2012: Rise Of Metrics, End Of Click-Through Rates

Ari-Jacoby-Metrics and measurement will become a major tool in 2012 for advertisers looking to quantify campaigns. Industry execs have been talking about it for years, but Solve Media CEO and cofounder Ari Jacoby believes the movement will begin to materialize next year.

"At least one major industry will do away with the click-through rate for brand campaigns," Jacoby said. "For display, I get the sense that all the exchanges that have cropped up will have challenges. They will continue to be measured on the delivery of the click-through rate, but there won't be enough to go around and prices will drop precipitously."

Jacoby believes brands will begin hearing more about "cheap CPMs" for non-viewable commodity inventory -- the type of ad space that serves up below the online fold on a Web page where the person viewing the page must scroll down to see the advertisement. While it is counted as an impression, no one sees it because the ad unit literally sits at the bottom of the page or too far off to the side.

Ad rates will come down significantly in 2012 because the units aren't valuable. There are only so many top positions on a publisher's Web site. Buyers will increasingly require audience participation far beyond what the industry refers to as "engagement," Jacoby said.

The ad industry will move toward brand lift metrics in 2012, as a replacement for click-through rates. These are around user engagement behavior, brand awareness and purchase intent, along with other measures of perception and persuasion.  

One caveat: ad executives have been burying click-through rates for years. Diaz Nesamoney, founder and CEO of Jivox, an interactive video advertising technology provider, wrote an article two years ago talking about the death of the click-through rate, which made its debut in 1993.

9 comments about "2012: Rise Of Metrics, End Of Click-Through Rates".
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  1. Kevin Bullard from ILFUSION Creative, January 3, 2012 at 8:21 a.m.

    this guy is a liar and a fraud as is his firm I am willing to bet. Click Thru Rates are the only way for the company paying you for your work to measure results...not some BS about CPM and net views etc. Huckster.

  2. Benjamin Theriault from KN Dimestore, January 3, 2012 at 9:14 a.m.

    (Metrix4Media is a pay-for-performance company & I have no personal stake in Solve)

    To interject on Solve's behalf, Kevin, your comment come across a little harsh. Solve has a good reputation in the market. To your point, CTR likely is not going to disappear over night and for DR campaigns will likely persist. For BRAND campaigns, however, the evidence speaks otherwise.

    Throughout 2010 and 2011 my firm has actually tracked trends that indicate a shift away from CTR and towards metrics that brand managers can correlate and genuinely understand - metrics such as Purchase Intent and Awareness, or when possible, impact upon Offline Sales.

    Savvy brand managers do not understand what a click means at the cash register, and the industry is actively questioning the reasoning for particular metrics of success.

  3. Ron Nickols from Agency Guy, January 3, 2012 at 10:50 a.m.

    this is already a reality.

  4. Kevin Bullard from ILFUSION Creative, January 3, 2012 at 5:01 p.m.

    I bet there is a move to "shift away" from CTR...IT helps remove accountability from the media firm. If you cannot point to firm reesults you can blamestorm in order to keep the struggling client under contract. Keep the CTR and do a good job and then ou don't have to sweat the results.

  5. Joel Rubinson from Rubinson Partners, Inc., January 4, 2012 at 9:25 a.m.

    Conversion rates are the way that we should measure digital ad effectiveness. a conversion is any behavior that the marketer tags as downstream action that is highly correlated with purchase (which will include offline sales marketers). The key is to consider conversions from views not just clicks which, I believe from my work with ShareThis accounts for no more than 10% of conversions.

  6. Brook Shepard from Mason Interactive, January 4, 2012 at 9:48 a.m.

    Ron Nickols - you're right.

    As agencies, we can set the tone. I remember when every client wanted 3-to-1 ROI - until one day Kevin Lee said it should be 5-to-1 at Ad:Tech. And so that expectation was changed.

    As a group, we basically charge 15% (some more, some less, etc...) We've set that expectation in client-land.

    We're the experts, and if it's in a clients best interest to focus on views rather than CTR, we can set that expectation and make it happen.

  7. Deborah Jaques from MSA Marketing, January 4, 2012 at 9:53 a.m.

    In the BtoB world, CTR is king because we've already found our target audience. The only reason not to emphasize their importance is if they aren't good. I pity the consumer marketers.

  8. Kevin Bullard from ILFUSION Creative, January 5, 2012 at 7:57 a.m.

    Deborah gets it...the ONLY reason someone wants to step away from CTR as The Yardstick is when the numbers stink. Obfuscate, move the goalposts, etc...anything but admit to the client that you and your firm have failed the client. Shameful.

  9. Nick D from ___, January 5, 2012 at 4:02 p.m.

    Good caveat there!

    "Throughout 2010 and 2011 my firm has actually tracked trends that indicate a shift away from CTR and towards metrics that brand managers can correlate and genuinely understand - metrics such as Purchase Intent and Awareness"

    Meh: purchase intent and awareness are *campaign result* metrics; what's being talked about is *campaign delivery* metrics - basically, what did I get for my media-buying money, rather than what impact did my creative have. Both are necessary, but one is very different from the other.

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