Darren Morton, sales director, VIC & SA, Quantcast
The fractured system of incentives and measurement in digital advertising has long been known, the unknown is finding the solution to solve for this.
Management consultant, Peter Drucker’s, famous saying, “What gets measured, gets managed”, is typically mentioned in relation to performance outcomes in business. However, this is of course what marketers reach for to not only ensure that they have achieved a return, on their now even harder to come by marketing budgets, but also showing their organisations that their marketing efforts are in fact worth the investment and deliver business outcomes.
Digital marketing has been consumed with chasing vanity metrics (like clicks - CTR) for some time which is well documented, however the ability to measure outcomes in a meaningful way has never been more important. Meaningful measurement should show the outcomes that businesses need to focus on to deliver the right results that really help the brand to grow and continually improve.
When I speak to marketers, the three key reasons I hear behind measurement focus on: budget justification, budget allocation and continual improvement. Each of these have a different rationale and audience and require a cohort of reporting metrics to justify success. Where we play at Quantcast is around helping brands better understand campaign performance so that they can continually iterate activity to deliver better results time and time again. This is the measurement that marketers control, and for this reason I will focus on measurement for the purpose of continual improvement.
Where to start when it comes to measurement
The complexities across the digital marketing landscape are vast, measurement is no different so it’s sometimes difficult to know where to start. ‘Good measurement’ involves weighing up the pros and cons of the different approaches and metrics available, the likelihood is that you will need a cohort of metrics to deliver meaningful results that continue to inform your marketing strategy and tactics to drive continual improvement.
To close the gap on measurement, we need to simplify the models that we use, not just because it’s easier to understand at each point in the decision making chain, but it also allows us to better understand the weaknesses of the model and continually use this as a feedback loop to test and learn to consistently develop a method of continuous improvement to our online marketing tactics.
The importance of continual improvement
It’s important that when we think about metrics that support continual improvement, we think about this cycle:
Measurement here needs to tell you two things:
1. Did I execute my plan well?
2. Is it impacting anything?
These are the two things that really matter when it comes to measurement for the purpose of continual improvement.
Your overarching filters: context and common sense
It is important as digital marketers that we think about measurement not simply by measuring what we can, but what is of value, and in this context is highly important to achieve the outcomes we desire. There are a number of challenges when we look at digital metrics, and you can hear all about the pros and cons to these in Quantcast’s recent webinar Chasing the Holy Grail of Digital Measurement.
When it comes to performance campaign measures of success, we usually see metrics such as clicks, conversions and sales. While clicks are easy to measure and build a retargeting pool, we all know that clickers are not all converters and are open to bots and fraud.
This is why hygiene metrics are important because they help you manage your risk versus goals. While they show an ad’s viewability, they do not show customer engagement so cannot be used in isolation.
Are you reaching valuable new audiences?
Whilst attribution is an important part of the way we measure a campaign’s success, the ability to deliver incrementality, particularly in a market like Australia, is possibly a more pressing one.
A common challenge that I hear when talking to brand marketers revolves around incrementality and duplication in reaching audiences online. The challenges we see with big brands that already reach and are known by a large percentage of Australian consumers (for big brands this could be +50% awareness) is two pronged.
Brief: Our advertising must reach a set percentage of the Australian population.
● Challenge 1) Purely basing brand campaigns on reach often means that these brands are targeting audiences that already know their brand.
● Challenge 2) If we dive deeper into the targeting, we can often see that of those that know of the brand, whether they are advertised to or not, they will purchase anyway.
Whilst these brands may be achieving the measurement metric of ‘reach’, dollars are being wasted marketing to those that a) are already aware of the brand and their offerings and b) will buy anyway. The missing piece of the puzzle centres around helping brands find new incremental audiences and helping marketers understand how digital can be used to find and engage with them.
For brands with high market saturation and awareness, finding new audiences can be quite complex, but these complexities are worth exploring if brands are looking to drive a significant increase in their market share. There are share points to be won for those that can successfully leverage partners and channels that can identify incremental audiences and drive gains across reach, share, and ultimately revenue.
We define incrementality testing as measuring how a specific marketing event was causally influenced by a media channel or tactic, in this case display, over a set time period and budget. There are a number of challenges when it comes to incrementality, but there are also solutions.
Solving challenges around duplication
Finally, the topic of duplication, particularly in the online world, is something we hear a lot from marketers and agencies and is rightfully a discussion worth having to ensure that marketers’ advertising dollars are being used in the most effective way possible. Conversations on the topic in the digital space tend to revolve around: “Am I buying the same cookie twice?”,
“What solution solves this across multiple media channels?”, and “How do we come to an effective cost per acquisition (CPA) that is true to the client’s needs?”. Challenge your partners with these questions to better understand how you can be more effective with your media spend and reaching and engaging with the highest value audiences.
When considering the optimal acquisition cost, marketers should start internally and build their own benchmarks to reference success rather than aggregate industry averages. Whilst industry benchmarks are useful, setting your own goals, campaign benchmarks, and historical measurement points will ultimately provide a better representation of success and help to guide better decision making.
Will we ever find the holy grail of measurement?
Don’t get me wrong, measurement is hard to achieve, but the importance has never been so desired, not only by marketers and agencies alike, but by the chain of decision makers from CMO to CFO and CEO. There unfortunately isn’t a one size fits all approach to measurement, but in setting clear objectives and measuring using a cohort of metrics you can consistently learn from the continual feedback loop and evolve your measurement strategy accordingly.