Hitmetrix - User behavior analytics & recording

The Value of Branding in Online Ads

When advertisers evaluate media spending, their main concern is return on investment. Online advertising is particularly measurable in this regard because immediate responses to an ad can be measured directly from the click to the purchase.

But online advertising also is responsible for driving additional purchases through the branding value of the ad impression itself, and this effect often goes unmeasured. Many online advertisers do not or cannot track the consumer who views an ad but does not respond immediately, yet later buys the product. This type of purchase, often called a “view-based conversion” or “view-through,” now can be quantified.

We know the view-through effect exists. The question is to what extent it drives sales. Lacking a definitive answer, marketers focus on click-through rates and click-based conversions to evaluate the return on their online advertising dollar.

If view-based conversions could be quantified easily, they could provide media companies with additional revenue opportunities and give marketers another source of data for analyzing and justifying payout of possible advertising programs. However, marketers usually launch integrated campaigns using several media vehicles, making accurate measurement of the view-based effect difficult.

But what if a marketer launched a product offering by using only a single online ad vehicle? Clearly, it would let the advertiser understand the effect of both the creative and the ad vehicle on awareness and purchase intent. More importantly, by isolating the ad vehicle, the advertiser could accurately quantify the view-based effect of an ad. It would even provide data to help understand the value of advertising over time.

That’s what Entersect Corp. did in the first quarter of 2003 with its new Locate America product. It advertised exclusively with The Gator Corp.’s GAIN Network for the launch of the product. Since the product was new and never had been advertised before, all sales could be attributed directly to the ad campaign.

Locate America is a new online background search product that launched in January. At that time, with no advertising or promotion of any kind, it had no consumer awareness, no established price point and no advertising effectiveness track record. With the start of Locate America, Entersect needed several questions answered, including whether online behavioral marketing can generate sales efficiently.

Entersect chose Gator as its first media partner because of its ability to target online users by behavior. Users of Gator products have granted permission for Gator to display targeted advertising to them based on their online surfing habits, so advertisers can reach users who display a specific behavior at any time. In Entersect’s case, the target group was users who viewed other online background search sites.

Entersect ran various creative executions through the GAIN Network, using pop-unders that displayed the actual Locate America Web page as well as GAIN Sliders (ads that “slide” out from the lower corner of a user’s browser window). The ads offered users a preliminary search, which prompted them to search for a name in Locate America’s vast databases. These preliminary searches would return the person’s name, location and age. If users wanted more information on the person, they could then buy a more detailed report.

The GAIN campaigns recorded significant view-through numbers. More than half of the Locate America completed sales that came as the result of ads displayed during the test period were view-based sales. In a 45-day window from the day the campaign deployed, more sales resulted from view-through conversions than from those who initially clicked and responded to the ad. (See chart.)

Furthermore, the view-through traffic was better qualified, as it was 54 percent more likely to result in a completed sale than traffic resulting from ad clicks. From Entersect’s standpoint, tracking view-through data let it see that its campaign generated more than twice the number of sales it might have otherwise thought, had the company tracked only sales resulting from ad clicks.

This test definitively shows that less than half the value of the online advertising campaign came from ad clicks. Once prospects are exposed to the ad message, they may return later, based on their awareness of the product offering.

“I was surprised at how clearly we were able to isolate the branding effect of the campaign,” said Andy Aranyi, president and chief marketing officer at Entersect. “The Gator program has really helped us optimize our ad spending by helping us optimize our ad spending by helping us quantify the real return of our online advertising.”

Online advertising can have a significant branding effect, even when the ads aren’t clicked. As evidenced by the overall view-through percentage of 1.38 percent, interested consumers do notice advertised brands and visit their Web sites later, at their own convenience. Sales based on clicks are only a fraction of the picture of online advertising’s effectiveness. The branding effect of properly targeted advertising can drive as many sales as the direct response attributes that prompt immediate action.

It is important to complete the picture by tracking view-through data and pooling this information with click-through data. Advertisers who track view-through data often find that their highest-clicking ad isn’t their best-converting ad. Click-through rate tells only part of the story.

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