Commentary
Just One Opportunity for 2009
- by Matthew Greitzer , Op-Ed Contributor, December 30, 2008
Let's first agree that no one, no matter how sophisticated and nuanced their measurement technology, accurately measures search success. There is no ROI calculation, attribution model, or engagement map sophisticated enough to capture the totality of interactions between search, and other marketing channels and fully reveal the interplay and impact of each on customers' buying decisions. So we compromise. And in search, perhaps more than any other channel, we've come to agree that our compromise on measurement is pretty darn good. We've settled squarely on directly measured, Web-based response metrics (sales, leads, revenue, etc.) as the primary indicator of value. And these metrics have a profound influence on everything from our optimization decisions to segmentation and targeting to budgeting to internal and external resourcing against the search opportunity. To date, these metrics have served us well.
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What we've seen in the last quarter of 2008, however, is that every metric, whether derived from search, banner media, offline advertising, or "other," is up for debate as marketers scrutinize their investments like never before. And while this may seem like a threat, it's likely the single biggest opportunity to come across the search marketer's desk in years. For the first time in a decade, marketers are intensely interested in revisiting their assumptions about ROI. Given this period of open-mindedness, there are three specific topics search marketers can and should exploit. All three will benefit the channel in the long run.
First and foremost, we should factor in value outside of the online order process. The low-hanging fruit here includes phone orders (still not tracked by many search marketers) and email sign ups (tracked, but seldom explicitly valued). Beyond that, we should develop a model for valuing search-driven interactions based on their contribution to sales outside of the digital channel. Multichannel retailers will be interested in understanding how search-driven traffic translated into in-store sales. Non-transactional marketers (CPG, pharmaceutical, etc.) will look for metrics beyond clicks and page views, in search of a more accurate measure how search-driven site interaction corresponds with purchase intent. We can answer these questions through a combination of qualitative and quantitative data (surveys, and site-side KPIs vetted against actual purchase behavior). This model should feed our search ROI analysis, not as a sole input, but as part of a whole.
Second, we should push incessantly for brand awareness, message association and brand favorability metrics as a factor in evaluating search marketing success. Search has profound impact on consumers' perceptions of brands. This has been proven, a dozen times or more, across many different categories. Yet search is seldom, if ever, accorded the same luxury as display media, television and print when it comes to "brand value." Search marketers should use the openness to new metrics in 2009 as an opportunity to right this wrong, and ensure marketers understand the strategic branding opportunities available in the search landscape. These, too, should be modeled and fed into search ROI analysis as part of a whole.
And third, we should quantify and include into our success metrics the opportunity costs of not participating in the search landscape, or segments therein. Admittedly, this is the fuzziest of the three areas of opportunity, but a real opportunity nonetheless. There is value in blocking competitors from certain keyword segments, and value for keeping cost pressures on those competitors for targeted keywords. This value may be secondary, or even tertiary, but it, too, can and should be quantified and factored into search ROI decisions.
The good news for search marketers, then, is through these measures there is a compelling case to be made that search is underreporting value and making erroneous budgeting and optimization decisions as a result. The audience for these message is receptive, and earnestly looking for better answers relating to measurement. The bad news is that our case will not be unique; every other channel, too, will make the argument they are undervalued, under-measured, and underinvested. We should be prepared for this, but not intimidated. In the worst case scenario, search has a better story to tell than most other channels. In the best case scenario, savvy marketers will use this as an opportunity to embark upon a more comprehensive, cross-channel approach to measurement and ROI attribution. In both cases, search marketers win. Happy holidays, and good luck to you if you take my advice and strive to redefine success in 2009.
Social media monitoring and analytics is going to be the biggest story in search in 2009. User-generated content is close to becoming an equivalent information resource to traditional sites yet most of these search marketing columns pay little more than lip service to it. I understand that for conventional search marketing this occurs because your current models don't fit social media, however that doesn't mean that this column and the search industry in general shouldn't be working hard to understand it. Social media will be the primary communications medium, period, by the end of 2009.
Totally agree that search success brings a lot of "value-added" elements that go under-reported when just looking at basic metrics. Unfortunately, think most marketers do not have the budgets to spend to prove these ancillary benefits (especially in this economy) so it is incumbent on us to help them connect the dots through studies done by Marketing Sherpa, SEMPO and others. Finally, as you say, the trend toward closer examination of all channels in terms of ROI bodes well for search marketers in 2009. Happy New Year.
SEO, social media marketing and monitoring/analytics are going to be the most heavily invested area of marketing for all businesses in 2009. Especially as time will show that the ROI is greater with search and social media marketing tactics than any other current medium. Search and social media can be compared to the time when TV first came out and commercials aired. If nothing else I certainly believe 2009 will be the year that changes future marketing spending.
Social media marketing has no more impact short term than highway billboards, but it does provide the brand awareness when spend intent enters the equation.
The current economic enviroment mandates improved methods of measuring ad ROI as it translates into immediate results. Real time per transaction measurements are available, some which provide dynamic pricing based on outcomes. The larger search engines have not been receptive to this results driven process, which removes pricing control from their domain and places it where it belongs, in the measured outcomes resulting from online advertisement. Companies like Fair Isaac have recognized the value this poses and have entered into joint ventures with an aedexchange that provides performance based pricing, complemented by Fair Isaacs metrics. Whether one of these mechanisms becomes the gold standard remains to be seen, but 2009 finally appears to be the "when" for real time transaction based pricing.
Creating brand awareness by providing a banner under which online socialization occurs may eventually create the next big thing but few advertisers have the dollars today to spend in anticipation of a longer term return. The ability to quantify immediate ROI will provide the currency to mold the consumers mind longer term via social site advertising.
Hi Matt,
Great to see others out there speaking about cross channel tracking. It's something that we here at Yahoo! are very focused on. We're looking to deliver some exciting reporting and measuring tools in 2009 that will provide advertisers and online marketers with better actionable insights into their ROI. These tools will allow advertisers and marketers to make smarter budgeting decisions moving forward. This comes at a perfect time due to the current economic situation
I noticed Marc mentioned above that, "Unfortunately, think most marketers do not have the budgets to spend to prove these ancillary benefits (especially in this economy)...."
There are actually free tools available right now to help online advertisers measure cross channel perfomance. One example is using the Full Analytics reporting in an advertiser's Yahoo Sponsored Search account. Full Analytics enables an advertiser to track any kind of online campaign (search, display, email, etc) under one roof and see if that campaign is driving conversions for other campaigns (using the Assist metric).
For example, a visitor may click on a display ad and later convert off a search ad. The result is that the display ad gets the Assist and the search ad gets the conversion. This allows the person, responsible for managing the display budget, to make smarter decisions about how he/she spends their display budget. While they may have thought that the display ad was not performing well on it's own before, they now see (using Assists) that it actually was valuable at driving conversions to other campaigns. This saves the advertiser some serious cash and heartache because they don't end up pulling the budget on a successful campaign.
Here is some more info about this: http://www.ysmblog.com/blog/2008/11/03/measuring-search-and-display-for-success/
Looking forward to a great 2009 due to better measurement!
Matt