The optimization of an organization’s varied processes enhances its lifespan and ability to survive - especially during harsh times such as the recession we are still recovering from. In fact, it's hard to think of any organizational process that would not benefit from optimization: from saving money on office supplies to maximizing the efficiency of internal systems. 

In the digital advertising world, optimization is being used to improve processes, to enhance the effectiveness of online-advertising campaigns and to increase the margin between the benefit of the campaign and its cost. In most cases the goal is finding a balance between this margin and the quantity (volume) achieved. More often than not the cost is calculated as the price of (effectively) obtaining a client, whereas the benefit is calculated as the income obtained from the same client (net, after selling costs).   

For the most part the goal is maximizing results. This means finding a balance between the desired margin and the volume achieved. It is usually the case, at least in online advertising, that we are willing to give up on some of the return in exchange for a greater volume. As an advertiser, we are willing to pay more to obtain a client if it results in us ultimately converting more customers. A volume discount does not usually work in our industry.

When managing a digital campaign, in order to get results, you must manage the process. Here, as mentioned before, in order to achieve a balance between a satisfactory margin and the desired volume, one has to manage the value chain of the campaign, with the understanding that each component in the chain not only influences the final outcome but also has an effect on every other link in the chain. For example, a creative concept with a high click-through rate will usually lead to a lower conversion rate.  The value chain is combined of and has effect as follows:

·         Promotional offer - directly affects the ability to convert customers while inversely impacting on their value.

·         Creative concept - directly affects the click-through rate while inversely impacting on the conversion rate. 

·         Media - directly affects the click-through rate while inversely impacting on the conversion rate. 

·         Landing - directly influences the conversion rate while inversely impacting on the value of the customers. 

Optimizing the whole value chain requires finding the correct combination of the different components so as to bring about the desired results.

The idea is to try different ingredients and different combinations (multivariate testing). This means trying different marketing proposals, supported by an alternative creative concept, diverse media, appropriate landing pages and varied conversion funnels. 

The optimization process never ends, there are countless possibilities and always a better path to take, and its goals can and should change relative to the goals of the  business and the desire to achieve the initial objectives of the campaign.

Such optimization cannot be done without appropriate technology but technology alone is not enough. Skilled teams are required by both the advertiser and the media company. Both must be willing to work hard together to achieve the campaign goals - work which includes amongst other factors both parties sharing information in a transparent manner.

Why do advertisers place a strong emphasis on optimizing pre-click elements such as creative, media, placement and so on, yet tend to ignore post-click optimization, although it is the most crucial stage where the actual conversion is taking place?

At DMG we strongly believe that Post-Click Optimization is a crucial part of any online advertising campaign’s value chain. This is why we developed the unique technology which makes Traffiliate possible – a powerful landing page and conversion funnel optimization platform.
Based on a machine learning optimization engine, Traffialite automatically serves the most conversionable landing page to each user profile, optimizing campaigns’ conversion and results.

Here is a little slide that demonstrates the importance of the value chain, and how Traffiliate can help you, the advertiser, increase online conversation rates by 30% to 200% while enjoying the best value for your money:
Beyond Post Click by DMG - DSNR Media Group

The term “Online Advertising” is often replaced with “interactive advertising”, in most cases this is the better term as it is more comprehensive and also implies the potential benefits from this advertising vehicle:

Interactive à Interaction:

1. That allows Targeting based on user action.
2. That also calls for interaction / action.
3. That is measurable, accurately.

This interaction based advertising implies accountability and measurability and hence interactive advertising has the potential to solve one of the oldest advertising dilemmas:

Which half of my advertising budget is a waste? Or as exactly cited from John Wannamaker (1838-1922), the father of modern advertising: “I know that half my advertising budget is wasted, but I have never been able to discover which half”.

Let’s dive into all aspects of interactivity:

1. Targeting – each user / computer surfing the internet has its own, unique characteristics that should be used for targeting – at the simplest level, from what geographic region and in what language this user surfs. Up to more sophisticated behavioral targeting and alike. So allowing user based targeting, matching the right message to the right audience almost on a 1to1 level.
2. Interaction – online advertising is usually based on some sort of user action / engagement, immediate reaction to a call for action. This interactivity allows the advertiser, to know, relatively fast and after investing only limited budget, if they are on the right track to success.
3. Accountability – and hence makes interactive advertising the most accountable mean of advertising. As one of the comments I live by says: “the best thing about internet advertising is that it is accountable!”

If you are not capitalizing on all three you are missing, follow these simple steps and you will not miss: 

1.  
   • Set goals – what are you trying to achieve, who are you targeting and what sort of action are you trying to generate. (Targeting)
   • For how much – set KPI’s for impressions, clicks and conversions, how many for how much will eventually lead you to your goal. (Interactive)
   • Measure – your campaign performance against your goals and KPIs (accountability)
   • Optimize – make changes on the fly to get closer to your goals – you should see change in trend and optimization results in almost no time! 

Optimize all aspects of the value chain; make sure your KPIs are touching upon all of them:

• Promotional offer and message
• Media sources / placements
• Creative
• Landing pages and conversion funnels
• And post conversion values

This result based approach requires holistic view of the interactive advertising value chain. Not only each aspect needs to be optimized by itself, but also their interoperability needs to be taken into account. For example: Achieving higher ctr on the creative level usualy implies lower conversion rate on the landiong page.

Once mastered, this approach ensures reduction in the half that doesn’t work In paraphrase on John Wannamaker – Interactive advertising is basically focusing on the half that works!

How to capitalize on international opportunities while minimizing risks?
by co-CEO, Tsafrir Peles

With 15% to 30% of all visits to US websites originating from abroad, Internet use growing exponentially in developing markets, and expat communities fast becoming important niche audiences --- astute advertisers and publishers have an opportunity to exploit this unleashed, global potential - both from the buy-side and the sell-side. But will one catchall strategy for the international market work?  

Not really. Localization is the key. And, success in the global marketplace requires an in-depth understanding of localization that goes beyond language and linguistic nuances. It includes cultural differences, local regulations, currencies, and payment methods … and these are only the tip of a very large iceberg that involves myriad subtle distinctions and unfamiliar parameters that can make or break an international advertising campaign. The greatest challenge for advertisers is that almost everything they have learned about their home markets - what works, what doesn’t, and why; how to approach the target audience; what to offer them; how to design the call to action –-- all of this hard-won knowledge is, for the most part, irrelevant in other regions of the world. Moreover, a new layer of optimization is required which will impact on all the existing parameters … and will, therefore, influence the entire course of the campaign. Without properly building and implementing this critical layer, it is all too easy to miss those lucrative opportunities. 

Click ‘Aqui’ or Click ‘Here’
Message translations must utilize relevant jargon and appropriate buzz words - and be fine-tuned to language nuances and cultural preferences - in order to deliver a spot-on message that generates the sought-after response. Similarly, when selecting a prize, advertisers had better be sure that the specific model actually works in the target country! The complexities inherent in targeting an international audience require a lot more than just reaching them with translated messages. Local regulations – as well as creative and technical requirements of local service providers - must be taken into account. It’s not enough to prepare a great landing page that presents savvy marketing content and format; if it doesn’t comply with the technical guidelines of the local infrastructure or service provider, it may not even open when potential customers click on it! 

Additional optimization layer for the value chain
In order to successfully lead local audiences to the desired action - smart, subtle and sophisticated optimization is required across all campaign parameters, guided every step of the way by the mantra, “Different strokes for different folks!” From promotional offer to messaging, placement, creative, and conversion funnels - a perfect blend must be created that will maximize bottom-line results.  For example, an incentivized Lead Generation campaign is running in Germany, France, and the UK. Which prize will work best? This is, in fact, quite a complex issue. Since products have varying value and emotional associations from country to country, correct selection demands extensive knowledge of local attitudes. In the UK, for example, an Audi might be considered the perfect draw; in France, cars can also work well, but almost any car will do; in Germany, however, an iPhone would be a stronger incentive, since winning a car sweepstakes is considered unrealistic - and would therefore not attract the audience. Rule of thumb: the selection of the promotional offer should always be region-based; in some countries, a particular product will generate high ROI, while in others, the same offer may not work at all. The above example is a relatively simple one. Just imagine the complexities involved when dealing with multiple markets that are distant and diverse - geographically, linguistically and demographically. Not less important than the prize is the selection of media and placement, a task that involves much more than locating publishers to run specific campaigns. In some regions, it is crucial to run a campaign only on "safe" websites that are seen as respectable and reliable. And, in certain parts of the world, color plays a significant role, often equal to seemingly more critical issues. Advertisers must also carefully consider their sales approach. Should a hard sell or a more sophisticated tactic be implemented?  

Integrated Results-Based Approach to Online Advertising

A version in German:Results that Measure Up DE.DOC (63.50 kb)    

 Don’t you wish someone could put a realistic price tag on finding new leads or customers?

While we are preparing a wish list… Wouldn’t you like to get a better handle on ROI, or knowing how much revenue in certain market segments can be attributed to the campaign? Or even better yet, how would you like to be able to analyze price sensitivity in different market segments based on online information while the campaign is going on?

Integrated results-based approach is about squeezing every possible benefit from every dollar spent – quickly and intelligently. In order to optimize advertising campaigns and achieve ambitious ROI goals, advertisers must have access to real-time feedback, measurement and instant analysis of all their online marketing activities.

Define the road to meaningful results

This approach is based on the fundamental understanding and definition of the real value that a customer, lead or click represents. That means setting a realistic “price tag” on the desired result, or conversion, whatever it may be – a new lead, customer, sale, click, or registration. At the same time, we must bear in mind that this price tag varies across geographical regions, market segments, media types and even promotional offers.

Measure to optimize the process

The focus is on measurement and understanding that everything is, and should be, measured. The optimization process is based completely on the measurable results received from across all the different advertising platforms, on the different processes that make up the conversion value chain – starting with clicks, leads, registrations and even offline upgrades and up sell opportunities. This way, every advertising dollar is optimized intelligently. So before, during and, of course, after the campaign, advertisers have a real handle on the value of every conversion and know how much revenue in specific market segments can be attributed to the campaign. Armed with that, ROI objectives are clearly in sight.

Real added- value comes with integration

Results-based online advertising is only as good as the breadth of the online tools available, and how they are leveraged together. Data is combined from all advertising platforms: SEM, Banner ads and emails to shorten the learning curve and build value faster. Knowledge gained from any one platform is immediately made available to ongoing campaigns on other platforms and rapidly optimized to guarantee continuously improved results.

The final frontier: integration with CRM

With full integration with existing CRM system, the campaign comes full circle to become a sophisticated marketing tool that enables targeting market segments, such as discounts to first-time buyers, as well as opening a plethora of cross-sell opportunities. The result: total control of the sales cycle – from the very first impression all the way to the desired conversion. Control that is always focused on positive ROI.

For advertisers as well, In response to an article by Abbey Klaassen published on Ad age digital February 23.

http://adage.com/digital/article?article_id=134787 

Click is wrong metric for advertiser optimization as well, as CTR is the easiest metric to manipulate. As a media buyer I’ve always stayed away from cpc metric when buying display.

When eCPA is what matters from the advertiser perspective and eCPM is what the publisher is after, manipulating CTR is, in many cases, the way to bridge the gap. When locked in a fixed CPC this tool is taken away and hence at least one will lose (advertiser, or publisher).

An article in the wsj from the 5th of february.

http://online.wsj.com/article/SB123379182761749823.html#articleTabs%3Darticle

The ‘performance-driven advertising’ is yet another, a bit nicer (maybe), name for what internet advertising is and should be all about:

Measurability and accountability – which are the core merits.

Eventually, sometimes you need to go through tough times in order to inherit concepts that should have been inherited already -  like this one.

Treating internet advertising, as TV or news paper advertising is just missing on one of the net's biggest advantages measurability and accountability.

I am sure we will all get out of these times stronger and smarter about our businesses - especially if these businesses are online.

In response to "Global Budgets to Boost Online Advertising" 

An article posted in November on mediapost:

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=93914 

I commented on this article when it was published, and now approaching the half of Q1 2009 - i find it, not only still relevant, but also actually happening.

International growth in general, is what companies need to be looking for now days. In our industry, CPM 's are falling and opportunities are rising...

Here is the original comment: 

This article demonstrates one of the good things that come out from these bad times: looking for extra monetization.

When big U.S. advertisers are cutting budgets and are looking to get their campaigns better targeted, publishers will increase their efforts to better serve their American clients, and on the other hand, better monetize the leftovers.

In the last 4-5 years, we have also been pursuing this slice of the pie, and built a successful business on the 30%-40% non-U.S. visitors on U.S. properties.

Most of the time we find it very difficult to convince Americans that there is a world out there, that, among other things, visits U.S. Web sites such as yahoo.com and alike

We have been very busy with summarizing 2008 that is not done yet, but has been an amazing run for us here in DMG.
Now planing for 2009, great things to come, a lot more of the same but some news as well.
Stay tuned we are going to make 2009 even more exciting than 2008 has already been.

Peles

Commentary by Peles on :

Global Budgets To Boost Online Advertising (OMD, 11/3)

”This article demonstrates one of the good things that comes out from these bad times: looking for extra monetization.

When big U.S. advertisers are cutting budgets and are looking to get their campaigns better targeted, publishers will increase their efforts to better serve their American clients, and on the other hand, better monetize the leftovers.

In the last 4-5 years, we have also been pursuing this slice of the pie, and built a successful business on the 30%-40% non-U.S. visitors on U.S. properties.

Most of the time we find it very difficult to convince Americans that there is a world out there, that, among other things, visits U.S. Web sites such as yahoo.com and alike”.

Media Post letters-to-the-editor 14.11.08.pdf (330.46 kb)