Measuring the effectiveness of online advertising
Summary
- The web analytics tools provided by search engines serve as a key online marketing tool for advertisers. Analyzing the data revealed by Google Analytics or Yahoo Web Analytics helps website owners to fine-tune their sites more reliably and thereby improve sales.
- Google Analytics supplies key performance indicators, which help to improve websites' performance. Google Analytics is used to track sales and conversions. It helps to measure site engagement goals against the threshold levels that the advertiser defines.
- Yahoo Web Analytics is a website analytics system designed to help website businesses increase sales, reduce marketing costs, and gain insights about online customers, while Bing provides several forms of analysis through its Atlas Advanced Analytics.
- AOL, which markets its offerings to advertisers under the brand “Advertising.com”, offers an optimization technology to evaluate real-time data to maximize performance. It offers both pre-sale and post-sale insights.
- E-commerce sales serve as a useful metric for measuring online advertising in addition to these analytics. E-commerce sales in the US are expected to reach $249bn in 2014, increasing from $155bn in 2009. However, while $155bn worth of consumer goods were bought online in 2009, a larger portion of offline sales were influenced by online research: $917bn retail sales were “web-influenced” sales. The growing volume of online sales clearly demonstrates the importance of online advertising.
Web analytics
The
web analytics tools provided by search engines serve as a key online marketing
tool for advertisers. Analyzing the data revealed by Google Analytics or Yahoo
Web Analytics helps website owners to fine-tune their sites more efficiently
and thereby improve sales.
Web
analytics have become websites' data warehouses, providing broad and
non-strategic analytics. The adoption of key metrics can help to reduce the
time and costs of finding relevant information about a website's performance.
Web
analytics not only analyzes the number of visitors visiting a website; but also
analyzes the quality of the traffic and what the visitors did after they
entered the site. Analytics shows what type of visitors are on the site, where
they came from, how they arrived at the website, what they did on the visit,
and whether the organizations' objectives have been met.
Google Analytics
Google
Analytics supplies key performance indicators that help to improve websites
performance. Google Analytics is used to track sales and conversions. It helps
to measure site engagement goals against the threshold levels that the
advertiser defines. It uses tools such as dashboards, advanced segmentation,
custom reports, data export and so on to measure advertising returns on
investment in terms of the amount of traffic generated.
Google
Analytics provides cross-channel and multimedia tracking and benchmarking
metrics measuring how the site performs against other players in the industry.
It helps clients to visualize data with tools such as motion charts,
geo-targeting, funnels and score cards. It also provides several apps for
analytics.
Yahoo Web Analytics
Yahoo
Web Analytics is a website analytics system designed to help website businesses
increase sales, reduce marketing costs, and gain insights into online
customers. Its main features are:
- Dashboards – It helps clients to view key performance metrics within customizable executive dashboards. The user can customize his dashboard with key performance indicators, time periods, benchmarks, goals and charts through which he can track his web business. The system also allows the creation and editing of dashboard widgets.
- Real-time information – It helps the user to see data within moments of the website visit. It displays individual click paths, time spent, actions taken, and other information about particular visits.
- Visitor demographic reports – The demographic reports and dashboard provide an aggregated snapshot of the age groups, gender, and age-gender cross-tabulations of customers from each of the traffic channels. Demographic information can be used to create more targeted campaigns, or to find high-performing audiences in new channels.
- Visitor behavioral reports – These reports reveal the interest categories of customers based upon the types of websites they visit. They can be purchased from Yahoo and other networks.
- Visitor click path analysis – This helps to track visitor click-paths through multi-step conversion processes and troubleshoot popular paths to increase task completions. It also drills down on branches of the tree structure to follow all the paths from or to that page.
Pre-configured
conversion funnels and ad hoc scenarios –
In addition to viewing predefined conversion funnels, a user can create new
sales funnels on the fly and apply them to historical data.
Besides
this, Yahoo analytics supports other features such as custom reports, advanced
data visualization, advanced cost per click (CPC) campaign management, and so
on.
Bing analytics
Bing
provides the following forms of analysis through its Atlas Advanced Analytics:
- Creative optimization advisor – Optimizes the best creative ad for placements;
- Advanced reach and frequency reporting – Generates granular frequency reports at the site, placement, and creative levels;
- Optimal frequency analysis – Pinpoints the frequency that delivers the highest conversion rate to help target the most profitable frequency;
- Time-to-convert analysis – Examines different conversion windows (time lag between the last click or impression and the conversion) to measure the impact on the reported conversion results;
- Daypart analysis – Measures how impression delivery, clicks, and conversion rates fluctuate throughout the day to help targeting efforts;
- Geographic performance analysis – Helps to determine which regions receive the highest click-through rates and conversions, and compares online impact with offline marketing efforts;
- Campaign builder – Identifies overlap across channels, sites and placements in order to analyze sites in terms of reach versus frequency, pinpoints time-to-convert periods, and views overlap between channels (e.g. search and display campaigns);
- Search and display synergy – Measures how display ads are boosting the success of search campaigns;
- Keyword path – Identifies search behavior patterns to understand issues such as which keywords drive prospective buyers into the advertiser’s websites, which keywords are clicked most often in combination with others, and which paths are driving converters;
- Rich media conversion reporting – Helps determine the contribution of rich media events like expansions and interactions to conversions, and related statistics that help benchmark and calculate returns on investment for rich media campaigns;
- Engagement mapping factors reporting – Engagement mapping allows advertisers to map and assign value to the various touch-points a consumer is exposed to, showing a more complete picture of a campaign and giving publishers credit in those areas where they performed better. It places different weight on the different experiences that consumers have with a brand, including the frequency, order, size, and type of creative service.
AOL analytics
AOL,
which markets its offerings to advertisers under the brand Advertising.com,
offers an optimization technology to evaluate real-time data with the aim of
maximizing performance. It offers pre-sale insights to improve the potential
campaign’s performance before it starts. It also offers post-campaign reports
to help an advertiser understand how audiences responded so that he can use
that information for his next campaign. For its AOL properties websites, Google
handles the performance metrics.
Pre-sale
- Monopoly cards – Monopoly cards identify a particular consumer segment on the site, such as travelers. The advertiser can then see how people in this segment compare to the site's other visitors such as doctors or lawyers and whether they visit other sites, including competitors'. This can help to improve targeting.
- Bubble charts – Bubble charts not only identify behavioral segments but also let the advertiser knows how likely these segments are to engage with his site, and how many of them were able to reach them through any comScore-recommended site.
- Visitor interest reports – These reports help the advertiser learn about his site's visitors' interests. This is done with the help of a cookie placed on each visitor’s website. AOL tracks the users to understand where they went and what they did after they left its sites. This gives a better sense of the users' preferences.
Post-sale
- 2x2 reports – These numbers compare a specific campaign's performance with audience behaviors, letting the user see who clicked and how many times. For instance, it helps an advertiser to know if travelers delivered 50% of the clicks, or if health seekers did not visit his site at all, and so on. Such results are useful for future campaigns.
- Segmentation lift tool – This lets a user know how his campaign performed against a wide variety of standard segments (e.g. age, gender, behaviors) as well as applicable custom segments (e.g. pixels) across both AOL properties and the Advertising.com network. Performance is measured by three criteria: views, clicks, and conversions.
E-commerce as a key performance indicator
E-commerce
sales serve as another useful metric for measuring the effectiveness of online
advertising. Global e-commerce revenues increased from $183bn in 2004 to $501bn
in 2009. The sluggish growth during the period 2008–09 can be attributed to the
economic slow-down and its consequences. However, growing at a CAGR of 20.2%
between 2009-12, global e-commerce revenue is projected to increase to $870bn.
The drivers for this growth include:
- Increasing e-commerce penetration in Western Europe;
- Broadening variety;
- Improvement in shipping infrastructure;
- Improved payment systems;
- Better fraud protection;
- The continuous increase in size of the global middle class.
