Wednesday, May 23, 2012 by Bryan
Statistics are one of the many marvelous tools used in digital advertising, allowing for the unprecedented ability to measure exactly how many people were reached by an ad in a way that led them to take action. This has been especially true of click-through rates (CTRs), the primary digital ad measurement tool that tracks how many web users actually click on different ads. Knowing what ads are being clicked and by whom unlocks a vast array of premier search and social media marketing opportunities across a wide range of custom channels.
Compare the availability of CTR information to a billboard on the side of a highway or even a million dollar ad run during the NBA finals. You can gather statistics about how many cars drive down that highway each day, but it’s nearly impossible to know how exactly many drivers and passengers actually notice the ad in a meaningful way. Similarly, stats about how many folks watched the NBA finals are readily available, but estimates about how many watchers stuck around during the commercial break instead of heading to the fridge will always be a rough estimate at best.
But while CTRs have become a standard part of digital marketing, it’s becoming increasingly clear that clicks are a flawed, unreliable metric, and that the traditional benefits of catchy, visually stimulating ads (more common to print advertising) shouldn’t be abandoned altogether.
“Your ad being seen matters more than your ad being clicked–if you have a back-end conversion metric,” said Pretarget Founder Keith Pieper. “After all, what good is an ad that can’t be seen? It’s intuitive that an ad must be seen to make an impact, and it’s even more intuitive than someone hovering and engaging with an ad might convert, even absent a click.”
To gauge the success of a digital ad campaign, online advertisers should put more focus on the visibility of digital and how much time web users spend “hovering” over an ad instead of measuring clicks.
The Pretarget and comScore study looked at more than 263 million impressions for 18 different advertisers across a range of industries and tracked what types more often led to actual conversions (defined in the study as either purchases or requests for information). New statistics-gathering mechanisms allowed them to track how viewable ads are and how much time web users spend looking at them.
As expected, high viewability and high “hover rates” correlated more specifically to conversion rates than did click through rates–by wide margins. Hover received a 0.49 correlation factor and viewable impressions a 0.35 score. The correlation of clicks to conversions was just .01.