This article below appeared in Advertising Age last week. In it, Eric Porres, CMO of marketing technology company Lotame, discusses a study they carried out to measure online brand impact based on factors other than only click-through rates. There were some insightful and quite surprising conclusions but as far as we are concerned, it underlines an important point that we keep making: CTR is only one part of the value chain.
The Click-Through That May Be Hurting Your Brand - What If the Click Isn't Just Irrelevant, but Also a Negative Indicator for Success?
We all know the way our industry seized on click-through rates because it's so easy to measure. And we've long heard the arguments that a high CTR doesn't matter. What if that's not quite right, though? What if a high CTR matters -- but inversely? What if a high CTR is actually a negative indicator for your brand?
Quite often, it is, according to a recent study conducted by Lotame. Not only do click-through rates fail to measure what marketers are really looking for, they're often negatively related to brand lift.
In the study that Eric describes above, Lotame found that although there is a strong positive correlation between click-through rates and both interaction rates and brand favorability, there was far less of a positive correlation between CTR and purchase intent. What was more, there was a negative correlation between CTR and important brand metrics such as ad recall. Eric Porres concludes that by focusing a campaign solely on CTR there is a high possibility that there will be a negative impact on valuable brand measures. Campaigns should not only be concerned with driving clicks – there are other things that need to be taken into account.
Our CEO, Peles, also had some thoughts on the Lotame study, and while he was in complete agreement with the conclusions reached, he felt that campaigns considerations had to be taken even further: “Whatever the desired results of a campaign,” he said, “CTR is only one part of the value chain. When running a campaign one must look at every step of the process from the first spark of a creative idea to the final analysis of conversion data."
Peles then added that the smart advertiser / marketer needs to look not only at the impact on the metrics considered by Lotame, but, and most importantly, they need to be concerned with the results they are getting from the campaign compared with what they are putting in. In other words, they need to ask, “Are the results a good return on investment?” To be sure that their answer to this question is a positive one, they need to be sure that every link in the value chain is being optimized. This ultimately is the chief concern of DMG and is realized so comprehensively by the optimization platform Traffiliate.
