Commentary
Why Clicks Will Always Matter
- by Ari Rosenberg , Op-Ed Contributor, September 6, 2012
Clicks will always matter -- and when premium publishers tell clients and buyers they don’t, these publishers make the very problem they are trying to solve even worse.
Before I get to how this is true, let’s look through some common-sense lenses at the reasons why less than 1% of users click on ads -- and yet 99% of clients care about their campaign’s click-through rate.
1. If you ignore the “rate of clicking” and focus on the raw sample size, the number is most often in the thousands. Tough to find one client that doesn’t feel better upon hearing thousands of people visited their site.
2. If you paid for online ads from your own pocket, you would care about clicks -- no way you wouldn’t.
3. Have you ever contributed a comment to a group conversation on Facebook, and then later learned someone clicked that they liked your comment? How did that make you feel? That’s how clients feel when users click on their ads.
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4. Premium publishers that are telling clients that clicks have no value are talking to advertisers that collectively spend billions of dollars a year paying for clicks in search.
5. Clicks will always matter, because the most effective form of display targeting -- which advertisers are purchasing in droves, through networks and exchanges -- is “retargeting.”
Once users hit the home page of an advertiser’s site, pixels placed on every page of their site deposit cookies. These advertisers then scour the exchanges buying impressions to reach “their users” while on other sites, as identified by this cookie data. So now Target.com, for example, knows what ad to send to someone who went to their site’s home page, and which ad to serve to those who visited the kids section.
Clicks from other forms of display advertising that deliver a user to an advertiser’s site, increase the size of this conversion pool clients are successfully swimming in.
I so get why premium publishers want and deserve more credit for the intrinsic branding value they bring to the table. Disposing of clicks as a value proposition makes a clearer statement why an advertiser should run on a premium publisher’s site, and “get your performance elsewhere -- we deliver branding.”
The first mistake in this narrative is making this an either-or scenario instead of packaging clicks as an incremental benefit. Branding plus performance increases a premium publisher’s value in the online display landscape. Branding or nothing induces a choice that doesn’t include publishers.
The second error in this disposal of click value will prove to be fatal for publishers in the wake of a perfect (shit) storm. That’s because buyers are nodding their heads in agreement that clicks don’t matter -- but for the exact opposite reason why publishers are saying it. Premium publishers see disposing of clicks as a way to shed ROI accountability, while buyers see it as a way to hold publishers more accountable for conversions.
Without clicks, buyers will continue to shift their evaluative focus from how many potential customers a publisher dropped off at the front door of a client’s restaurant, to how much these people ordered and paid for food that publishers did not prepare, cook or serve. All of a sudden, clicks don’t taste so bad, do they?
Premium publishers are losing their footing in the land of online display advertising, and dismissing clicks as incremental value is like climbing into their own ditch. I’m not so sure they’re getting out alive.
I don't think anyone is saying clicks don't matter. I think what they're saying is, given that only about 8% of Internet users click on any ads at all in a given month, and that demographically it's a downscale 8%, that it would be foolish-- and the certain death of premium publishers, and of Internet advertising as a viable competitor to TV advertising-- to evaluate ad performance on the basis of a behavior that, a priori, the overwhelming majority of your target audience may reasonably be expected not to exhibit.
I guess it's a good thing TV advertising doesn't include clicks ;-) Certainly a vibrant PPC ecosystem exists where clicks are both a measure and the billing metric, particularly in search. One of the challenges with non-clickers is that even if view-throughs are valid and occurring (more often measured for display than search) marketers spend a lot of time customizing the landing pages for the clickers in both search and display. The homepage (which gets any viewthroughs) serves a far more generic purpose. The lading pages may be used for branding or DR messaging and can be more robust than even most rich-media ads, but obviously if you can't get the click that message is wasted. I guess that at least in search even those who prefer not to interact with display media will continue clicking.
Premium Publisher's want to deliver value to their clients in all forms (probably far more so than spammy made-for-adsense sites do).
Premium publishers believe clicks and conversions matter, what strongly they disagree with is the implication that impressions (and quality of audience) DON'T matter. Because they do.
Advertisers know that impressions matter, and they know audience quality (reaching the right prospects) is critical - if they didn't believe this, they would not buy premium sites.
Every time a client wants to dismiss the value of the impression and buy a premium site on a CPC basis, I have this conversation:
Me: "So you are saying there is absolutely zero value in the impression?"
Client: "Yes, the only thing we care about is the click"
Me: "OK, let me work with you on that then. We both know that non-branded advertising performs significantly better than branded advertising (on CTR), so give me non-branded ads, and we'll run those on a CPC basis"
Client: "Well.... we want to run our branded ads, we just want to pay for them on a CPC".
.... you get the point....
If buyers and sellers work together, in a transparent and above board fashion, I don't think there is a publisher on the planet who doesn't want to help their client obtain their objectives. That's what we're all in this business for... but pricing models should not a negotiation tactic. The team needs to focus on what the goal is, and deliver the pricing model, and execution methods, that best achieve that goal.
It's the same reason CPA is difficult. If the publisher has no control over the advertising, the conversion process/funnel, the pricing, etc... it's hard to hold them accountable for the sale. But is the advertiser and publisher work together on ALL of those things and have flexibility, a true mutually beneficial partnership can evolve.
I'll run your CPA program if you run mine. I'm selling "Pet Rocks" for $100 each and paying out a whopping $90 bounty! You in? Probably not.
@ Joshua
You might find this recent paper we wrote interesting in this context: "Measuring the Value of Users who Click on Online Display Ads"
http://www.criteo.com/sites/default/files/success_stories/documents/criteo_research_paper_1-en.pdf
We saw that, when you show users a properly targeted and well-executed Ad, then almost half of heavy online shoppers end up clicking on such an Ad at some point. Far from being a "Downscale" population - clickers are actually the most attractive online audience, and buy 3x more than non-clickers.
Does this mean that there is no value beyond the click? Certainly not. But just, at least for performance advertisers, the click is the strongest signal the Ad is a good Ad. If your Ad has a CTR of 0.1%, then there is probably something wrong with the targeting or creative.
I read this recently:
http://www.comscore.com/Press_Events/Press_Releases/2012/4/For_Display_Ads_Being_Seen_Matters_More_than_Being_Clicked
This is just one example of the wide number of different ways you can evaluate performance. Advertisers will always be looking for that perfect metric which will tell them exactly how much something costs and how much it is worth.
It is most important, rather, to consider what works best for you, in your situation. At the end of the day, if your aim is to get users to make a purchase through your site, if you get millions of clicks but no sales - is that effective? If your aim is to spread the news about a new movie release, then a huge number of clicks could be beneficial.
All a click tells you is that the ad was good enough to get someone to click it. Then you need to ask how that fits in to your overall marketing mix.