Several leading Web publishers are seeking to convince advertisers that online advertising is measured best via impression and post-impression action — claiming that the heavy reliance on click-through rates have given the industry a black eye.
MarketWatch.com became one of the first major publishers to say it would no longer report click-throughs to clients. Instead, MarketWatch.com (in which both CBS and Pearson PLC, which publishes the Financial Times, hold an ownership stake) said it will provide reports detailing post-impression activity.
The effort, said MarketWatch executives, is aimed at persuading the advertising industry to view online ads as tools for branding rather than direct marketing.
“Click-through rates are a misleading statistic — they aren’t indicative of raised awareness or of consumer interest,” said Scot McLernon, who is executive vice president for ad sales at MarketWatch.com. “Too many Web advertisers and potential advertisers have been misled by this metric.”
Clearly, the effort is touchy — some advertisers are very likely to expect click-through reports, and MarketWatch.com said it would still provide the figures if explicitly requested. But another industry group, the Online Publishers Association, hailed MarketWatch.com’s effort as an “important step in refocusing the industry on a new vision of how to measure success.”
“It is critical that we move beyond this very narrow metric,” said a statement from the group, which is headed by acting executive director Michael Zimbalist, formerly of ePod. “Click-through rates fail to account for the branding and behavioral effects that are achieved online, particularly within quality editorial environments where consumers spend a significant amount of time. As a result, the ROI for online ad campaigns has been highly undervalued.”
“It is incumbent upon us to demonstrate that consumers experience long-term attitudinal and behavioral changes through repeated exposure to marketing messages within online media,” said the group, which includes MarketWatch, New York Times Digital and ESPN.com, among others.
The stance is especially gutsy, since it seeks to undo a state of affairs largely brought about by the industry itself. During the medium’s infancy, proponents of online advertising touted the banner ad’s ability to make a targeted sales pitch: viewers would receive ads suited to their needs and tastes, and would click to make a purchase or get more information.
But now that the number of online ads has grown tremendously, click-through rates have tumbled to somewhere near half a percent. And that’s a state of affairs that the industry is trying to remedy with a sweeping slate of recent initiatives.
Earlier this year, the industry’s leading association of media sellers, the Interactive Advertising Bureau, rolled out a host of new ad units, designed to supplement the banner ad with larger and more noticeable ad formats — which would foster more compelling creative than banner ads, and hopefully, greater user interaction.
MarketWatch.com, a member of both the OPA and IAB, has been especially willing to experiment with tweaks to its sales approach — not only adopting the IAB’s larger ad sizes but also being one of the first publishers to sell day parts.
“There is no doubt that web advertising works — it’s the measurement method that has come up short these past few years,” said McLernon. “As a media channel, the Web can measure reach and frequency with more accountability than any other medium, and awareness and lift can be measured using traditional pre- and post-campaign research.”
But more change may be needed. Earlier this year, IAB vice chairman Richy Glassberg (a founder of now largely defunct ad rep firm Phase2Media) decried the Web publishing industry’s lack of full-disclosure audited traffic measurement, like the Audit Bureau of Circulations for magazines. Additionally, Glassberg called for ad sellers to provide statistics on the medium’s branding capacity.
But promising news abounds as well. In addition to efforts like those of MarketWatch and its supporters, there’s also a growing body of industry-friendly research that speaks to the branding power of Web ads.
Jupiter Media Metrix, for one, said last month that its studies show that Internet advertising is both measurable (using survey methods) and considerably undervalued by media planners. And last week, Coca-Cola Co. said it’s seen results from its online advertising campaigns to suggest that banners do have a branding value.