August 29, 2008

How Engagement Should Be Measured

Filed under: advertising, analytics, creative, marketing strategy — Tags: , , — bstraley @ 1:59 pm

I had a conversation not too long ago with someone from a major advertising agency.  We were talking about the approach we take to quantifying user engagement online.

Engagement is one of those terms that means different things to different people.  For folks steeped in the world of offline media or the more traditional forms of online media (display/rich media ads), the term refers to time spent with a particular piece of content.  For example, a Web page on which a user spends over a minute on average would be considered highly engaging under this definition.  The inference in this case is that since the page is loaded for over a minute on average then that must mean the user is somehow engaged with the content.

Another, example of engaging content under this definition is a video that’s watched a million times.  In this example, the metric of views is a more active measure of engagement where presumably many hundreds of thousands of people (assuming some folks watched multiple times) took the time to watch.

Incidentally, here’s a highly, highly “engaging” video I was late to discover…

No doubt an amazing video and one worth sharing with friends which leads me to the point of this post.

Proxies for engagement like time on site and views are of limited value to marketers because we need to make too many assumptions about what was actually happening when the site was loaded in a brower or the video was played.  In point of fact, both of these metrics are measuring the opposite of engagement in that the actions they’re tracking are of the “lean back” variety.

At Reach Machines, we define engagement differently.  Engagement is about people doing things in pursuit of a goal.  Learning more, sharing opinions, distributing videos, creating content, etc.  On the Web , engagement is a creative process not a passive one.  Social media sharing tools and networks ensure that even when I’m in the process of searching for information or organization personal information, I’m interacting with services, apps, and platforms that are facilitating this process at the same time they’re capturing my process and data to enable the next person who’s headed down the same path to do so more efficiently.  See Jasaon Calacanis’s Mahalo for an example of how even the seemingly solitary act of searching is creating value for not only me as I search but also the others that follow in my path.

The metric closest to quantifying the somewhat amorphous notion of engagement is links.  Jeff Jarvis has written at length about this.  I did as well here in June.  Links are pointers to information that one person distributes to one more or other people via a variety of passive (blog, Facebook page, etc) and active channels (email, IM, SMS, etc).  When I copy and paste a link and send it along to people I know, I do this because I think they’ll find the information I’m sending to them a combination of useful, interesting, and/or entertaining.  When I copy and paste a link into a blog post or my facebook profile for example, I do it for reference and/or validation.  Active sharing v. passive sharing serve different purposes but they’re both reliable indicators of engagement because they both involve the act of creating a link and making it available for others to find and follow.

So, of the available metrics that online marketers use today, following are some of the ways to monitor and measure that number and velocity of the link creating that’s occuring online:

  • Search Engine Results Pages (SERPS) - Where your site appears in results for relevant keywords.
  • BackLinks - Go to Yahoo! SiteExplorer to get the number of backlinks for any URL
  • Bookmarks - Use the URL lookup feature at Delicious.  Here’s an example for the video above.
  • “Diggs” - The number of times your site has been “dugg”, the number of times a particular piece of content on your site has been “dugg”, etc.
  • Pass Alongs - The number of times your site/content has been shared with others through Web, email, IM, SMS, or other media.

The goal of any marketing campaign should be to increase the likelihood that individuals within the target market will purchse the marketer’s product/service.  True engagement of the sort I described above is a reliable indicator of interest which is a short hop from intent to purchase.  The sooner marketers and their agencies move away from tired and deeply flawed ideas around engagement that are informed by 50 or so years of attempting to reach an audience deeply immersed in the “lean back experiences” of watching TV or listening to the radio, the sooner they will realize, internalize, and adopt the metrics and strategies that really do work on the Web.  Campaigns that reach and key off of people when they’re leaning forward, searching, finding, consuming, creating, and sharing content and information.

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July 23, 2008

Why Marketers Need to Think and Act More Like CFOs

Filed under: analytics, marketing strategy, metrics, technology — Tags: — bstraley @ 10:24 am

The title of this post caught my eye the other day:

What Do You Do When Old Media Vehicles Are Losing Effectiveness And New Media Vehicles Are Not Proven And Generally Lack Measurement?

What’s interesting about it is the implication that “old media vehicles” can be measured effectively in contrast to the “unproven” online methods of today and tomorrow.

The author has it exactly backwards. The effectiveness of brand marketing via TV, radio, and print has never been something that could be cost-effectively measured. Even when metrics like “unaided awareness” are computed from costly survey data, one heavily discounts the value of this metric as a predictor of marketing spend ROI.

The ability to record, in theory, every impression and every action exists today on the Web, something never before possible with old media vehicles. As a consequence, the online advertising value chain can be constructed with far greater precision and at dramatically reduced cost than anything one could do with off-line media. The issue then isn’t that the data and metrics do not exist for marketers to quantify ROI and justify increasing spend on online marketing initiatives, it’s that “traditional” marketers and their agencies generally do not have the skills or experience required to construct the performance measurement and financial models that transform the presently available marketing data into information and knowledge that can be consumed and acted upon by upper management.

The fact is that the availability of all of this data is creating new responsibilities and opportunities for marketers to measure the effectiveness of their efforts, spot opportunities to increase performance, and optimize accordingly. This approach to marketing and promotion is in the DNA of every successful online merchant today starting with Amazon, Ebay, and Google. They measure and test everything they do and use the results to shape and guide their communications and promotions planning. It is also the way more and more boutique online advertising and marketing agencies combine the science and craft of marketing on the Web.

Going forward, marketing effectiveness will be driven by four things:

  • Strategy - The goals and objectives of the marketing plan must be closely aligned with the overall strategic plan of the organization?
  • Creative - The message, who it’s for, how it’s packaged, when/where it’s delivered, etc.
  • Technology - The effective use of technology to drive expanded breadth and depth (aka scale) of your marketing programs.
  • Management Methodology - Is everything being measured and is the data being transformed effectively into actionable information and insights?

Does your agency of record, or if you don’t have one the team you use internally, posses these three capabilities in sufficient strength to deliver the bottom line results your success requires?

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April 7, 2008

Longtail Ad Placements Lift Performance

Filed under: media planning — Tags: , , — bstraley @ 12:46 am

iMedia Connection has an interesting post about the value of vertical niche sites to online marketing campaigns. In the piece, Russ Fradin makes the excellent point that media buys that include a substantial number of niche sites can significantly improve campaign performance.

We couldn’t agree more as our flagship service identifies the richest marketing opportunities across the Web and through the tail.

A few comments on the underlying drivers of the changes that are necessitating a new, more nuanced approach to online media planning and buying:

1. Consumers are in control. They seek, find, and share valuable content on multiple sites and in a variety of formats. Oftentimes, the most engaging and popular spots are created by the audiences themselves: see MySpace, YouTube, Flickr, and Facebook.
2. Costs to produce and maintain sites and content continue to decline. As a result, barriers to create a publishing enterprise are insignificant.
3. Means of monetization are ubiquitous. Thanks to Overture, AdSense, and the too-numerous-to-name self-service ad platforms, it is possible for anyone to earn advertising revenue. I say possible because it’s a lot harder than it might seem to generate more than a few bucks a month in advertising revenue but that reality isn’t stopping millions from having a go.
4. Campaign measurement begets campaign management. Advertisers can now measure the effectiveness of a campaign down to the impression and can optimize accordingly.

Given these market dynamics, niche sites are a critical component of any media plan because they offer the best combination of relevant content and publisher incentives. The former is important because the relevance of not only the content but the site itself lends credibility to an advertiser’s message (provided the message is equally relevant). The latter matters because the greater the incentive for the publisher to run your ad, the more likely the placement will be cost-effective.

While there are significant structural and technological barriers to making it efficient to buy 100% of one’s advertising at the site level, planners need to be aware of the properties further down the tail that could move the needle for their campaigns. There are powerful incentives for doing so and using tools like Reach Machines to help them along the way.

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