Thoughts about media in Canada

Comparing apples to apples

Hello,

If you read a few of my previous posts, you probably identified a redundant subject of mine: Wrong Methodology & Wrong Conclusions. Some sort of « Garbage in, Garbage Out » theme. This happens through a lot of campaigns at various stages

–          Failure to understand the real issue in a given situation leading to a wrong measurement set up

–          Failure to properly set up expectations

–          Failure to establish KPIs and a measurement plan

–          Failure to track properly

–          Failure to analyze data properly

–          Etc.

This post goes in the same direction. And the next one will, too. I would love to discuss findings more often, but I’d say most case studies and white papers I find on the internet are flawed & useless. What’s the point of throwing a proper paper out there that will be lost in a sea of mistakes?

Until the industry improves, I’ll write about methodology & data interpretation.

Here’s an example I’ve seen not once, not twice, but three times in the past month.

Clients want a Cost per Click (CPC) banner campaign. Agency wants a Cost per thousand (CPM) campaign. Clients say CPC generates more clicks. Agency says CPM generates more exposure and more indirect / Post-Impression site visits (no click on the banner but a delayed visit to the site in the following days). Clients and agency come to an agreement to use both CPC and CPM and to compare results. To do so, an adserver tag will be placed on the client site. If a site visitor was previously exposed to a banner that was adserved or tracked by the adserver, agency will know and will be able to attribute credit to all exposures leading to a site visit. CPM banners are adserved. Click trackers will be appended to CPC banners.

Campaigns run…

Observations:

–          CPC generated 600 clicks

–          CPM generated 100 clicks & 300 Post-Impression visits

–          So technically, CPC > CPM

–          But…

–          400 of the 600 CPC clicks were previously exposed to CPM banners

–          Credit is reattributed (I spare you the calculation)

–          CPC was responsible for 40% of visits

–          CPM was responsible for 60% of visits

Conclusion:

–          CPM > CPC

Dum dee dum…

Twiddle dee…

La lee laaaaaaaaaaa…

Here’s a picture of a cute cat…

Image

Erm… *cough*

Did you spot the mistake?

Client/Agency tried to save a couple of dollars.

When you buy CPM, you buy a fixed amount of impressions. You adserve a fixed amount of impressions. You pay a fixed amount to the adserver. No risk.

When you buy CPC, you buy a fixed amount of clicks. You adserve a variable amount of impressions. You risk paying a variable amount to the adserver. To avoid surprises, agency usually let the publishers adserve CPC banners themselves and append a click tracker to the banners. In other words, the agency pays the adserver and track banners that were clicked only. No risk. But…

Agency did not adserve and does not report on 99% of CPC impressions.

See where I’m going with this?

Now let’s back track and assume that CPC was also adserved by the agency, just like CPM

Observations:

–          CPC generated 600 clicks & 500 Post-Impression visits

–          CPM generated 100 clicks & 300 Post-Impression visits

–          So technically, CPC >>> CPM

–          But…

–          400 of the 600 CPC clicks were previously exposed to CPM banners & to other CPC banners too

–          80 of the 100 CPM clicks were previously exposed to CPC banners

–          Credit is reattributed (I spare you the calculation)

–          CPC was responsible for 85% of visits

–          CPM was responsible for 15% of visits

Conclusion:

–          OOPS!

Intuition tells me that these clients are not going to be so happy about their agency next year…

Me.tho.do.lo.gy.

Logic of the method.

Please to apply it

Cheers!

2 comments

  1. Pingback: Attribution Modeling – How to | Thoughts about media in Canada

  2. Pingback: Why I don’t trust (most) case studies | Thoughts about media in Canada

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