measuring online ads

7/30/2019 Measuring Online Ads

1/23

http://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htm

Measuring OnlineAdvertising Effectiveness

Overview Intro Traditional Advertising Types of Online Advertising Why Measure Advertising Effectiveness What to Measure Where to Measure When to Measure Quantitative Methods of Measuring Advertising Effectiveness Endnotes & Sources

This page has been brought to you by JoRi,students from Prof. Richardsons MGTD06 classat the University of Toronto (UTSC) in the Sept-Dec 2006 term

Joanne Abbawi Rimon Matyas

.
http://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htmhttp://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htmhttp://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htm


2/23

How this

unit came

about...

Since the development of the D06 Marketing in the Information Agecourse Prof. Richardson has been discussing the efficient use of all the E-Commerce tools. These discussions were included within each of the units,

however there was not a specific section covering the topic of measuringonline advertising effectiveness. During the fall 2006 session of D06studentsJoanne Abbawi majoring in finance and Rimon Matyas majoring inmarketing approached Prof. Richardson about developing a unit dedicatedto measuring the effectiveness of online advertising. The newly formedteam named JORIhad the goal of combining the team members expertiseto research and develop a unit that will discuss both the marketing andfinancial implications of online advertising. This newly formed unit includedan intensive discussion of the different ways to advertise online, theevaluation techniques used in choosing the most appropriate advertisingmethod and the methods used in evaluating the effectiveness of the ads.Furthermore the unit compared these marketing concepts to financialconcepts such as costs benefit analysis, ROI and budget

decisions. JORI worked on this unit from September to December of 2006and the unit was finally added to Prof. Richardsons site on January of2007.

Unless otherwise quoted, the text in this unit is JORIs interpretation oftheir research findings. For additional source information please refer totheEndnotes & Sourcessection.

TraditionalAdvertising

Measuring the effectiveness of traditional advertising has been done in the 1990's and

1980's through different processes.

.Some people who are experts in this field use numbers related to

audience size - if it is broadcast [TV or Radio] circulation - if it is advertising in a periodical number of addresses - if it is postal related, ie. flyers in mailboxes and other formats

Traditionally when people buy advertising, they buy it from people who can "deliver"

10,000 addresses of people in a town 25,000 listeners in a radio program 40,000 readers of a community newspaper

The pricing is based on cost per contact - the term most often used was CPM - cost perthousand
http://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htm#Endhttp://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htm#Endhttp://www.witiger.com/ecommerce/MeasuringMarketingEffectiveness.htm#End


3/23

Types

of Online

Advertising

Whenever the word online advertising is mentioned, the first thing that anyone thinks ofis banner ads. However, banner ads are not the only form of online advertising by anymeans. This section will explore the different forms of online advertising and their uses.

It is important to note that although there are numerous ways to advertise online, not allof them will suit the needs of all websites. Choosing the right method for your site isdependent on your GOPST analysis, as only a few types will help with your Plans andStrategies.

Some of the more popular means to advertise online are:

1. Pay Per Click/Pay Per Sale: Advertisers often develop deals with search engines oraffiliate sites where they pay a predetermined amount for each click-through that isforwarded to them from the third partys site. This practice is known as Pay PerClickadvertising and it is useful in increasing traffic for the advertisers sites. However,this method does not guarantee any increases in sales since the potential customers

might just click through and move on.

Pay Per Sale on the other hand links the advertising costs to future sales.

By using the Pay Per Sale method, the advertisers only paythe third party if the customer actually clicks through and

makes a purchase. In this case, a predetermined amount ora percentage of the sale is paid out to the third party. As withthe Pay Per Click method, a potential disadvantage is thatalthough the advertiser is only paying for sales made, theyare still paying for the cost of the bandwidth that is used byvisitors that just click-through and simply move on.

n 2. Search Engine Order: Just as mentioned in the Search Engine Order (SEO) rankingsection, Proactive and Paid submission of the advertisers site to the Search engine actsas another


4/23

advertising method. Increasing yourSEO ranking not only increases trafficto your site but acts as a means of

advertising your brand. Oftenadvertisers not only pay for the SEOsubmission fees but also for theservices of SEO consultants in thehopes of taking advantage of thispowerful tool. (For more details visittheSEOsection)

3. Banner Advertising: horizontal bars placed at the top of a web page linking to theadvertisers site. Banner ads usually have a lot of colour, graphics, animation and somestatistics as they are used to promote, persuade and remind customers. Banner ads areby far the most popular means of online advertising, although it has been argued thatbanner ads are not effective in increasing sales. Opponents of banner advertising oftenargue that web surfers more often than not ignore banner ads and thus reducing theireffectiveness. (For more details visit theBanner Adssection)

4. Sky-Scraper Advertising: a slang term used to refer to vertical spaces that run onthe left or right sides of a page to display ads. Sky-Scrapers are similar in many aspectsof their functionality to banner ads with the exception that they remain visible even whenthe visitor scrolls down the page. For this reason Sky-Scrapers are more expensive for

the advertiser than banner ads.(To see an example of the costs associated with Banner & Sky-Scraper Advertising visitthenickles.comwebsite)
http://www.witiger.com/ecommerce/searchengineranking.htmhttp://www.witiger.com/ecommerce/searchengineranking.htmhttp://www.witiger.com/ecommerce/searchengineranking.htmhttp://www.witiger.com/ecommerce/bannerads.htmhttp://www.witiger.com/ecommerce/bannerads.htmhttp://www.witiger.com/ecommerce/bannerads.htmhttp://www.nickles.com/media/banner_media.asphttp://www.nickles.com/media/banner_media.asphttp://www.nickles.com/media/banner_media.asphttp://www.nickles.com/media/banner_media.asphttp://www.witiger.com/ecommerce/bannerads.htmhttp://www.witiger.com/ecommerce/searchengineranking.htm


5/23

5. Sponsorships: a newer form of online advertising that allows theadvertiser to sponsor a section or content of a page. Regular Sponsorshipsallow the advertiser to rent a section of the page to display their logo, amessage or a promotion. Content Sponsorship allows the advertiser tosubmit the content they would like to display on the page and afterevaluation this content is displayed/advertised. This gives the advertiserslightly less control in the message they want to advertise, but on the otherhand it might be more effective in ensuring content integration between thepage and the advertisers message. An example of Content sponsorshipswould be This cool Video is sponsored by ABC.com

6. Pop-ups and Pop-downs: new windows that appear as soon as the user types awebsite URL or click on a link from the third parties site. Pop-Ups open a new smaller

window displaying the advertisers message andPop-downs appear on the bar at the bottom of the

screen. Often for the user to be able to close thesemessages, they would need to click on them makingit an annoyance for the user. Today users oftenhave programs that work to block these messagesfrom appearing, thus making them reallyuseless. (Some of the disadvantages associatedwith using Pop-up ads are highlighted on theAKAMarketingwebsite)

7. Interstitial Advertising: similar to Pop-upsInterstitial ads open a new window when theuser moves between pages on a site. Althoughthe users can simply close them and move on,research has shown that they have higher click-through rates than banner ads as the visitor isforcefully exposed to them. If done properlyinterstitial ads can be a good method ofexposing the visitor to the advertiserspromotions while they are on the advertiserssite. On the other hand if done poorly Interstitial

Ads can be irritating and drive away a lot ofpotential customers.
http://www.akamarketing.com/pop-ups-are-pop-bad.htmlhttp://www.akamarketing.com/pop-ups-are-pop-bad.htmlhttp://www.akamarketing.com/pop-ups-are-pop-bad.htmlhttp://www.akamarketing.com/pop-ups-are-pop-bad.htmlhttp://www.akamarketing.com/pop-ups-are-pop-bad.html


6/23

8. Mailing Lists & Newsletters: newsletters ore-flyers that are e-mailed out to potentialcustomers often after they have submitted theiremail address to the advertiser. In otherinstances the potential customers emails arebought from information mining companies andthus the mailing lists and newsletters may beundesirable to the potential customers. In thiscase, the mailing ists and newsletters are a formof spam and may have a negative effect for theadvertisers. If done properly the mailing list and

newsletter methods may be very efficient as ittargets a specific demographic that has alreadyshowed interest in the company by voluntarilysubmitting their email address.

9. Online Coupons: just like traditional coupons,online coupons are a good way of attracting new

customers to the advertiser. This method is effectivein that it gives the consumers a reason to visit theadvertisers site immediately to find out moreinformation about not only the product but thecompany itself. These coupons may be distributedusing a variety of the advertising methods mentionedabove.

10. Other Online Advertising MethodsSome of the emerging Online Advertising methods include

a) Blogs

b) Podcastingc) Product Specific forums

Although these methods are not primarily focused onadvertising, they can substantially supplement the

online advertising and marketing process.(For more detail on these tools visit

thePodcastingsection).
http://www.witiger.com/ecommerce/podcasting.htmhttp://www.witiger.com/ecommerce/podcasting.htmhttp://www.witiger.com/ecommerce/podcasting.htmhttp://www.witiger.com/ecommerce/podcasting.htm


7/23

Reasons

forMeasuringAdvertisingEffectiveness

Previously we mentioned that choosing the right method of online advertisingdepends on the business GOPST needs. The next section will highlight the reasonsthat make measuring the chosen methods effectiveness an important aspect of the

businesss success.

Reasons why Companies should Measure Advertising Effectiveness:

1. Avoiding Costly Mistakes:According to emarketer.com, Online advertisingspending will reach $16.7 billion in 2006, eMarketer predicts. That's a growth rate of33.2%, the highest growth year-over-year expected this decade. This means thatcompanies are spending thousands if not millions of dollars each year to advertiseonline, but that is not to say that it is being spent wisely. The only way to ensure that thismoney is not being wasted on ineffective advertising programs is to continuouslyevaluate the effectiveness of the chosen programs and to ensure that these programsare achieving their intended purpose. Evaluating the effectiveness of the chosenprograms is not all about money, it also gives the e-marketer the opportunity to analyzethe non-tangible effects of the chosen program. For example, if a company chooses togo with a pop-up advertising program, they can evaluate its ROI by comparing its click-throughs to the amount of money invested in building it. However that is not the extendof it; a good evaluation program will be able to analyze the consumers reaction to that

program, its effects on the companys image or its effectiveness in comparison to abanner ad program.

KeyPoints:

As the saying goes, "a penny saved is a penny earned." If advertisers think ofthe cost for efficiency testing as an investment that prevents future costlymistakes they can think of the prevented costs as a penny earned and takefull advantage of the benefits of this strategy.

2. Evaluating Alternative Strategies: Not only is itimportant to evaluate the effectiveness of the chosenmethod, but also the opportunity costs of choosing thatmethod. Often after companies have chosen a method,they focus their attention exclusively on that methodignoring the potential profits that would have come about ifthey went with an ulterior method. A good evaluationprogram will be able to analyse the effectiveness and theopportunity costs of the chosen method.


8/23

3. Increasing the Efficiency of Advertising: often aftercompanies choose a particular method, they becomeattached to that method and lose sight of the initial goalthey were aiming for. Because the marketers know whatthe intended message of that chosen program is, theyexpect their customers to know that message as well. Acontinuous evaluation of the chosen program will ensurethat the message the consumers are receiving from thisprogram is aligned with the message the marketerintended to send.

eMarketer's"Measuring Online Advertising Effectiveness"article identifies four key mega marketingand media trends:

"1. Increasingly, when it comes to advertising and marketing, the consumer is in control; consumersare rejecting advertising they find objectionale, annoying or just plain boring; but they are seekingout ads they find entertaining or highly informative.2. Companies are placing an increased focus on accountability and measurement of their advertisingefforts; CMOs are now being held to the same ROI yardstick as their CFO and CTO counterparts.3. Marketers are placing a greater emphasis on targeting, as a complement to their increasinglydifficult-to-achieve mass reach efforts.4. The media world continues to fragment, making it harder and harder for marketers to reach theirdesired target efficiently and effectively."
http://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdfhttp://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdfhttp://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdfhttp://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdfhttp://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdfhttp://www.chicagoima.org/on_ad_eff_white_jun04_v2.pdf


9/23

As a result, the internet is being used more as an advertising medium. This leads to the importancefor companies to learn about advertising effectiveness to attain more consumers and a greater ROI."Those marketers who aren't interested in online may be out a job - soon - if they don't prepare to

engage the empowered consumer." - Richard Tobaccowala, Group EPV, Starcom MediaVest

Reasons

for NOT

Measuring

Advertising

Effectiveness

Although measuring advertising effectiveness proved to be highly important, not alladvertisers evaluate their marketing techniques.

.

Reasons why companies often DON'T measure Advertising Effectiveness:

1. Cost: the most common reason that companies provide for notmeasuring their advertising effectiveness is the cost of conducting ameasurement program. Often companies believe that the moneyused for measuring their advertising effectiveness can better spent oncreating more advertisements or improving their product. Althoughthis might possibly be true, lets consider the flip side; if the companydoes not measure the effectiveness of its current advertisingprogram, they will not know if this program reaches their desiredaudience, sends the desired message or meets its intended goals.Being able to increase the advertising budget or improve the product

will not help the company if the message is sent to the wrongaudience or if the message that is comprehended by the consumersis different from the message that the company intended to send. Asa result even the slightest evaluation effort can go a long way inensuring that the desired message is sent to the appropriateaudience and hence saving the company thousands if not millions ofdollars.

2. Research problems: As we will see in the sections to come, theevaluation process can be very complicated, time intensive andconfusing for a company that is trying to start such an effort. Inaddition, it can very difficult to isolate and evaluate the effects of onlyone of the companies marketing efforts; as a result managers oftencan not justify the costs if they cant pin point the contribution ofeach of their marketing efforts. For example, it might be very difficultto isolate the contribution of the companys banner ad program fromtheir overall marketing effort as a consumer might not necessarilymake a purchase based on what they see in banner ads, butconsider a variety of factors (brand image, pervious experience with

the company, or an on TV) when making a purchase decision.However, although it might be true that we cannot pin point thedollar contribution of one program, research can be used to evaluate


10/23

the communication, reach and other factors associated with each advertising method.

3. Disagreements on what, when and where to test: There are a variety of methodsused when determining what, where and when to measure theeffectiveness of an advertising program. Choosing theappropriate measurement method depends largely on theindustry the firm is in, the objectives of the program based onGOPST analysis and the person that will be analyzing theresults. For example, sales managers may want to measure thecontribution of the advertising program on sales, whereas top

executives may be interested in the effects of the program onthe companys image. These differences often lead to a greatdeal of confusion between the mangers and might lead them toabandon the evaluation program altogether. However, there isno rational reason for this conflict as we will later see, each ofthe measurement tools work to achieve a different objective.

Whatto Test

While putting the campaign together, the advertiser must focus on what he/she shouldtest.

Factors that should be tested during the evaluation process:

1. Testing the Method: as we have previously highlighted there are a variety ofmethods to advertise online, choosing the appropriate method will have a substantialimpact on its success. Therefore, it is important to determine how well the chosenprogram is working and to measure its performance against a predetermined standard.The testing process should consider the following aspects when choosing which method

will be the most effective.

a) Advertising Method (ex: SEO, Banner vs. sponsorship)

.

b)Subclass (ex: regular vs. content sponsorship)

.

c)Location (ex: Banner at the top or Sky-Scraper on the side)

.

d)Time (ex: pre or post product release)

.e)Size (ex: Pop-up (full page) or Banner (small bar at the top of the

page))

.f)Vehicle Option Source Effect


11/23

According to Advertising & Promotion texbook, Vehicle Option Source Effectis thedifferential impact that the advertising exposure will have on the same audience member

if the exposure occurs in one media option rather than another.(p. 454).For example, how will the same consumer perceive the same ad, if it is viewed in abanner ad vs. a pop-up ad. Some of the advertising methods have predeterminedemotions associated with them (ex. pop-ups are perceived to be annoying), thus theadvertiser must consider the emotional impact of the chosen method when making theirdecision. Thus, the advertiser must consider all aspects and options of possiblemethods before coming with a conclusion as to which method will be the mostappropriate.

2. Testing the Content:

When an advertiser is developing a new ad or evaluating a current one, he/she mustalways start with an intensive analysis of the objective of the ad: its intended meaning,its desired effect on the consumers, the demographic of these consumers and itsdesired effect on brand image. Once these factors have been outlined they will serve asthe standards by which the content of the ad will be evaluated. For example, if the

intended objective of an ad is to get consumers to try a new product that is beinglaunched, the marketers might test the following:

a) If the ad is effective at getting the consumers attention

.b) If the ad is informative enough to allow the consumers to evaluate the

product

.c) If the ad is persuasive enough to convince the consumers to try the

product

.d) If the ad is memorable as to ensure the consumers will remember to

make the purchase

.

e)If the ad is appealing to its intended target market

.f) If the ad has the desired effect on the brand image (ex: if the ad isconsistent with the companys other marketing efforts)

Key

Points:As we just saw, choosing the most appropriate ad requires more thanjust choosing the most attractive one, the most appropriate ad must be ableto meet all objectives set out by the company, communicate the correct

message, be appealing to the target audience and be consistent with thecompanies other marketing efforts.


12/23

3. Testing the Budget Decisions:

Finally, the advertisers often try to examine effects of their budget decisions on the ads

effectiveness. Some of the common questions asked here are:

a) Is the budget allocated to this ad campaign appropriate for its size?

b) Will a larger budget increase sales?

c) Is the allocated budget greater than the anticipated sales?

d) Should more money be spent in enhancing the current campaign?

It is important to note that using sales as the predominant evaluation criteria is notalways the most effective way of measuring the success of an ad campaign as otherfactors (Product, Price, Place) strongly influence the effectiveness of the chosenpromotion method. A more effective measurement method should include thepredefined objectives set out for the ad campaign not just its effect on sales.

Where

to Test

After discussing why we should measure advertising effectiveness and what to test thenext section will discuss where the testing should occur.

Places for testing advertising effectiveness:

1. Laboratory Testing: In a lab testing environment, participants from the target marketare brought in to be asked questions about the ad or to evaluate their reaction towardsit. These questions and reaction measures will be used to evaluate the ad based on the

predetermined criteria mentioned earlier.

.The major advantage of using this type of testing environment is the control it providersfor the researchers. In this environment, researchers can easily manipulate each aspectof the ad (colour, size, format, etc.) to be able to examine the effectiveness/contributionof each of these characteristics. After examining the effectiveness of each of these

aspects, the advertiser can choose ones which will be the most effective for the ad.

.The major disadvantage of using this type of testing environment is the lack of realism.

According to the advertising and promotion book, when people are brought into a lab(even if has been designed to look like a living room) they may scrutinize the ads muchmore than they would at home (p. 456). Regardless of the lab layout, informing the

participants that they will evaluate a particular car may lead them to feel that they areprofessional judges for the ad. This may result in the participants over analyzing the ad


13/23

and leading to a variety of testing biases. Regardless of what happens in the lab, thepurpose of the evaluation process is to predict the target markets reaction to the ad in itsnatural environment (at home, in the office) and duplicating these environments may

be impossible in a lab setting. Often, it is felt that the benefits of lab testing outweigh thedrawbacks, and lab testing should be strongly considered in the evaluation process.

2. Field Testing: As mentioned earlier, the major drawback of lab testing is the lack ofrealism, and field testing bypasses this drawback by testing the ad in the environment itwill be viewed in including all the competition, distraction and comfort associated withthat environment. For example, in a field test, researchers might go out to the

participants homes or offices and observe their reaction to the ad.

.The major disadvantage of field testing is the lack of control. Using this method may notgive the researchers enough information as to be able to specifically link the causes ofthe participants evaluation to particular aspects of the ad. In other words, theparticipants may evaluate the ad based on factors outside the attributes of the ad itself(their mood, feelings towards the company, feelings about the competition, etc.). As aresult, field testing may provide biased results as it does not provide the researcherswith the control as to be able to isolate external factors from the participants true

feelings about the ad.Overall, the researchers must ultimately evaluate the trade-off between control andrealism when making a decision as to which evaluation method will best meet their

needs.

.Furthermore, the allocated budget for the evaluation process may play a significant rolein determining which method will be used. If the marketer allocates a large budget, hemay choose to use both methods as to gain from the benefits of each one. However ifthe allocated budget is very restrictive, the researchers may opt to use the lab testingmethod as it is associated with lower costs. Field testing often requires a largerinvestment of time and money, since it costs more for the researcher to go out on thefield and meet with the participants individually rather than evaluating everyone at thesame time.


14/23

When

to test

Evaluation of advertising tests may be conducted prior to putting the ad online or after.This section explores different methods of pre-testing and post-testing.

1. Pre-testing: actions taken before the campaign is executed.

"DigitalLink will allow will allow clients and their agencies to review the effectiveness oftheir online advertising creative before they launch a

campaign." Source:http://dynamiclogic.com/na/pressroom/releases/?id=381

Methods to test consumer's reaction are:

Comprehension and reaction testing: a key concern for the advertiser is
http://dynamiclogic.com/na/pressroom/releases/?id=381http://dynamiclogic.com/na/pressroom/releases/?id=381http://dynamiclogic.com/na/pressroom/releases/?id=381http://dynamiclogic.com/na/pressroom/releases/?id=381http://dynamiclogic.com/na/pressroom/releases/?id=381http://dynamiclogic.com/na/pressroom/releases/?id=381


15/23

whether the ad conveys the meaning intended. Another concern is theconsumer's reaction to the ad.

.Comprehension and reaction tests are designed to assess these responses.Personal interviews, group interviews, and focus groups have all been used forthis purpose.

Sample questions asked to consumers are:

1. Which ad did you find most interesting?2. Which of these ads would interest you the most in clicking on it?3. Which layout do you think would be most effective in causing you

to buy?

While this method offers control and cost effectiveness, there aredisadvantages which limit its usefulness:

4. Consumer may become self-appointed expert-- sometimes,knowing they are being asked to critique ads, participants try tobecome more expert in their evaluations, paying more attentionand being more critical than usual. The result may be anevaluation on elements other than those planned.

.

5. Halo effect-- sometimes participants rate an ad good on allcharacteristics because they like a few and overlook specificweaknesses. This tendency (halo effect) distorts the ratings.

.

6. Preferences for specific types of advertising may overshadowobjectivity-- ads that involve emotions or pictures may receivehigher ratings or rankings that those employing copy, facts, orrational criteria. Even though the latter are often more effective,they may be judges les favorably by participants who preferemotional appeals.

So how can these problems be solved?

Some can be remedied by using ratings scales instead of rankings. Burratings are not always valid either. Thus, while consumer juries have beenused for years, questions of bias have led researchers to doubt their

validity. As a result, a variety of other methods are more commonlydisplayed.


16/23

Physiological Measures: this involves a laboratory setting in whichphysiological responses are measured. They indicate the receivers involuntaryresponse to the ad and thus, eliminating biases associated with the voluntary

measures reviewed to this point. This includes:

1. Pupil dilation- designed to measure dilation and constriction ofthe pupils of the eyes in response to stimuli.

.Dilation is associated with action; constrictioninvolves the bodys conservation ofenergy. Advertisers have used this to evaluateproduct and package design as well as to testads. Pupil dilation suggests a stronger interest

in an ad or implies arousal or attention-gettingcapabilities.

2. Eye tracking- viewers are asked to view an ad while a sensoraims a beam of infrared light at the eye and follows the movementto show the spot on which the viewer is focusing. This shows howlong the viewer is focusing on each image and the sequence ofviewing. Eye tracking can identify strengths and weakness in anad. For example, background action may distract the viewersattention away from the brand being advertised. The advertiser canremedy this distraction before fielding the ad.

Key

Points:Pretesting can help companies improve their ads and save them moneybefore it is too late. However, many marketers the skip pre-testing becausemany believe being first in the market offers them an advantage overcompetitors, so they forgo the research.

2. Post-testing:occurs after the ad has been in the field. It is designed to determine ifthe campaign is accomplishing the objectives required and to serve as input of how wellits doing.

Inquiry tests: designed to measure advertising effectiveness on the basis ofinquiries generated from ads appearing in various print media. The inquiry maytake the form of the number of coupons returned, phone calls generated, ordirect inquiries through reader cards. For example, if you called in a response toan ad recently, perhaps you were asked how you found out about thecompany/product or where you saw the ad. This is a very simple measure of theads or mediums effectiveness.

More complex methods of measuring effectiveness through inquiries may


17/23

involve:

1. Running the ad by time or day of the week can help managereach.

For example, Yahoo movies section receives highest audience on

the weekends.

2. Running split-run tests: in which variations of the ad appear indifferent websites, targeting different audience which examinesspecific elements of the ad or variations on it.

For example, company places same ad in different industries andmeasures the frequency of visitors.
http://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdf


18/23

Recall tests: traditional interviews with Web users help determinerecall and whether viewers remember the ads they see, as well aswhether there is a halo-effect among ads. Scores are based on

percentage of respondents who can accurately recall the ad, ideacommunication, and likelihood of purchase.

However, many researchers find faults in this type of test due to:

o False claiming: respondents may claim to have seen an ad whenthey did not. This may be a result of having seen similar adselsewhere, expecting that such an ad would appear in the medium,or wanting to please the questioner. Interest in the product

category would increase reporting of ad readership. Whether thisfalse claiming is deliberate or not, it leads to an over-reporting ofeffectiveness.

o Interviewer sensitivities: any time research involves interviewers,theres a potential for bias. Respondents may want to impress theinterviewer or fear looking unknowledgeable if they continuallyclaim not to recognize an ad.

o The readers degree of involvement with the product:This inaddition to the distinctiveness of the appeals and visuals may leadto higher-than-accurate recall scores, although in general themethod may lead to lower levels of recall than actually exist.

QuantitativeMethods

Measuring the effectiveness of the internet is done by variety of methods, most ofwhich can be done electronically.

Exposure Measures:

.The following measures assess the amount of exposure of the Web content throughtheir interaction.


19/23

Hits: The number of times that a specific component of a siteis requested.

Since perhaps 5 out 6 "hits" are for graphic images, thenumber of "hits" can be grossly misleading. Usually peoplemean by "hits" the number of times a webpage has beenseen, but to be precise, the better term is "page views" or

"page impressions."

Page impressions or Page views: the number of times a webpage has beenrequested by the server
http://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.wilsonweb.com/articles/bannerad.htmhttp://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.wilsonweb.com/articles/bannerad.htmhttp://www.doubleclick.com/us/knowledge_central/documents/RESEARCH/dc_bpwp_0605.pdfhttp://www.wilsonweb.com/articles/bannerad.htm


20/23

Banner views: the number of times a banner has been viewed. Almost the

same as "page views," but some banner server programs don't count thebanner view unless the visitor stays on the page long enough for the banner tobe fully downloaded from the banner server.

CPM: A metric from the print days of advertising, meaning "Cost PerThousand," using the Roman numeral "M" to stand for one thousand. A price of

$15 CPM means, $15 for every thousand times a banner is displayed.

Creative: "Ad-speak" for the actual banner graphic.

Click: When a visitor clicks her mouse on a banner ad, she is transferred to theadvertiser's site. The number of responses to a banner ad is sometimes

refereed to as the number of "clicks".

Click Throughs: Same as "click," commonly used to count the number ofvisitors who click on the banner and are transferred to the advertiser's site.

Click Through Rate (CTR): The percentage of click throughs to banner views.A 1% CTR means that 1% of each 1000 banner views (or 10 visitors) haveclicked through.


21/23

Conversion Rate: The percentage of shoppers in an online store who actuallymake a purchase. This is typically 1% to 5% in online stores, but can be loweror higher.

Cookies: Small files written to your computer when you view a banner ad, visita website, or put a product in a shopping cart. This helps the banner server tokeep from showing you the same ad, or perhaps show you ads you might bemore interested in seeing. Cookies are controversial, but are here to stay; too

much of the Web is run by cookies to get rid of them. Cookies also allow anadvertiser to track which banner ad a visitor saw that brought him to the
http://www.icsc.org/ecommerce/chart6.jpghttp://www.escalate.ca/news-003/july-28-2004-001.gifhttp://www.icsc.org/ecommerce/chart6.jpghttp://www.escalate.ca/news-003/july-28-2004-001.gif


22/23

advertiser's site, and which banner ads resulted in actual sales.

Run of Site (ROS): Refers to displaying a banner ad throughout a website or abanner network with no targeting by keyword or site category. Run of siteadvertising costs substantially less than more targeted advertising

Processing and Communication Effects Measures:

1. Online measuring: firms are developing methods similar to those found inother media to measure demographics, psychographics, location of Webaccess, media usage, and buying habits. Clients can determine who saw theirads, determine reach, and ascertain whether the right target audience wasreached. Advertisers can test the impact of their messages, receiving a reportdetailing impressions and clicks by time of day and day of the week.

2. Non-response: measures are being developed to determine where consumersgo once they have been exposed to an advertisement but decide not to click on

it.

3. Surveys: surveys research, conducted both online and through traditionalmethods, is employed to determine everything from site usage to attitudestoward a site.

(confirmit.comis an example of a website that implements advertising

effectiveness surveys)

4. Panels: adapting traditional panel research is the focus of some firms thatprovide information on demographics, unique users, frequency of visitors, pagesreviewed, and how long a viewer stays at a site (stickiness)

5. Sales: a prime indicator of effectiveness is the number of sales generated.Adding information regarding demographics, user behaviours, and so on, can

increase the effectiveness of this measure.
http://www.witiger.com/ecommerce/confirmit.comhttp://www.witiger.com/ecommerce/confirmit.comhttp://www.witiger.com/ecommerce/confirmit.comhttp://www.witiger.com/ecommerce/confirmit.com


23/23

6. Tracking: some companies now provide information regarding site performance(downtime, speed, and so on) as well as analyze shopping patterns, tyingdemographic information to site activities, frequency of hits number of repeatvisitors, etc, to assist advertisers in developing more targeted and effectivemessages. The information can also be used to measure the effectiveness ofsite content by determining how many visitors access the content, how long theystay there, and how many pages are read.

measuring online ads

Documents