Conversions and Order Size Will Replace Clicks and Visits

April 13, 2009 | By Marc Porcelli | 2 Comments »

Marketers are increasingly under pressure to find more actionable and accountable means to spend their budgets effectively. There is no better way to do this than through online advertising. A great article appeared today in MediaPost. The article Performance Ad Metrics Slowly Shifting by Laurie Sullivan touches on some key points:

  • “Conversions and order size will replace clicks and visits ad the de facto standard to measure performance.”
  • The shift in performance metrics has been greatly accelerated by the economy
  • Performance through conversion and order size will become known as the traditional model

As technological advances in targeting have become more and more common, the inventory has become more and more diluted. What do I mean by this? Take for example inventory on say, CNN.com. In this fictitious example, assume inventory could only be purchased on a CPM basis. As more and more placements and sponsorships became available over the years, users became more and more ad blind; advertisers were pressed for more actionable results.

Due to this pressure (and with more inventory becoming available), competition increased and media buyers became better. Publishers began offering pricing on a CPC and CPA basis – better known as performance. Initially CPC and CPA were offered through more of a manual practice on the publishers end (highly time consuming). It was then offered through technology like Right Media.

The problem was that technology was so good and effective for the advertisers, that it actually decreased the overall net revenue for the publishers. In turn, this lowed their eCPMs having the adverse affect that publishers intended. Then came the recession that put even more pressure on inventory rates.

So why does any of this matter? It brings us to where we now are today. A place where “Conversions and Order Size Will Replace Clicks and Visits.”  Marketers are, and should be, demanding more actionable results for their dollars. Online marketers are becoming more and more savvy; no longer are they content with purchasing “branding” inventory at highly inflated or unaccountable prices.

Marketers are increasingly armed with comprehensive analytics that determine the value of placements and inventory that is purchased. These analytics not only can back-out what the effective conversion cost or order size is, but can also predict what the LTV of users are, down to the acquiring source.

All this information forces all involved in the online marketing space to be accountable and to deliver results! As more and more marketers demand results, they are increasingly finding a plethora of results online. The best part about the results is that they are often in real-time. You will NOT find a more accountable way to market your product, then to do so online.

Share
Related Posts:
Tagged: 
Category: Ad Networks, Behavioral Targeting, Media Buying, Monitization, Optimization, Recession Marketing

RSS feed | Trackback URI

2 Comments »

Comment by Stone
2009-04-13 20:20:25

So, do you recommend internet marketing sites like, Biz Ad Splash and MyAd, or any other?

Reply to this comment
 
Comment by Marc Porcelli
2009-04-13 23:21:26

My recommendation would depend on what your needs are. If you are generally looking to purchase inventory on a performance basis that is contextual or image-based I would say MyAds or Facebook Advertising could be a good fit (but they are buggy). Another to consider is Quigo. It really does vary greatly based on your unique needs.

Reply to this comment
 
Name (required)
E-mail (required - never shown publicly)
URI
Your Comment (smaller size | larger size)
You may use <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> in your comment.