Brand building vs. performance marketing
When analysing campaign data there are different metrics we can use as key performance indicators (KPIs) that provide insights into campaign effectiveness.
In the middle of a pandemic, understandably, many brands are looking for cost-effective methods to gain immediate insight into target consumer behaviour and stretch marketing dollars. According to WARC's Marketer's Toolkit 2021, a global survey of marketers revealed that the majority (70%) of those expecting budget cuts this year predict that the axe will fall on brand advertising spend. In comparison, performance marketing will be the least affected area of investment.
In an ideal world, brand building and performance marketing enjoy a wonderful relationship of complete alignment. But of course, we do not live in an ideal world. Instead, most organisations are affected by a total disconnect between the two. As a result, the criteria for measuring marketing effectiveness are often imprecise and rely on impressions, clicks, and CTR as metrics to measure a successful campaign, creating a significant imbalance.
While performance marketing and brand building are crucial, we still need to look at these metrics collectively to get a better idea of the campaign’s overall success and achieve sales growth.
For instance, revenue on investment (ROI), return on ad spend (ROAS), cost per acquisition (CPA), and customer lifetime value (CLV) are just a few of the key metrics that aren’t properly measured – if they are tracked at all.
At Acquire, one of the many insights we’ve gained from running multiple performance-driven campaigns is that there’s usually no direct correlation between a metric like CTR and actual conversion. In other words, a campaign celebrated for generating a higher CTR, might still fall flat on conversion volume and even marketers who have moved beyond vanity metrics still have a one-dimensional view when it comes to measuring conversions.
Channels such as Display that aren’t prone to driving clicks, are often disregarded when evaluating the performance based on CTR and conversions measured in Google Analytics, while Programmatic Display, which arguably has the best targeting capabilities, gets similar treatment.
Post View Conversions is the best way to realise the full potential of these overlooked channels, because it measures conversions that occur because of an exposure rather than a click. Display for instance, drives nearly all post view conversions, where a well-targeted user will be exposed to an ad and then visit the website at a later date to convert.
Or, if the KPI is CTR, by looking at other metrics like Time on Site and Bounce Rate in relation to CTR, we start to get a better view of the bigger picture beyond just clicks. And in this way, we ensure we’re not only achieving clicks but also engagement and relevant traffic to the website.
To align digital campaigns with business goals rather than vanity metrics, we’ve developed our own measure called quality Cost Per Click, also known as qCPC. qCPC tracks metrics like where visitors have come from, what they do on your site, how long they stay, bounce rate and conversion. We weight those factors and adjust our buying, in real time, based on qCPC.
Only when we start to use proper attribution practices do we realise the true value of our digital media mix. From this point, we can begin to link our campaigns to business goals, allowing us to show stronger value and make better decisions with media strategy.
So, while vanity metrics like CTR prevail as a measure of campaign success, they should be taken with a grain of salt. Only when marketers put strong attribution practices in place will they be able to show the real value they bring to your organisation.
Key terms to measure a campaign:
Bounce Rate: The percentage of visitors to a particular website who leave the site after viewing only a single page.
Click Through Rate (CTR): A percentage showing how often people who see your ad end up clicking on it.
Conversion Rates: The percentage of visitors to your website that complete a desired goal (a conversion) out of the total number of visitors.
Cost Per Acquisition (CPA): The cost of a campaign divided by the number of conversions/sales/leads.
Cost per Click (CPC): The cost taken to deliver a click on an ad.
Cost per Mille (CPM): cost per 1,000 impressions
Customer Lifetime Value (CLV): The entire amount a business earns from the average customer over the whole period of their relationship.
Performance Campaign: A campaign in which an advertiser is looking for users to undertake a specific action, such as purchasing a product.
Engagement Rate: The percentage of ads that have been interacted with.
Incremental Value: Increased value measured on an index or scale.
Post Click Conversions: A conversion that occurs after a user has clicked on an ad.
Post View Conversions: A conversion that occurs after a user has viewed an ad.
Return on Investment (ROI): How much profit you've made from your ads compared with how much you've spent on those ads. To calculate your ROI, take the revenue that resulted from your ads, subtract your overall costs, then divide by your overall costs: ROI = (Revenue - Cost of goods sold) / Cost of goods sold.
Return on Ad Spend (ROAS): A metric used to calculate the return that an advertiser gets in terms of revenue from sales vs their ad spend.
Video Quartile Completion: The percentage of video ads delivered that were watched until the 25%, 50% and 75% mark.
Unique Users Reached: Measures the total number of people who were shown an ad.
Time on Site: The amount of time (in minutes or seconds) that visitors have spent on your website.
Viewability: Viewability is a measure of whether an ad had a chance to be seen by a user.
View Through Rate: The percentage of video ads delivered that were watched all the way through.