• by Steve Smith , Staff Writer @popeyesm, July 20, 2007

There may be times when a declining click-through rate on a behaviorally targeted campaign is a good sign. When Advertising.com ran a comparative test of three campaigns that used both run-of-network and BT techniques, Brent Halliburton, director of network strategy, was surprised at the results. The targeted ads demonstrated lower CTRs than untargeted ads, and yet at the same time they showed much better results on the back end. This week, Halliburton walks us through that research and explains what it means to media planners.

Behavioral Insider: How did you conduct this study?

Brent Halliburton: We ran three campaigns on both run of network and targeted to appropriate behaviors and then compared performance: personal finance, automotive, and education. Given that we were comparing this to run of network, we used relatively broad behaviors to try to determine whether or not BT would provide lift. All the behaviors were content-based, people visiting relevant content as opposed to search post-targeting. These were the same creative. All we were testing was the difference in performance between the two types of audiences.

Behavioral Insider: What was the definition of conversion?

Halliburton: It was a specific action. For finance it was opening a bank account. For auto and education, it was a request for information. So much more than a simple click, this was actual back-end lead generation, or a step beyond to actual revenue generation.

Behavioral Insider: What performance lift did you see on the BT side?

Halliburton: What was interesting was we saw much higher conversion rates. In the case of personal finance it was double. In auto, conversion was quadruple. And yet in each instance we also saw lower click-through rates. The CTRs were more than compensated for by the much higher conversion rates we saw. But it was interesting to see that if an agency is measuring the success of their campaign by looking strictly at the CTRs of a campaign they may not recognize that this BT campaign is performing much better on the back end. And the clicks they are getting are real high-quality clicks.

Behavioral Insider: What level of CTR dropoff are we talking about?

Halliburton: What is more interesting is the big picture that emerges from the numbers. There is a message about the quality of clicks you get when you use BT. You see CTRs drop, and they vary  -- some by 50%, some by 20%. And in each instance you see conversion rates that more than double, kind of making up for low CTR with dramatically better back-end performance.

Behavioral Insider: I understand how the conversions and quality of CTR would be better on a BT campaign, but I don't quite understand why CTRs would actually drop when the ads are targeted.

Halliburton: That was one of the things that made me say this is interesting research. We don't have the perfect explanation for this either. We have a lot of hypotheses. And they are about human nature, so we aren't sure how to conduct a study to really test to determine which ones these are. I think it's possible to say that when you talk about advertising out of context, serious people that have demonstrated interest in this are the only people that click. So you are filtering out the window shoppers in an area vs. the buyers in an area. If someone is just passively interested in cars and not really interested in buying, then they may not click on it.

Behavioral Insider: The numbers seem to discourage using CTR data when measuring BT ads.

Halliburton: Looking at cost-per-click or CTR is not necessarily a strong proxy for cost-per-action or real engagement in a campaign. It emphasizes the importance of looking at brand engagement and doing more of the offline performance studies and putting pixels on a site and looking at back-end performance. It is not just saying that click-through rate X is a good or bad rate. You have to look at all of those through the lens of what kind of performance I'm expecting when I try to target someone. The answer we are seeing is here you get a very serious audience and those are the people who are the only ones who click through. and the ones with passive interest are less likely to click when seeing an ad out of context. So you see a huge lift in back-end performance but not the same CTR you see even in a run-of-network campaign.

Behavioral Insider: What are the implications of this kind of result on media planning generally?

Halliburton: It drives home that quality really matters. Not all clicks are created equal, and you could be buying lower quality clicks when you buy things at lower prices. But if you buy better performance products you see the value in the back-end performance. The second thing is the difference between the value of a click and the value of a lead. And advertisers have got to measure the true back-end performance, and they have to share that with their advertising networks and their publishers to help them optimize the buy on their behalf.

 
Behavioral Insider: How has research changed the way you sell BT?

 Halliburton: The first thing we did was to get out with our sales force and talk about how you position this product with advertisers. If it is an agency that only looks at click-through rates, you have to say that this is not the product for you because every click here converts. This is the best audience money can buy, but you will get fewer clicks. There are people who love to click on ads and will never buy anything. And this filters those people out, and the result is it has lower CTRs.