NONE: Re: "industry average" in click-through
Re: "industry average" in click-through
Scott Gilley (scott_at_puzzledepot.com)
Sat, 22 Jun 1996 12:39:06 -0500
>We recently had a potential large corporate sponsor tell us they
>expect 3-5% click-through performance and stated this was
>industry average. I've seen industry averages quoted much
>lower than this and with all the people who turn graphics off
>and the other anti-advertising press receiving coverage (i.e.
>software that filters out ads), I was wondering if this information
>is high. Would like to hear what others are considering
>"industry average" in click-through ratios to impressions or
>pageviews. Thank you.
>
>Kathleen McMahon kmcmahon_at_wwwomen.com
>WWWomen http://www.wwwomen.com/
The data I've seen posted along with my personal experience with both
hosting and placing banner ads in the range of 468 pixels wide by 60 pixels
high indicates a general response range of 1% to 2% for click-thru response
ratio. This applies to a "semi-targeted" host site that at least deals with
the general subject of the banner sponsor site.
We've been hosting a well-targeted banner ad that matches our puzzle
oriented audience which has been generating closer to 20% click-thru ratio,
but I would say this response is quite atypical. BTW, we host this one
based on a per click-thru response basis and not a simple ad impressions
delivered model.
I would guess that most sites cannot expect to sell low cost items (under
$30 or so) based on a 1% or 2% response rate at the industry standard ad
impression cost model of $20 to $50 per 1,000 impressions. This gives an
actual cost per visitor of $2 to $5 ( $.02 / 1% or 2% ) and of course there
will be a site specific conversion ratio of sales to visitors to consider on
top of this.
If you assume a sales conversion ratio of a realistic 2% range and the above
$2 per visitor cost, you'll quickly go broke at a cost of $100 per $30 sale
(unless you count on repeat sales):
Per Sale Ad Cost = ($2.00 per visit) / (.02 sales/visit)= $100
Now if you consider a $0.15 per click-thru ad cost model, things look quite
a bit more feasible:
Per Sale Ad Cost = ($.15 per visit) / (.02 sales/visit)= $7.50
This expense leaves a bit of room for product wholesale or production costs,
fulfillment costs, overhead, etc... I would strongly suggest asking for a
free ad trial period for any marketing manager considering placing ads on
general content type sites. Otherwise, the numbers indicate you could take
a big loss quite quickly on a general search engine site (I don't have
figures for keyword results page ads). Smaller sites or ad network agencies
offering a targeted audience should give a much higher response rate and
will be eager to service your ad update requests.
Of course, selling ads on a click-thru basis requires that the host site be
quite selective in choosing their sponsors. Otherwise, a poor ad response
rate gives low return income due to fewer click-thrus. I have only been
hosting one such ad, and the sponsor offers a free software trial download.
I will stay with such "freebie offer" ads for a click-thru model since a
visitor will be more motivated to respond. Alternatives for actual
merchandise would be free giveaways based on a raffle drawing of visitors
who register for future email list news from the sponsor site.
I've seen several articles comparing the Pros and Cons of both ad payment
approaches. My feeling is that an ad impression cost model of $20/1,000 (or
higher) will simply not work for small to medium sites with one or only a
few products for sale. The numbers above show it will simply not work using
real life response rates.
To this point, our own site advertising approach has been to establish free
reciprocal links as far and wide as possible. The ad impression model will
not work for us with a $34.95 software product and average 2% actual sales
per visitor response rate. Just my ".02/impression's worth". :-)
I'd be happy to discuss ad hosting arrangements for those of you with Games,
Puzzles, Intellectual or Education products on a click-thru response basis.
(shameless plug)
Scott Gilley Pinnacle Solutions, 1001 Cassandra Ave
scott_at_puzzledepot.com Huntsville, AL 35802 ph: 205.532.1024
http://www.puzzledepot.com (Crosswords, Puzzles, Trivia Contests)
Create Custom Crosswords For Education, Web Sites, Newsletters
