3 Ways To Rethink ROI
The advertising industry has been talking for years about the need to toss last-touch attribution on the trash heap of ad performance measurement.
And yet, although advertisers have started to rely on more nuanced models, this flawed measurement mechanism, which gives full credit to the final touchpoint, continues to persist.
But the technology exists to give ad buyers more well-rounded, nuanced techniques that show true return on investment and prove the impact of advertising on business growth and revenue.
What’s required now is a shift in mindset.
And with third-party cookies on their way out, there’s never been a better time to break the addiction and move on from last click to measurement that acknowledges the complexity of the entire digital customer journey.
Here are three ways to jettison old-school thinking and get a more holistic view of campaign performance.
Clicks and views look good on paper, but they’re usually not much more than flimsy proxies.
Truly measuring success requires an understanding of incrementality and attempting to answer the age-old question of whether revenue lift is actually tied to advertising spend.
Sophisticated marketers know this, and they’re increasingly seeking ways to understand the impact of their ad investment.
In a nutshell, incrementality testing, sometimes referred to as lift testing, allows advertisers to measure the causal impact of their marketing by splitting their target audience into a control group that isn’t exposed to a particular campaign or tactic, and a test group that is. The difference in conversions between the two groups can help advertisers understand whether their campaign actually drove those sales or whether the sales would have happened regardless of ad spend.
Incrementality testing is not a perfect science, but it’s a powerful tool that can help marketers make smart decisions and guide their spend toward campaigns and channels that deliver the best results and real ROI.
Get in the loop
Connected television (CTV) is the perfect proving ground for the power of incrementality measurement.
The rise of streaming and the shift in consumption from linear to CTV, which has only accelerated during the COVID-19 pandemic, gives advertisers the ability to combine the premium nature of an ad experience in the living room with all the advantages of digital and programmatic, including personalization, targeting and more granular measurement – even though most of the ads aren't clickable.
Through CTV, not only can advertisers attain incremental reach beyond their linear buys, they can also retarget consumers in a high-quality viewing environment and measure the full-funnel impact of their TV ads in real-time.
There’s no reason to revert to last click when it’s possible to measure CTV campaign performance alongside the performance of other channels and to finally draw a dotted line between the impact of TV commercials and whether they’re helping to actually drive revenue.
Cast off cookies
There’s also no reason to lament the end of third-party cookies, which underpin the practice of last-touch attribution.
Yes, losing third-party cookies is extremely disruptive to the status quo and it might in the short term even cause some advertisers to fall back on the ease of last-click attribution.
But the demise of third-party cookies is also an opportunity to find creative solutions, that are both more accurate and more in-depth, and finally pull the ripcord on outmoded practices.
Platform-independent universal IDs, of which the open source Unified ID 2.0 initiative is one example, set the stage for more secure data sharing across the supply chain and for more robust measurement across channels without reliance on cookies.
Although it’s still unclear exactly what digital advertising will look like in a post third-party cookie world, a consented cross-publisher ID that can be used to accurately target, frequency cap and measure campaign ROI across publishers and channels is just one of the reasons why it’s exciting to be a marketer in 2021.
So, what are you waiting for?