Measuring Visitor Engagement Take Four: Ad Impressions

This is the fourth — and arguably most impor­tant — in a series of posts about the mea­sure­ment of online adver­tis­ing, and why I think time-spent-on-site, which I wrote about last time, is far from the panacea many believe it will be.

Now I come to impres­sions, a big ugly ele­phant in the room that’s been lin­ger­ing around for years…

When adver­tis­ers buy ad space, they actu­ally buy “impres­sions” more than any­thing else.  You are likely aware that this is called a CPM model — or cost per thou­sand impres­sions pur­chased. A $20 CPM rate sim­ply means it costs you $20 to buy 1,000 impres­sions on a site.

(Sure, there are other mod­els like CPC — cost per click — which is the stan­dard in paid search.  And there’s CPA — cost per acqui­si­tion — which resurges every now and again as an alter­na­tive but has yet to become main­stream for a vari­ety of issues.)

In any case, if you look at firms that use audi­ence mea­sure­ment ser­vices to deter­mine which sites they want to adver­tise on, it’s almost always based on CPM. This means that while unique vis­i­tors, time-spent-on-site, and page views are all well and good, in and of them­selves, they are sec­ondary met­rics when it comes to the true nuts and bolts of ad buying.

So iron­i­cally, despite all this media fan­fare about time-spent-on-site and the death of the page view, there is still a great divide between what adver­tis­ers and pub­lish­ers use to eval­u­ate adver­tis­ing oppor­tu­ni­ties and what they use to actu­ally exe­cute on those.

Audi­ence mea­sure­ment firms are pub­lish­ing sec­ondary met­rics that may help guide adver­tis­ers to a par­tic­u­lar site, but they are gen­er­ally dis­con­nected from the adver­tis­ing inven­tory itself.

Strangely enough, adver­tis­ers tend to pur­chase inven­tory based on a met­ric — impres­sions — that is rarely made avail­able to any­one out­side the com­pany.

To be fair, because adver­tis­ers often buy only a por­tion of avail­able impres­sions, you could argue that it doesn’t really mat­ter if they know how much total inven­tory a site can offer. For exam­ple, if a site has 10 mil­lion avail­able impres­sions, but you’re only in the mar­ket for 1 mil­lion, what does it mat­ter if they have 1 mil­lion avail­able or 10 million?

I believe it mat­ters for sev­eral rea­sons.  First, sat­u­ra­tion — if they have 1 mil­lion impres­sions and you want 1 mil­lion — that’s 100% of inven­tory. If they have 10 mil­lion, your 1 mil­lion only rep­re­sents 10%. Depending on your ad objec­tives, 100% sat­u­ra­tion or 10% sat­u­ra­tion may be more beneficial.

But with­out the total inven­tory num­ber, you have no idea.

Sec­ond, ad impres­sions can vary greatly by site.  This is because sites offer a vari­ety of ad place­ments for sale — often more than a dozen. From sim­ple home page ban­ners to run-of-site ads to stream­ing media pre-rolls, there is a myr­iad of place­ments adver­tis­ers can offer — and often, more than one adver­tiser shares a par­tic­u­lar place­ment, rotat­ing depend­ing on how many impres­sions have been served and how many have been purchased.

For­tu­nately the IAB has pub­lished — and con­tin­u­ally updates — ad place­ment stan­dards, so there is a gen­eral con­sen­sus as to dif­fer­ent place­ment types.  But there are no real guide­lines on how many or where these place­ments appear. For exam­ple, one site could have a sin­gle ban­ner avail­able on its home­page, while another could offer 10 place­ments, includ­ing one for stream­ing media.

Because unique vis­i­tors, page views, and even time-spent-on-site have a one-to-many rela­tion­ship with ad impres­sions, it’s impos­si­ble to use those base met­rics to even esti­mate impressions.

So take a step back, and a deep breath. If you’re with me so far, you’re prob­a­bly ask­ing why audi­ence mea­sure­ment firms don’t just pub­lish impres­sions in addi­tion to the other metrics.

Good ques­tion. One chal­lenge is that ad impres­sions are dif­fi­cult to mea­sure for audi­ence mea­sure­ment com­pa­nies.  An impres­sion can be gen­er­ated in mul­ti­ple ways; there are few “ad serv­ing” stan­dards.  And pub­lish­ers fre­quently com­bine sev­eral dif­fer­ent tech­nolo­gies to serve ads, often on the same page!

Even if ad impres­sion serv­ing tech­nolo­gies were stan­dard­ized, and the audi­ence mea­sure­ment com­pa­nies could track them, there is another chal­lenge (It’s some­thing I talked about before, in the sec­ond post of this series): Panel-based method­olo­gies are just not as good for gran­u­lar report­ing as are other method­olo­gies like web ana­lyt­ics.  And many ad cam­paigns are just that — gran­u­lar, tar­geted ini­tia­tives that are muted across user pan­els, if not alto­gether absent.

Fur­ther­more, ads often change by day — whereas most audi­ence mea­sure­ment com­pa­nies report weekly or monthly at best.

So don’t hold your breath on this one. I just don’t see it in the cards.

What should adver­tis­ers — and pub­lish­ers — do?

I think there is a sig­nif­i­cant oppor­tu­nity for adver­tis­ers and pub­lish­ers to cre­ate a more effi­cient mar­ket­place.  In turn, these effi­ciency gains should drive a bet­ter cus­tomer expe­ri­ence — as vis­i­tors enjoy a more rel­e­vant online (and offline) rela­tion­ship with vendors.

How?  Take back con­trol and set a new stan­dard that is publisher-centric.  Let me explain.

First, imag­ine a world where pub­lish­ers used web ana­lyt­ics to cap­ture ad impres­sions.  Since these impres­sions are mea­sured at the browser level, and do not even rely on cook­ies, they are arguably the most accu­rate mea­sure you can achieve for true impressions.

Sec­ond, imag­ine a world where pub­lish­ers also cap­tured clicks, and even “down­stream” suc­cess events (con­ver­sions, pur­chases, form com­ple­tions, etc.) that occurred as a result of those clickthroughs.

Finally, imag­ine a world where pub­lish­ers then pro­vided this infor­ma­tion to prospec­tive adver­tis­ers, who in turn could eval­u­ate if and to what extent they wanted to pur­chase that inventory.

A fairy tale, you say?  Nope.

The real­ity is that pub­lish­ers can do this today, and many are already doing some of it using web analytics.

At Omni­ture, we have already helped cus­tomers cap­ture impres­sions, in real-time, for their web­site and report those back to prospec­tive advertisers.

This approach also cap­tures any clicks that result from these impres­sions, and reports them back in real-time.

Of crit­i­cal impor­tance, it is pos­si­ble to seg­ment this impression-tracking with pro­file infor­ma­tion that cus­tomers vol­un­tar­ily and will­ingly pro­vide you, all accom­plished in accor­dance with your pri­vacy policy.

For exam­ple, you could see the geo­graphic dis­tri­b­u­tion of all peo­ple that clicked on one of your home page banners. Alternatively, you could report on adver­tis­ing and con­tent affini­ties that would actu­ally help you sell even more inven­tory on your site.

Tak­ing this con­cept even fur­ther, you could seg­ment ads, by demo­graphic infor­ma­tion that your customer’s have shared with you (and you have once again cov­ered in your pri­vacy policy). This would allow you to share gen­der, age, and income pref­er­ences with prospec­tive adver­tis­ers by each ad run on your site. 

And tak­ing it even fur­ther, you could use third-party data sources like PRIZM to aug­ment the data even more – which I can imag­ine would pro­vide some com­pelling multi-channel syn­er­gies given PRIZM’s preva­lence in the offline world.

From this point, the key is to estab­lish a vehi­cle or mar­ket­place by which you can share this infor­ma­tion with prospec­tive adver­tis­ers.  This could be done as a col­lab­o­ra­tive exchange between numer­ous publishers.

So for­get about tak­ing back con­trol from the audi­ence mea­sure­ment firms– you’re com­pletely chang­ing the game with this kind of data!  Exist­ing approaches can’t even scratch the sur­face when it comes to pro­vid­ing this kind of insight.  The depth, the speed, and the accu­racy are unparalleled.

Per­haps you think this is impos­si­ble; there’s just too much weight around the cur­rent approach.  Try telling that to Google, Yahoo, Microsoft or any other paid search engine.  They run their entire busi­ness on a model that’s not too dis­sim­i­lar from what I’m advocating.

Think about it. Why does this work only for CPC and search key­words?  While there are some nuances to pub­lish­ing that need to be con­sid­ered (as I’ve high­lighted above), it’s not rad­i­cally dif­fer­ent.  And paid search is a $7 bil­lion mar­ket — so the model has legs.

Is this approach with­out its chal­lenges? Of course not.  Stan­dards will have to emerge, dri­ven by gov­er­nance bod­ies like the IAB.  And that will hap­pen over time, just as it has for search.

But it won’t hap­pen at all with­out pub­lish­ers demand­ing a bet­ter mouse trap… a Brave New World, if you will.

So, long live the impres­sion! And if you have ques­tions about mea­sur­ing and opti­miz­ing impres­sions, I encour­age you to reach out to us.  We’d be happy to help.