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Number Crunching

Filed under: All Articles > Industry News
By: NMK Created on: October 5th, 2004
Bookmark this article with: Delicious Digg StumbleUpon

Does the wealth of information available about online advertising automatically give it an advantage over offline media? Possibly, says Michael Nutley of NMA, but we've a way to go yet.

One of the prevailing ironies of this sector is that the most measurable,
accountable medium ever developed is regularly castigated for the flaws in
its reporting methods and metrics. 

Some of the reasons for this are obvious. For example, confusion still
exists about the nature of server and panel-based metrics, and why they
give different results. We also have only ourselves to blame with the way
we've swapped between metrics, from hits to page views to clicks. And it's
only recently that we've had sufficient historical data to be able to make
meaningful assessments of the numbers we've been collecting. Before that
the medium was simply too new. As one US ad serving software expert put it
to me four years ago, "The great thing about new media is that we can
measure everything. The bad thing is that we have no idea what the numbers
mean".

Some of the reasons for the criticism are even justified, such as the
discrepancies around ad serving statistics that the Institute of
Practitioners in Advertising's Digital Marketing Group has been working
hard to address. But other reasons seem more spurious, and often smack of
panic on behalf of other, less accountable media.


A common response a few years ago, when click-through rates for banners
were falling, was to ask what the click-through rate for a poster was. At
the time it seemed simply a defence mechanism for embattled proponents of
online advertising, but it also neatly encapsulated the threat to offline
media, a threat which is now becoming increasingly real. 

What's driving this is the growth of integrated and media neutral
advertising. As the resurgence of online advertising continues, more and
more advertisers are seeing the wealth of detail that online can provide
about who saw which ad, where, for how long, and what action they took as a
result. That's leading them to ask for greater information from their
offline media channels. At the same time, for the value of media neutral
campaigns to be properly measured, and for the campaigns themselves to be
properly optimised, the metrics employed across all the media employed have
to be comparable. In branding terms this isn't so much of a problem. 

Metrics such as brand recall, brand favourability and propensity to
purchase can be measured robustly using the same methodologies offline as
on. It's when questions are being asked about more detailed
return-on-investment measures such as how many people saw a particular ad
that things get complicated. 

Only now the questions are being asked about old media rather than new, so
why should we be worried? They may have the big guns, but we've got the
numbers, right? 

Firstly our own house is still not in order. There's a lot of education to
be done about what should be measured and how. There's still more work
needed to educate potential clients about the various metrics, what they
mean and why they differ. And if we expect interactive media to become an
integral part of the marketing communications mix, we need to make sure
that we're speaking the same language as our offline counterparts. 

About the author: Michael Nutley is the editor of New Media Age.

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