• by Ross Fadner , June 15, 2004

Interactive industry players debated how to evaluate the return-on-investment from Internet programs Tuesday, at the Jupiter Media Internet Planet conference in New York. Panelists urged marketers to examine how they measure the consumer buying cycle and assess consumer buying behavior, and to consider the effect of branding on directed campaigns.

Panel moderator and Jupiter Research analyst Niki Scevak said that marketers need to think in terms of the buying cycle more than click-throughs and direct sales in assessing a campaign's ROI. Both Jeffrey Glueck, chief marketing officer, Travelocity.com, and Gayle Troberman, director of custom solutions for Microsoft Corp.'s MSN, both agreed that marketers need to track consumers over a 2- to 3-week period in order to accurately measure the ROI of an online campaign. Glueck revealed that Travelocity, for example, tracks consumers who look up flights for 45 days.

MSN's Troberman said that understanding consumer surfing intent leads to enhanced ROI. She pointed out that directed and undirected behavior mark the two primary types of consumer intent, and it is therefore crucial for marketers to distinguish between the two when delivering a message.

Troberman said that search is the classic form of directed behavior, where marketers have to reach consumers as quickly and succinctly as possible, whereas the passive user, who is just looking to kill time, presents marketers with "a serious opportunity to engage and entertain."

"On the Web today we [marketers] don't get that right a lot," Troberman said. "We interrupt direct consumers with pop-ups, and we don't engage consumers looking to be entertained." Troberman also suggested that as much as marketers want clicks, brand equity also needs to be valued highly.

At the same time, Travelocity's Glueck asserted that nobody wants to end up like Pets.com, investing in branding before a business model is firmly established. Glueck noted that half of Travelocity's traffic comes from online advertising, and while a lot of this comes from pop-up and search campaigns, he said that that pop up-effectiveness is "fading" and search is "beginning to level off." For Glueck, measuring ROI is a process that requires marketers to constantly take inventory of their analytics.

With regard to online spending, Glueck stressed prudence and timing. "Planning online can vary enormously ... Being relevant matters," he said, noting that Travelocity uses Claria [adware] a lot, and the relevancy of Claria's delivery "can have an enormous payoff."

Glueck also encouraged the audience to monitor developments in the search analytics space. He shrewdly noted that the most popular search term on Google is "Google," which means that many consumers use search simply to find the home pages of brands whose name they know, but not the URL. Glueck said that in order to accurately measure one's search campaign performance, it behooves marketers to separate companies' own branded keyword buys from other buys. As yet, he said there is no real solution to this problem, although companies might try asking their competitors not to search on their respective brand name.

"Once we pulled [Travelocity], our search ROI broke just about even," Glueck said, leaving him to wonder whether Travelocity was simply re-buying its own customers who might have found their way to the site anyway. Over the long term, Glueck said, "I expect search returns to go down over the next 24 months."

With regard to email marketing, Jupiter's Scevak noted that open rates and click-through rates are down partly because Internet Service Providers and other major email providers deploy overly aggressive filters. "Some legitimate marketers are almost like dolphins caught in the [fishing] nets," he said.

While all conceded that this continues to be a serious problem for marketers, Troberman opined that branding campaigns can actually help direct sales-based email initiatives succeed. "The more consumers know who you are and can trust you, the more loyal they will be." She said that trust can lead to consumers adding branded newsletters to their email address books.

Nike's "Art of Speed" advertorial, created by Gawker Media and now running online, is a notable example. Travelocity's Glueck confirmed that he has seen instances of consumers proactively doing this with Travelocity's newsletters.