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Gian Fulgoni of comScore on Online Advertising Effectiveness – Forrester Marketing Forum

Gian Fulgoni, Chairman, comScore’

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– The right metrics are critical

– It’s not just about direct response

– Need to measure offline as well as online behavior

– Post-buy measurement of delivery of media plan

“A lot of good changes occur in the toughest times because it causes you to question what you’re doing.”

Online advertising: $20+ billion in the US – $23.4B in 2008, 8%. 20% to direct mail, 12% newspapers, 23% TV (distribution, cable, broadcast combined), 6% radio, 5% Yellow Pages. Total: $296.8 billion.

“If anyone thinks the Internet is going to replace TV… In 08 the total amount of time spent watching television in the US grew by 4%. That growth alone was greater than the total amount of time spent watching online video.”

In Q4: search was 47% of online ad spending. Display ads totaled 33% including banner (21%), rich media (7%), video (3%), sponsorships (1%). Q1 08 display grew 27%, Q4 display SHRANK 4.3%. Banners, Video went up, rich media, sponsorships down in that 4.3% drop. “Advertisers are shifting from the more expensive display formats to the less expensive display formats.”

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Online ad spending Q4 2008 - gian fulgoni comcore&160;

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Cookie Deletion

Measured Yahoo and DoubleClick cookies

– 30% of Internet users delete their cookies in a month – corroborated by Belden, Jupiter, Nielsen

– These deleters do so an average of 4 times a month – user can be counted as 5 unique visitors

– Rate of people deleting hasn’t grown, but people who do delete do so more often

Massive decline in display ad click-through rates

  • July 07 study: 32% of people clicked a display ad, 68% didn’t click
  • Concentration of clickers – Top 6% of clickers account for 50% of all clicks
  • Recommendation: only use clicks to evaluate direct response ad campaigns, or search
  • Clicks don’t reflect campaign’s sales impact, or brand building

Search Study

  • 25% buyer conversion from search
  • 92% of buying that occurred was offline – that’s what needs to be measured
  • If you’re just measuring direct impact of a click, you’re likely understating the ROI by factor of 6X

Post-Buy Analysis Summary

  • 8% hit target with >5 frequency
  • 61% in US but not target
  • 19: Frequency <4
  • 12% Outside US

Big value proposition not yet taken advantage of: big global brands have yet to run global campaigns through one buy. Internet’s the only medium to reach the world.

Holistic Impact of Online Ad Campaigns

– 200+ studies by comScore assessing impact of paid search and online ads on online, offline sales

– Display ads don’t just increase site visiting: trademark searches continue to see lift over four weeks after exposure to an ad

– For making a purchase (retail only): search and display exposure combined: 173% lift

– Incremental impact on retailers’ offline sales per 000 exposed: search + display = 119%, search only = 82%, display only = 16%

– Higher reach of display ads often helps lift sales more than search – reach of display 10x what you get with search

– 82% of online campaigns comScore has measured have generated average lift of 18% in CPG sales in retail stores

– Short term retail CPG brand sales lift from online advertising matches long-term TV impact

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Check List

– Cookie deleting is reality

– Display ad click-through rates are minimal

– What must be measured:

  • post-buy of media plan
  • immediate/latent effects
  • search display ad campaigns
  • online/offline behavioral impact

Discovery

  • Even with no clicks or minimal clicks, online display can generate substantial lift in site visitation, trademark search queries, lift in online/offline sales
  • Higher online sales lift found for search ads vs. display, but when combined synergy provides even more lift
  • ONline ad offers lower cost, better targeting, interactivity, sales impact

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