CPM’s are Only Half the Story
Posted in ads, analytics, digital on April 16th, 2009 by Stephen Tompkins – Be the first to commentLast 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.
