Monthly Archives: September 2011

Imagine looking under the hood of a luxurious car and finding a labyrinth of copper pipes, valves and a steam engine at its core. Well that’s what you find if you dig deep into the inner workings of an ad agency. At the heart of media agencies where literally billions of dollars are being managed is DDS. Now there is nothing really wrong with steam engines, they are extremely powerful, reliable and simple which is why DDS holds a massive share of the market. There is not much reason to design the ultimate interface for a timesheet or a billing management system hence the reason why many people in the agency are content with using command line user interface software that looks like DOS 1.0. That is, until some kind of game changer comes from nowhere.

There are two kinds of transactions in media. The established way involves paper, phone calls, faxes and systems like DDS to manage and clear the bills. This systems is reliable and stable for the usual media buy which covers 10 – 50 different media suppliers.

Contrast that with how online ad networks are handling transactions. They are able to manage the buy/no buy decision with thousands of websites in the blink of an eye. Layer on top of that one of the players in online ad networks in Google which also brings in capabilities with ad exchanges in addition to Google Docs which offers an Excel alternative and you can see why DDS and MediaBank are nervously eyeing their business space and coming to the conclusion they need to work together.

There is much to clean up. Although ad networks make super fast transactions within their network, outside the network much of the transaction process is handled the old way. Thankfully the back office is getting some of the attention and investment it needs.

Google - the super power that still holds the strongest foothold in digital advertising revenue, left more than just easy-access search results for consumers.  For those of us in the advertising industry, Google set the foundation for how ads were bought and how we would ultimately measure their performance.

If you have ever thought of “What did we actually achieve” by way of digital advertising more than a few times during your careers.. well, Google may have held a critical role in the confusion surrounding how to best measure digital media.

I’ve inserted a great image (see below) that shows the timeline of Google’s development over the last decade. I love this chart because it not only helps remind us of where all this technology came from but also how quickly we got to where we are. For the purpose of this entry, look at when Search was launched (1998) and when DoubleClick ( a widely used technology platform used for serving display and video ads to digital consumers) was bought.

The introduction of digital media to many came in the form of Google Search Ads and it’s platform Adwords that would help manage it all.  It is relatively easy to set up search ads in Adwords and cheap to try for small, medium or large businesses. However, the underlying method to get the most “bang for your buck” on the platform involved getting a very high CTR (Click through rate) for your ads. The higher the CTR, the lower you paid. So, digital agencies and clients alike quickly became accustomed to Google’s Adwords platform and this method of determining the pass or fail of ads. However, the larger implications of this went unnoticed by the best of us. CTR quickly became confused as the measure to use if you’re interested in understanding the impact your ad on your brand. But, how many TV ads can we say have been a success or failure because of it’s click through rate?

In a short span of time, Clicks (traffic to website) and CTR became one of the most important delimiter for success and failure of online ads… not because it made sense, but because Google mandated this with their ad model. It also didn’t help that many networks quickly cropped up that sold their ads with a CPC (Cost per click) currency. The notion of CTR based optimization and media buying spawned and took a very strong foothold in the industry and in clients’ minds. Aside, I still work very hard today to clear this misunderstanding for my clients.

So what does it all mean?  While CTR can hold value for direct marketing objectives, it is hardly a good measure for success for branding objectives. At Media Contacts, we have started to incorporate technology that helps us measure the brand impact of ads close to real-time on campaigns. As well, other members of the advertising industry have also been questioning the efficacy of existing forms of measurement and have started to develop much more interesting and viable platforms of online measurement techniques.  One of the more notable studies in this field was recently conducted by Microsoft in conjunction with Neilson. It compares the impact of online video ads as related to brand measures.  A worth while read for those who believe there’s more to success than the click when it comes to digital advertising.

Download the Nielsen IAG/Microsoft Video Effectiveness Research Study

Enjoy!