NONE: ONLINE-ADS>> WEB-AD'98 COVERAGE: 3/5/98 - What's a Click Worth?,
ONLINE-ADS>> WEB-AD'98 COVERAGE: 3/5/98 - What's a Click Worth?,
richard_at_tenagra.com
Thu, 5 Mar 1998 10:05:13 -0600 (CST)
rpt #8
Sender: owner-online-ads_at_o-a.com
Precedence: bulk
Web Advertising '98 Email Coverage
What's a Click Worth?, rpt #8
March 5, 1998
This is the eight in a series of 10 reports from Richard Hoy, who
covered the Web Advertising '98 conference in New York February 2 - 4.
You will receive these reports in addition to your normal Online Ads
posts/digests.
This coverage is archived at:
http://www.o-a.com/webad98/webad98-archive.html
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This conference coverage is generously underwritten by:
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Looking for the Web's most active hardware and software buyers? Wired
Digital's Webmonkey Network delivers IT/IS Decision Makers! Get
advertising info at http://www.hotwired.com/info/sponsor/ or
email rick_at_wired.com.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Sponsored by:
Wired Digital's Webmonkey Network - http://www.webmonkey.com
Looking for the Web's most active hardware and software buyers? Wired
Digital's Webmonkey Network delivers IT/IS Decision Makers:
60% are involved in software adoption decisions, 70% recommend or
buy hardware, 31% have purchased hardware online. For advertising
information, go to http://www.hotwired.com/info/sponsor/ or email Rick
Boyce at rick_at_wired.com.
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What's a Click Worth?
Larry Nelson, Anderson and Lembke
Robert Olson, Virtual Vineyards
Ali Partovi, LinkExchange
Jim Waltz, DoubleClick
Four panelists gave their views on what a click is worth.
TESTING, TESTING....123
Anderson and Lembke's Larry Nelson when through Microsoft's
campaign for FrontPage 1.1, an HTML authoring tool. The
whole campaign was focused on getting the prospect to
download a free trial version of the software. Roughly 20
percent of the budget was allocated to online advertising
and direct email, with the remainder going to print
advertising. They were able to attribute 54 percent of the
downloads to the online component of the campaign. Total
return on investment was 300 percent. (No hard numbers were
given, unfortunately. Just percentages.)
A significant percentage of the FrontPage 1.1 downloads came
from international domains (35 percent). And significant
percentage of those from an .EDU domain who downloaded the
product actually bought the full version. Anderson and
Lembke used these and other results to refocus the campaign
for FrontPage 98, the next version of the product. The
refocusing paid off. Anderson and Lembke was able to get
more sales of FrontPage 98 the first month of the new
campaign than were ever sold during the whole campaign for
FrontPage 1.1.
Larry made a good argument for running a test campaign
before you spend your real money.
PR CRUSHES ADVERTISING
But not everyone is selling product with online advertising.
Like a hard slap across the face, Robert Olson of Virtual
Vineyards delivered evidence that Virtual Vineyards' public
relations efforts have done far more to drive sales than any
online advertising.
Of the total traffic Virtual Vineyards got in October of
1997, only 16 percent was the result of banner advertising.
Only 9 percent of first-time orders were attributed to
banner advertising. And only 3 percent of overall orders
were the result of advertising.
Virtual Vineyards is able to track a person from when they
click on the creative to when they complete the order. This
ability has given them great insight into what it costs to
convert a prospect into a customer. And moreover, how to
effectively spend the little ad dollars that they do.
A very revealing trend that emerged from their analysis is
that for Virtual Vineyards, the cost to convert a prospect
to a customer is significantly lower on low CPM buys than
high CPM buys. So much for targeting.
IT IS A FLOOR WAX AND A DESSERT TOPPING
The one point that kept coming up again and again at Web
Advertising '98 was this dichotomy of banners being both
direct response and branding vehicles. And moreover, it was
suggested that they can have his split personality at the
same time.
No one made this clearer than Ali Partovi of LinkExchange.
He debunked three myths of online advertising.
Myth 1 - the Web is a direct response medium only.
While it is true a person can go from awareness to
consideration to purchase every easily online, that is not
the only value online advertising has. Ali asked us to
consider the "Netscape Now" campaign - that little button
many people put on their home page to show their site was
optimized for Netscape. He took a straw pole and asked how
many in the room had seen the button before. Everyone in the
room raised their hand. He then asked how many people had
clicked on the Netscape Now button. A much smaller number of
hands went up. It was painfully obvious that there must have
been some branding going on.
Myth 2 - Web advertising is perfectly measurable.
Ali shared the results of a banner campaign LinkExchange ran
to recruit new sites for its network. He said they could
attribute 15% of the daily sign ups to people clicking on
banners. But he said a whopping 80% of the people signing up
when asked said they heard about the recruiting program
through banner ads. That is a big discrepancy that wouldn't
have been detected if all one looked at were the
click-throughs of the banner.
Myth 3 - click-through = success
Ali made a convincing case that you can do both branding
and direct response if you know how to balance both messages
in one banner. If your message is too much one or the other,
you are really just wasting impressions. As an example of
his point, he showed two banners - one with
"collectibles.net" on it and one with just the word
"collectibles." The difference in click-through was marginal
- .44%. But difference in branding was probably significant
because there was no indication on the second banner a site
called "collectibles.net" existed. His conclusion is that it
is ok to sacrifice click-through a small bit in favor of a
clearer brand message.
Ali offered a four-step process when creating a banner
campaign.
First, create the messages you want to get across, then rank
them in order of importance.
Second, create a "vanilla" banner design, and test each
message on that same design.
Third, once you have settled on the message, experiment with
the banner design.
And finally, experiment with where users end up within
your site when they click on the link. The home page may not
necessarily be the best place to dump them.
MAN CANNOT LIVE BY CLICK-THROUGH ALONE
The final panelist, Jim Waltz, made a good point about the
quality of traffic. He showed mathematically how a low
click-through rate with a high sales conversion rate can be
equal to a high click-through rate with a low sales
conversion rate. All this translates into what Jim termed
the conversion efficiency - how well a campaign performs
relative to the level of exposure it gets. It is a function
of the click-through rate multiplied by the sales conversion
rate. For example:
campaign A got a 20 percent click-through and a 0.5 percent
conversion rate. .20 X 0.005 = 1.00 conversion efficiency
campaign B got a 4 percent click-through and a 2.5 percent
conversion rate. .04 X 0.025 = 1.00 conversion efficiency
These campaigns really performed the same even though
campaign A got a much higher click-through.
His point - don't go by click-through alone.
Another interesting point Jim raised in regards to
increasing one's conversion rate was that the more a person
has to click to complete the transaction, the lower your
conversion rate. DoubleClick's stats indicate that a soft
offer forms page which is three clicks or less away from the
Web site point of entry will outperform a link straight to
the home page by 300 percent.
The moral of the story is keep the transaction as few clicks
away as possible from the banner.
This ends the eight report of Web Advertising 98. Stay tuned reports
nine and ten.
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======================================================================
This conference coverage is generously underwritten by:
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Looking for the Web's most active hardware and software buyers? Wired
Digital's Webmonkey Network delivers IT/IS Decision Makers! Get
advertising info at http://www.hotwired.com/info/sponsor/ or
email rick_at_wired.com.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Sponsored by:
Wired Digital's Webmonkey Network - http://www.webmonkey.com
Looking for the Web's most active hardware and software buyers? Wired
Digital's Webmonkey Network delivers IT/IS Decision Makers:
60% are involved in software adoption decisions, 70% recommend or
buy hardware, 31% have purchased hardware online. For advertising
information, go to http://www.hotwired.com/info/sponsor/ or email Rick
Boyce at rick_at_wired.com.
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richard hoy
moderator, online advertising discussion list
vice president, marketing and client promotions
the tenagra corporation
http://www.tenagra.com/
p: 281.480.6300 | f: 281.480.7715 | e: rhoy_at_tenagra.com
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