The 4Ps have acted as a right of passage and guiding tool for marketers for decades. But in today’s complex digital environment, where advancements in technology have rapidly changed the delivery and measurement of digital advertising, what new guiding principles should marketers take into account to navigate and succeed in this evolving environment?
In our latest report, Lessons Learned in Digital Advertising, we take a look at key issues that help shed light on the current state of the industry and how advertisers can get the most from digital. From these lessons learned, we’ve identified a new list of 4Ps to guide marketers in a digital world: People, Performance+, Programmatic, and Platforms.
People
It might seem trite to say that consumers are the core of advertising. Of course to make an impact, advertising must reach a person, especially the right person with the right message. However Internet advertising has rather been focused on the addictive metrics of cookies, clicks and served impressions.
One of the greatest promises of the Internet is the ability for advertisers to target with extreme precision and deliver a tailored message to their customers. Cookie-based targeting certainly helps to deliver on this promise and is a core reason why cookie targeting has become such a popular digital strategy. However, solely cookie-based planning and evaluation isn’t always the best approach.
Cookie deletion is a reality that has created challenges for accurate measurement of digital audiences and accurate targeting of advertising. In fact, Comscore found that 28% of Internet users in Europe delete their first-party cookies per month and they do so an average of 4 times during the month. This means a server-centric measurement system will typically overstate the true number of monthly unique visitors by a factor of up to 2.4X; this underscores the fact that a unique browser, a precise term of web analytics, is not equivalent to a unique visitor, even though the two are often incorrectly used as if synonymous.
Likewise, 37% of Internet users in Europe delete their ad server cookies per month and do so an average 6 times during the month. When it comes to campaign evaluation, these high levels of cookie deletion can wreak havoc on results provided by ad or website servers. With reach and frequency reporting, for example, the use of a solely cookie-based ad measurement solution can generate a 3.5X overstatement of reach and understate frequency to the same degree.
In addition to challenges with cookie deletion, the fact that cookies are not people can also make it difficult to ensure the correct person is actually being served the ad. Comscore data shows that 48% of European Internet consumers use multi-user machines. This means that a cookie cannot accurately identify who is on the computer at any given point in time and can result in misattribution of the ad exposure.
Performance+
To understand the full impact of digital advertising, marketers need to take a performance+ approach that takes into account key effectiveness measures such as brand awareness, behavioural impact, sales lift, etc., that go beyond incomplete and often misleading metrics such as click-through rates.
Today, CTRs on display ads in a campaign are extremely small in the UK at just 0.14%. That’s only 1.4 clicks per one thousand impressions. While the click on a display ad is still being used by some as a measure of campaign effectiveness, Comscore and other industry research has proven time and again there is no significant, positive correlation between clicks and key effectiveness measures of advertising.
Does the fact that so few people click on ads mean that online advertising does not work? The answer: a resounding “No”! Instead, it points to the simple, yet powerful fact that relying solely on a CTR is incomplete and often misleading. Fortunately, there are a variety of other metrics that can be used to demonstrate the impact of online advertising.
A recent series of Comscore studies conducted in Europe revealed the following positive campaign results in the face of minimal CTRs:
Programmatic
Programmatic audience buying has been heralded as the ideal solution to current ecosystem challenges – with its ability to reduce costs while enabling improved targeting accuracy and ROI. However great the potential efficiency gains of programmatic, it is important to have realistic expectations whether each served ad will be seen by the intended audience.
Transparency is vital in the shift from high-touch, direct buying to low-touch, automated trading. Clients and their agencies need to be able to discern the quality of campaign delivery as it relates to viewability, brand safety, non-human traffic and target audience. Comscore’s benchmark for viewability in the UK is currently 38% of served impressions and 41% for on-target audience delivery. There are many factors that affect performance, but whatever is agreed as success for a campaign needs to be grounded in this reality. Having access to campaign delivery data in real-time and pre-bid insights can provide this much-needed transparency to the market and help support further trust in the digital market.
Platforms
Increasingly, audiences are consuming content across a variety of screens, platforms and devices – and as eyeballs are moving to multi-screens so are advertising investments.
Multi-Platform digital consumers – those that access content across desktop computers and mobile devices such as smartphones and tablets – now account for 75% of the online population in the UK, underscoring the importance of understanding the behaviour of this new digital majority.
In this fragmenting digital environment, advertisers need to understand how their advertising is reaching and impacting consumers across screens. Indeed, a unified, unduplicated accounting of media consumption and advertising delivery will facilitate smarter media buying, selling and evaluation.
In order for online advertising campaigns to achieve optimal impact, provide the opportunity for real-time optimisation and be fully comparable to TV, campaign measurement of true audience delivery needs to be scalable and granular. Faster and more reliable in-flight reporting will open the door for more efficient evaluation across channels and a better understanding of the value of digital relative to traditional media, like TV.
Digital can grow out of its direct response silo by focusing on people and the “Human GRP” rather than cookies, clicks and served impressions. Only then can it take its place in the full marketing mix for brand advertising. Advertisers have already demanded this change in the US where trading on viewability and audience guarantees is becoming the norm. Time for the UK to make the shift too?
For more on the Lessons Learned in Digital Advertising, download a complimentary copy of the report here.