Stemato.com - Stephen Tompkins’ Blog

Recently, I was reading an article in AdAge about a new study Google conducted attempting to show the relevance of its Content Network. The article states that nearly 20 percent of clicks coming from over 25,000 advertisers  and representing some 7 billion clicks were from the Content Network. With 20 percent of clicks going into display advertising, I cannot help but wonder what does the massive amount of money going to search ultimately mean to the online advertising landscape.

Is search the ultimate conversion driver? And does it justify the uneven amounts of money flowing into it?

Without showing the inherent role of assisting search that display and rich media assets play in the online advertising funnel you are missing part of the equation. In fact, I read an article today that emphasizes the point that most planners still view search and display as separate entities. This seems like backwards logic in today’s integrated online world. With so much Research available online that shows search and display together can lift your online performance planning these together becomes crucial. In fact, marketers are leaving money on the table when they view campaigns as separate entities.

A quick look at estimated advertising spend from analysts would appear that search alone can conquer the web without any help from display. But the truth of the web is that conversions are varied and full of many different intents and assisted from various angles. One conversion could be from search and another from email marketing. The reality is that both users were exposed to some form of branding before they actively engaged your product.

The realization that search and display work together will be a fundamental element of planning’s evolution. Furthermore as marketing progresses on the internet expect planners to begin integrating these processes much more.

Disclosure - I work for Microsoft Advertising’s Atlas Media Console.

Last week was my birthday so I am going to go out on a limb and announce: CPM’s are useless gauge only half the story online! ( I know you have heard that before but it remains true today as it was yesterday. And no one has come up with a comparable metric to challenge it. I can see my ex-colleagues at Nielsen rolling their eyes and saying the “time spent” conversation was soooo last year.)

Why are CPM’s a poor indicator of success online?

To answer that question, we first need to talk about where the CPM originated. Their origin was in print media allowing publishers to price their inventory and maximize exposure to their assets for advertisers. In short, publishers needed a way to show advertisers they were getting tons of “bang” for their buck and the CPM was born. That was all nice when you are dealing with something like newspapers and the limited metrics available to track exposure. But with online-advertising you have the ability to track in ways not available when the CPM was invented.

Pew research states that, “Fully 80% of Generation X internet users buy products online, compared with 71% of internet users ages 18-32.” With so many folks buying stuff online and searching for product information before they make the purchase, its a no-brainer to be online. In fact, the internet has become an unprecedented tool for reaching your customers. With tools such as advanced log files, marketers can now know more information than ever about the habits of the folks buying from their sites.

We can segment, re-message and apply any number of methods to the way media is delivered based on the personal histories of each viewers PC. But unless we make impressions count its useless. Instead of blasting out millions of impressions, we should attempt to blast out thousands of impressions to the right computers improving ROI and many other metrics.

Furthermore, these meaningful impressions are not blind attempts but based on actual recorded habits and can be applied in real time. With these types of advanced functionality it becomes even more important to stop our dependence on mindless blasting of users as possible and hoping one of them sticks. Its archaic methodology applied to a sophisticated system and its exacerbating banner blindness. The future is about making every impression count.

Police use fingerprints, DNA and other clues to assist in tracking down the perpetrators of crimes. Doctors use journals, colleagues, and workshops to successfully treat patients. Farmers use weather history, soil conditions and water to determine the future crops. Every occupation has its tool set and the more we evolve the more our tools for success become diverse and varied and online marketing is no different.

With this in mind, I started to think about the current model for online display ads. Where will it evolve? How will the tools effect the future? One thing is certain, if publishers continue to flood the market with a glut of inventory and continue this inflationary effect. CPM’s will continue to plummet. And publishers will fight for pageviews (probably the wrong success metric) in an overcrowded market.

CPM’s are plummeting and clients are demanding better ROI; online advertising has reached an important crossroads. The questions on everyone’s minds are. Will it face similar struggles as offline ads or will it adapt and reach its full potential? The answer to me is the whole model is broken.

Here are a few areas I think should first be examined:

#1 - Ad positioning on the page - Currently, ads seem to populate the side margins and boxes within the content, continuing to fight a losing battle with the content. Search ads were able to differ from display because they match intent with ads. If display could re-engineer its thought to match intent with content they could improve performance.

#2 - Networks/inventory - Networks need to become more transparent and let marketers know when and where they are placing ads. They also need to consider a body that can determine standards on volume and pricing similar to the IAB’s ad size standards.

#3-Targeting tools - Publisher-side targeting tools need to be greatly improved to help marketers reach the right person on the right page in the right spot. How many times do you see ads not matching the content, demographic and user? If pubs could come up with “smart-techonology” that identified layout, navigational flow and content they could better place the right ad in the right spot.

By introducing some of the above changes to the online world you would better improve the experience and performance of your media.  Can you think of some others changes that could improve the online-advertising model?

This post is long overdue but it’s still resonating in my head and therefore must be written (lol). A few weeks back, I penned a post about using the blogosphere to mine consumer-driven keywords from free text-analysis tools available on the web. In the post, I described the difference between what consumers say about your brand versus the internal verbiage used by employees and the ability to adjust search campaign spend appropriately based on consumers thoughts about your brand.

Its particularly interesting in the light of a May 19th post by Gerry Bavaro on the Mediapost Search Insider Blog. (here) In the article, he points out that analytics for search are one of the main factors of the rise of search and its huge spending forecast for the coming years.

I find it very interesting that when most people focus on the analytics of search they tend to look at the primary functions while completely ignoring the underlying causes. For example, we all get so focused on clicks we forget to wonder why someone clicks on a particular ad.

The psychology of the click is an integral part of understanding the nature of everything from visitors intent to consumers relationships with products. Why someone clicks, is the foundation of online advertising and could be considered the special sauce. It gives valuable insights into your brand’s position via the consumers mindset and motive when seeking out your services.

Lets face it, the closer you get to your consumer’s mindset, the better you will be in the long run.

I just read this interesting story from the NY Times about online ad spending and the economy. It basically says that display advertisement is down across the board and search remains strong. Its not super surprising to think that in a time of economic slowdown that search with its increased ability to track is weathering this storm well. But I am slightly caught off guard that display has had such significant declines in recent months.

The NY Times reported 16% growth this April compared to 20% last year making the slow down about 4% year-over-year. Not a major slowdown but still enough to be alarmed especially in a weakening market. Although its too early to declare an end to online advertisement’s growth, the companies that can better attribute steps in the online sales funnel to display, stand to gain a great competitive edge.

Yesterday eMarketer reported that online advertising spend is approaching 10% of all media spending and will be there by 2009. Considering the accountability, that digital commands and traffic quality it should come as no surprise that money is shifting to online at a quicker pace than other media. But what are some of the social media trends that this move will precipitate? Here are three that I think will be important part of my work here at Nielsen Online.

1 - Social Media become increasingly salient as connection hotspots - As trust continues to erode in traditional media, consumers will look increasingly to social media as a trusted opinion for all sorts of decisions, from which restaurant to eat at or what jeans to buy. Malcolm Gladwell describes, in his book The Tipping Point, “weak links” as influential to humans for making connections that make ideas tip. These individuals will become even more important as online migration triggers even more diverse and larger groups of connections who will exert overwhelming force over trends and ideas. (As I write this, I have over 100 twitter friends most I do not know but they shape many of my opinions on any number of things)

2- Brands continue to fortify their digital positions - With dollars shifting to the internet so quickly, brands will rush to keep up with the digital consumer migration. Brands will increasingly face the tough questions about social media and what they should do in this new platform based web. Corporate blogs are not for everyone but opening up the lines of communication can benefit brands. The question is, what is the best way to leverage social media, to empower your consumers and gain valuable insights.

3- Web trust factor becomes site currency - Inevitably, web sites will come that try to game the system and erode consumer trust in social media. From this, will arise a digital trust factor that will eventually become a web currency. It could come in an organized fashion or maybe it will just be semantic based - meaning you don’t travel far from home on the web. You have a few sites you visit and trust based on history, promotion and recommendations and only visit them frequently. This trend will hasten the move to platforms that portalize you to the web at large - Facebook applications are a good example of this in action.

As we see all media continue its move to digital, these three trends are one to watch. Any I missed?

Today on Armano’s blog he mentions something called “ambient interruption.” Its about the pervasive ever-present aurora of brands in the digital space. Its true that we are facing more subtle engagements from brands everyday. Email, display advertisements and search are all forms we experience on a daily routine. Our minds are able to block out many of them but they still seep into the brain.

All this “ambient interruption” has some interesting side-effects including subsurface recall. What is this? Today’s consumer is bombarded so frequently by messages that they are able to ignore most of these ads. But some are ignored at the conscious level and soaked into the subconscious for later recall.

These messages however sit inside the mind and can infect you at any time. Do you remember seeing and ad and wondering why it was astonishingly familiar? Perhaps because you have seen it before but blocked it out only to have it find it lodged in your subconscious.

Delta Airlines is now out of bankruptcy and looking smart with a new brand makeover. Despite the new look it seems to be business as usual at Delta as they disappointed me at a number of touch points this week. The first was a cynical interaction I had while taking the train to work.

The signs that line the top of the cars always strike my interest and I often wonder if they are effective. I can see some definite brand equity but not much ROI but that is for another post. This particular car was lined with Delta ads and I love to read headlines so I naturally read them. One said something about a flight you would want to spend extend. I get the irony of the ad but the core irony is that I was stuck on a Delta flight for 3 extra hours recently. I assure you I did no want another minute on this flight or any Delta one!

This ad was funny but to me it just underscored one of the worse aspects of Delta that you sit around and wait. What marketing genius came up with this one? The same guy that decided to market an automobile in a Spanish speaking country that was called Nova(or No Go)? Ha.

That was the first erosion of my faith in a brand that was badly damaged but slowly moving up. Second was when I tried to redeem a voucher given to me for volunteering to get off a flight. I decided to use the website to book a flight to Savannah but only to find that Delta made no mention of redeeming vouchers.

My inital reaction was to call and wait to speak to someone but I figured keep at the website. I continued to navigate through this site and eventually reached my limit. No mention of voucher redemption anywhere!

I called customer service and after 25 minutes of being on hold and being shuttled to different departments I was talking to a live person. She informed that delta.com was not Safari compatible! Can you believe that? No mention on the homepage of site requirements it took almost 30 minutes to find this out.

In today’s age of consumer empowerment, why are airlines consistently aloud to treat us as steerage class passengers with no consequence? I have to say some airlines do listen and they are getting it. (read JetBlue) Most though treat us as they want and we take it. I wonder how long this will last before they feel the backlash.

Delta, how long before you start listening?