to move from media ad buckets and data silos to true integration—measuring across media. 4. Create Next-Generation Attribution Models Put a laserlike focus on building attribution models to identify and quantify the value of every media touchpoint along the purchase funnel. Tie that data into holistic models that can help marketers make future decisions about media allocations, both within the online universe and across all media platforms. Among other skill sets, this will require a mastery of Web analytics. Additionally, the models need to incorporate social media and video activity. Marketers must make it a priority to systematically monitor social media interactions and use this valuable “listening/learning” to inform their online and offline media and creative messages. One of the biggest challenges will be to measure the sharing activity among social consumers, including online video ads and widgets, which can affect a marketer’s reach and engagement levels. Those who are able to connect all the dots will enjoy a significant competitive advantage. ® Online Brand Measurement: Special Report 48
  • 49. Endnotes Endnote numbers correspond to the unique US Online Advertising Spending Growth, by Format and Objective, 2008-2013 (% change) six-digit identifier in the lower left-hand corner 2008 2009 2010 2011 2012 2013 of each chart. The charts from the report are Video 126.5% 43.5% 42.5% 40.5% 48.6% 30.6% repeated before their respective endnotes. Rich media -0.8% 3.0% 9.4% 12.4% 13.5% 12.0% Sponsorships -39.2% -17.7% 9.4% 10.8% 13.5% 10.4% Display ads 9.4% -4.6% 3.6% 4.4% 7.8% 2.2% 102197 | 104363 | 104366 Branding total 8.0% 1.0% 10.4% 12.7% 18.2% 12.4% E-mail -4.5% -3.2% 2.6% 7.1% 9.6% 10.4% US Online Advertising Spending Growth, 2007-2013 (% Search 19.8% 13.4% 13.2% 10.6% 11.2% 10.2% change) Lead generation 6.3% 4.8% 9.4% 10.8% 11.9% 8.8% 2007 25.6% Classifieds -4.4% -15.9% -9.7% 5.9% 10.8% 5.1% 2008 10.6% Direct response total 11.8% 6.2% 8.9% 9.9% 11.2% 9.4% Grand total 10.6% 4.5% 9.4% 10.8% 13.5% 10.4% 2009 4.5% Source: eMarketer, April 2009 2010 9.4% 104366 2011 10.8% Extended Note: eMarketer benchmarks its US online advertising 2012 13.5% spending projections against the Interactive Advertising Bureau 2013 10.4% (IAB)/PricewaterhouseCoopers (PwC) data, for which the last full Source: eMarketer, April 2009 year measured was 2008. Online ad data includes categories as 102197 defined by IAB/PwC benchmark—display ads (such as banners), search ads (including paid listings, contextual text links and paid US Online Advertising Spending, by Format and Objective, 2008- 2013 (millions) inclusion), rich media, video (including in-stream, in-banner, in- 2008 2009 2010 2011 2012 2013 text), classified ads, sponsorships, lead generation (referrals) and Display ads $4,877 $4,655 $4,824 $5,034 $5,426 $5,543 e-mail (embedded ads only); excludes mobile ad spending. Video $734 $1,054 $1,501 $2,109 $3,134 $4,092 Rich media $1,642 $1,691 $1,849 $2,079 $2,359 $2,641 Sponsorships $387 $319 $348 $386 $438 $484 Branding total $7,640 $7,718 $8,522 $9,608 $11,357 $12,760 Search $10,546 $11,956 $13,534 $14,969 $16,648 $18,340 Classifieds $3,174 $2,671 $2,412 $2,554 $2,831 $2,976 Lead generation $1,683 $1,764 $1,930 $2,138 $2,393 $2,604 E-mail $405 $392 $402 $431 $472 $521 Direct response $15,808 $16,783 $18,278 $20,092 $22,343 $24,440 total Grand total $23,448 $24,500 $26,800 $29,700 $33,700 $37,200 Note: numbers may not add up to total due to rounding Source: eMarketer, April 2009 104363 102197 104363 104366 ® Online Brand Measurement: Special Report 49
  • 50. Endnotes 104394 Extended Note: Barclays includes auctions, display, lead generation/e-mail, search and other. BMO Capital includes Comparative Estimates: US Online Advertising classifieds, display ads, e-mail, lead generation, rich media and Spending Growth, 2009 (% change*) video, search, slotting fees, sponsorships and other. Borrell LiveRail, September 2008 includes standard display ads such as banners and pop-ups, 19.4% streaming audio/video, paid search and direct/e-mail. Citi JupiterResearch, December 2008 Investment Research includes banner ads, classifieds, digital 14.8% video, e-mail, lead generation, rich media, search and BMO Capital Markets, October 2008 13.0% sponsorships. Collins Stewart includes banner ads, classifieds, e-mail, referrals/lead generation, rich media/video, search and Wachovia, October 2008 10.0% sponsorships. eMarketer benchmarks its US online advertising spending projections against the Interactive Advertising Bureau ZenithOptimedia, April 2009 7.4% (IAB)/PricewaterhouseCoopers (PwC) data, for which the last full Borrell Associates Inc., November 2008 year measured was 2008. eMarketer includes categories as 7.2% defined by IAB/PwC benchmark—classifieds, display ads (such as SNL Kagan, May 2009 banners), e-mail (embedded ads only), lead generation (referrals), 6.2% rich media, search ads (including paid listings, contextual text links Collins Stewart LLC, May 2009 and paid inclusion), sponsorships and video (including in-stream, 5.0% in-banner, in-text)—and excludes mobile ad spending. GroupM, March 2009 JupiterResearch includes classifieds, display and search. Myers 5.0% includes display, online video/social networks/widgets, search eMarketer, April 2009 and other. ThinkPanmure includes banner ads, classified ads, 4.5% e-mail (embedded ads only), lead generation, rich media, search Citi Investment Research, January 2009 (paid and contextual), sponsorships and video. ZenithOptimedia 4.3% also includes Internet radio and podcasting. ThinkPanmure LLC, October 2008 3.0% 104597 | 104600 Barclays Capital, May 2009 2.3% US Online Display and Search Advertising Spending Growth, 2008-2013 (% change) Morgan Stanley, March 2009 2008 2009 2010 2011 2012 2013 2.1% Search* 19.8% 13.4% 13.2% 10.6% 11.2% 10.2% Thomas Weisel Partners, March 2009 Display ads** 9.4% -4.6% 3.6% 4.4% 7.8% 2.2% 1.5% Note: *paid listings, contextual text links and paid inclusion; **banner ads Jefferies & Company, February 2009 only, excludes rich media and video 1.0% Source: eMarketer, April 2009 104597 Credit Suisse, February 2009 0.1% US Online Display and Search Advertising Spending Myers Publishing LLC, May 2009 Share, 2008-2013 (% of total) -0.5% 2008 2009 2010 2011 2012 2013 Oppenheimer & Co. Inc., February 2009 Search* 45.0% 48.8% 50.5% 50.4% 49.4% 49.3% -2.0% Display ads** 20.8% 19.0% 18.0% 17.0% 16.1% 14.9% UBS, February 2009 Note: *paid listings, contextual text links and paid inclusion; **banner ads only, excludes rich media and video -5.0% Source: eMarketer, April 2009 Cowen and Co., May 2009 104600 -6.0% 104597 104600 Note: *vs. prior year Extended Note: eMarketer benchmarks its US online advertising Source: eMarketer, April 2009; various, as noted, 2008 & 2009 spending projections against the Interactive Advertising Bureau 104394 (IAB)/PricewaterhouseCoopers (PwC) data, for which the last full 104394 year measured was 2008. ® Online Brand Measurement: Special Report 50
  • 51. Endnotes 104573 projections against the Interactive Advertising Bureau (IAB)/PricewaterhouseCoopers (PwC) data, for which the last full Comparative Estimates: US Online Display and Search year measured was 2008. In its search figures, eMarketer includes Advertising Spending Growth, 2009 (% change*) paid listings (paid search), contextual text links and paid inclusion. Online Search display Barclays Capital, May 2009 -1.0% 10.0% 103522 BMO Capital Markets, October 2008 -2.0% 21.0% Citi Investment Research, November 2008 -5.0% 14.0% Online Advertising's Effect on Brand Metrics in the US, Q4 2008* (% of respondents impacted) Collins Stewart, November 2008 3.0% 13.0% Aided Online ad Message Brand Purchase Cowen and Company, May 2009 - 1.0% brand awareness association favorability intent Credit Suisse, January 2009 -5.9% 8.1% awareness eMarketer, April 2009 -4.6% 13.4% Control 72% 25% 17% 42% 39% Forrester Research, April 2009 1.7% 13.9% Exposed 74% 30% 19% 44% 40% JPMorgan, January 2009 6.3% 9.9% Delta** 2.4 4.9 2.6 1.6 1.3 Myers Publishing LLC, May 2009 -3.0% 1.0% Note: n=2,380 campaigns and 3,889,602 respondents; *includes three years through Q4 2008; **delta defined as point difference in exposed vs. Oppenheimer & Co., February 2009 -15.0% 10.0% control groups SNL Kagan, May 2009 4.6% 9.1% Source: Dynamic Logic provided to eMarketer, April 27, 2009 103522 ThinkPanmure, October 2008 -5.0% 13.0% 103522 ZenithOptimedia, April 2009 -1.8% 9.0% Extended Note: This chart shows the % impacted as a result of Note: *vs. prior year Source: eMarketer, April 2009; various, as noted, 2008 & 2009 exposure to the online ad campaign. For example, on average, 104573 2.4% of people (or 24 out of 1,000) exposed to online ads become 104573 aware of the tested brand. Citation: Barclays Capital, "Internet Data Book May 2009," provided to eMarketer, May 14, 2009; BMO Capital Markets, 103523 "Internet Media & Broadcasting," provided to eMarketer, October 30, 2008; Citi Investment Research, "US Advertising: Batten Down Online Advertising's Effect on Brand Metrics in the the Hatches," provided to eMarketer, November 10, 2008; Collins US, by Level of Campaign Performance*, Q4 2008** (% of respondents impacted) Stewart LLC, "Global Internet," November 24, 2008; Cowen and Aided Online ad Message Brand Purchase Company, "Internet & New Media," provided to eMarketer, May 22, brand awareness association favorability intent awareness 2009; Credit Suisse, "US Advertising Outlook 2009," provided to Top 8.9% 14.0% 9.5% 7.5% 7.1% eMarketer, January 9, 2009; Forrester Research, "US Interactive Average 2.4% 4.9% 2.6% 1.6% 1.3% Advertising Forecast" as cited by Inside the Marketers Studio, April Bottom -2.3% -1.6% -2.0% -3.5% -4.0% 23, 2009 with eMarketer calculations; JPMorgan and company Note: n=2,380 campaigns and 3,889,602 respondents; *best performers reports, "Online Advertising Forecast," provided to eMarketer, are the average of the top 20% of campaigns per metric and worst November 3, 2008; JPMorgan and company reports, "Nothing But performers are the bottom 20% of campaigns; **includes three years through Q4 2008 Net," January 5, 2009; Myers Publishing LLC, "Advertising & Source: Dynamic Logic provided to eMarketer, April 27, 2009 Marketing Investment Forecast 2008-2010," May 4, 2009; 103523 103523 Oppenheimer & Co. Inc., "Media & Internet," provided to Extended Note: Read chart as saying that on average, online eMarketer, February 24, 2009; SNL Kagan, "Economics of Internet campaigns in the top 20% of performers impact 7.1% of people Media," provided to eMarketer, May 21, 2009; ThinkPanmure LLC, with respect to purchase intent. "Internet Advertising," October 8, 2008 provided to eMarketer, October 22, 2008; ZenithOptimedia, "Advertising Expenditure Forecasts - March 2009," provided to eMarketer, April 14, 2009 Extended Note: Barclays includes display, rich media and video. BMO Capital, Citi Investment, Collins Stewart, eMarketer, Oppenheimer and ZenithOptimedia include banners only. Credit Suisse includes banners, rich media and video. JPMorgan includes display. Myers includes banners, rich media and other. ThinkPanmure includes display, rich media, listings and other. eMarketer benchmarks its US online advertising spending ® Online Brand Measurement: Special Report 51
  • 52. Endnotes Related Information and Links 102827 360i Interactive* Advertising's Effect on Brand Metrics in the US, by Site Category, January 2009 vs. August 2008 Aberdeen Group (% change in delta**) Aided Online Message Brand Purchase brand ad assoc- favor- intent aware- aware- iation ability Acxiom ness ness Branded content sites 63% 7% 8% 40% 0% (OPA members) AdMedia Partners MarketNorms® database -11% -8% -10% -18% -13% Portals -9% -3% -6% -11% 0% Ad networks -21% -7% 0% -18% -40% AdRelevance Note: *involves the audience without having them click through or leave the Webpage; **delta defined as point difference in exposed vs. control groups Source: Online Publishers Association (OPA) and Dynamic Logic, "Improving Advertising Age Ad Performance Online: The Impact of Advertising on Quality Content Sites," January 8, 2009 102827 Advertising Research Foundation (ARF) 102827 Extended Note: Branded content sites–respondents with campaigns running for the past three years through Q3 2008. Adweek MarketNorms® database–respondents with campaigns running for the past three years through Q2 2008. Alterian American Association of Advertising Agencies (4A’s) Association of National Advertisers (ANA) Atlas Institute BMO Capital Markets Catalyst:SF CMO Council Compete comScore Cowen and Co. Credit Suisse ® Online Brand Measurement: Special Report 52
  • 53. Related Information and Links Crossix Solutions Kantar Group Datran Media Lenskold Group DoubleClick LiveRail dunnhumby Lotame Solutions Dynamic Logic Marketing Executives Networking Group (MENG) Eyeblaster MarketingProfs Forbes MarketingSherpa Forrester Research MarketSphere General Mills MasterCard Worldwide Heidrick & Struggles McKinsey & Co. Hewlett-Packard Media Link LLC ICON International MediaPost iMedia Connection Mediasmith InsightExpress Microsoft Advertising Interactive Advertising Bureau (IAB) Millward Brown iProspect MindSet Marketing Solutions IXI Mindshare-Team Detroit Jefferies & Co. Myers Publishing Johnson & Johnson MySpace ® Online Brand Measurement: Special Report 53
  • 54. Related Information and Links Neo@Ogilvy Specific Media NextAction Spencer Stuart Nielsen Homescan Starcom MediaVest Group Nielsen Online The New York Times Co. OfficeMax The Nielsen Co. Omniture TNS Media Intelligence Online Publishers Association (OPA) Universal McCann Oppenheimer & Co. Upstream Group Organic Verse Group Penn, Schoen & Berland Associates VivaKi Nerve Center PricewaterhouseCoopers (PwC) Web Analytics Association (WAA) Primary Impact WPP Group Procter & Gamble Yahoo! PROMO magazine PubMatic Quantcast Razorfish Rubicon Project Sapient ® Online Brand Measurement: Special Report 54
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