Customers, Click-Through and Conversion

If you’re going to convert folks who click through to your site from an ad,
you’ll likely get 60 percent of your response in the first half-hour.

According to the latest Online Advertising Report from AdKnowledge, the Internet is increasingly becoming a quick turn-around medium which makes it ideal for direct-response campaigns.

“It confirms that the Web is very interactive and a very active advertising
medium,” said Steve Findley, vice president of analytics at AdKnowledge, a
division of CMGI‘s Engage Inc.

But, wait, there’s more. In last quarter’s AOR, the company found that there
were more people who converted after viewing an ad and not clicking, than
there were people who converted after clicking on an ad. Post-impression
conversions accounted for 32 percent of total conversions, while post-click
conversions counted for only 24 percent of the total. That finding seems to
support the view of the Internet as a branding medium.

Clearly, the Internet is both a dessert topping and a floor wax. But what
does that mean for online advertisers and marketers?

Basically, it says that the interaction between the advertisement and the
consumer are much more complicated than measurements like click-through can
tell you. And it says we’ve got to dig deeper to really see what’s going on.

When you’re concerned about ROI (and when aren’t you?), another set of
numbers become significant. Of total conversions, 44 percent were repeat
conversions — customers who bought before, after either seeing an ad, or
clicking on an ad. So customers that bought before are the most likely to
buy again. It would seem to be a no-brainer, and it shows that the recent
growth of the customer relationship management focus is right on track.

Other interesting data from the OAR:

  • Advertising folks seem to be getting better at driving conversions,
    rather than just click-through, with their creative. Last year, the creative
    with the highest click-through rates also yielded the highest conversion
    rate in only 14.3 percent of campaigns. This year, that number has climbed
    to 36 percent of campaigns. Another possible conclusion: marketers are
    getting better at designing Web sites that work well with good creative.
  • In a confirmation of conventional wisdom, keyword placements were found
    to yield the highest click-through of any other types. But they also cost
    more. On portals, run-of-site or run-of-network buys evoked a response just
    43 percent as great as the keyword deals. On non-portal sites, these
    run-of-site or run-of-network buys compared more favorably to keyword buys.
    So, on non-portal sites, run-of-site or run-of-network may actually make the
    most economic sense.
  • Average CPM (rate card) rates actually rose slightly during the second
    quarter, growing from $33.59 to $34.06. But that puts them nearly equal with
    the rate at this time last year. Meanwhile, the number of sites and networks
    seeking advertising grew 13 percent in the second quarter, with the highest
    growth rate among news and media sites.

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