• by Jim Meskauskas , October 10, 2000

Checking out the Back-End. No, that is not the name of a new porno site on the web. I am referring to post-click activity data. Yes, that's right. The information that is to be had from tracking a visitor from initial contact with an advertisement to the time they actually satisfy the call to action on the advertiser's site. This is how most all campaigns are judged. Did I satisfy my cost-per-sale? Did I get enough visitors to the site?

Though the conversation is mostly circling around pay-for-performance these days, and it is a way of buying media that I still advocate, as I discussed last week, there is more to the whole advertising project than just advertising as sales channel. However, that said, it is still what most every client wants to use the web for. In that case, we have to look at media not from the front, but from the back.

This is a data-driven project, and right now online advertising is being subject to direct response metrics because it is being used as a direct response medium. When media is being purchased with this in mind, it should be the same motive that drives renewals for media. Be it click-through rate (the worst metric to use for a site) all the way to advertising-to-sales ratio (the best metric to use), the reason to buy and then renew with a site is almost always a response metric.

If your shopping sites via an RFP and at the end of the process, the reason for not buying or renewing with a site is that they're not satisfying a goal, let your site rep know. Be straightforward about what the objectives are and how the site can't meet them. Let a site under consideration know that you have a client with very aggressive acquisition goals and that according to your analysis, they're not paying out based on the metrics borne of the goals and objectives. A site can hardly argue with the numbers. The rep will appreciate your honesty and you'll have strengthened and/or preserved a relationship.

Now, granted, when planning and buying using sites with which you do not have experience, the best thing to do in determining whether or not they'll pay out is from data you have from other sites. Pick one that seems most like the property you've run on in the past and apply those data. Is it perfect, no? It never is. But at least you are using figures based on reality.

If you don't have any numbers from reality, use the industry averages. According to The Q2 2000 AdKnowledge Online Advertising Report (http://www.engage.com/adknowledge/oar/), the average CTR is about .4%. The look-to-buy ratio is still about 2%. Apply these and see what you get. From this you can back out any projected cost-per-whatever you want.

When negotiating renewal contracts, it isn't that different, only now you've got real data to use. For instance, when renegotiating with a site, back out a rate you need to accomplish the numerical objective of the campaign. If you've got a cost-per action goal of $5, figure out what kind of rate is n