Measuring Online Ads Properly

March 5, 2010

Online advertising agencies need to focus less on impressions and more on serving the needs of their clients’ audience, according to John Burbank, CEO, Nielsen Online Division.

To obtain the business and trust of brand marketers, Burbank advises online advertising agencies to focus on the “right” way of measuring maximum reach, attitudinal impact, and efficiency.

Maximum Reach Rests on Reach, Frequency, Efficiency
Proper measurement of maximum reach does not simply count impressions. Instead, it measures how many custom targets and most valuable customers saw an ad, how many times the desired audience saw an ad, and whether an online ad costs more or less than other media.

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Attitudinal Impact Should Consider Traditional Brand Metrics
Measuring clicks, searches and/or website visits are all ineffective means of measuring attitudinal impact. Instead, agencies should use test and control groups of exposed and unexposed consumers, and measure traditional brand metrics such as awareness and purchase consideration against the target.

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Sales Impact is Measured Offline
Measuring online sales impact is not a true accounting of an online ad’s performance. Offline sales impact, where most customers still shop, should be measured using test and control groups.

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Ads will Continue Shifting Online
Burbank predicts the shift in brand dollars to the web will continue accelerating, punishing agencies which rely on simple impression and click measurements, and rewarding agencies which measure ideal audience response.

In addition, Burbank forecasts that brands will want to extend their value across the multiple platforms of internet, TV and mobile, and that data quality will become increasingly crucial.

Online Ad Spending Growth Weak in ’09
While Burbank predicts significant future growth in online advertising, as measured by dollars spent, online ad growth in 2009 was anemic, according to earlier Nielsen research. Internet ad spending only grew 0.1% last year. As a possible mitigating factor, the only other ad spending categories that reported growth last year were Spanish-language cable TV (32.2%), cable TV (14.5%), and free standing insert (FSI) coupons found in printed newspapers and magazines (11.5%).

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