Today no one can run from the economic downturn we are all facing. As the credit crunch continues to tighten its grip on the economy we are seeing advertisers demand more from every dollar they invest. In recent years we’ve seen the rise and rise of digital marketing as an effective way for brands to invest their dollars due to two key factors; the channel is the fastest growing on the planet and perceived level of accountability it offers. What is beyond me though is the lack of transparency and understanding most clients have around their digital investments and the blind faith they place in the reports they get from their media agencies. Without wanting to be alarmist most acquisition and engagement focused clients could save upwards of 30% of their digital display budgets with little or no impact what so ever on their campaigns performance. Even worse they can in most cases reinvest this wastage into performance based media and Search for a 50% – 200% increase in campaign performance.
The primary problem is most (not all) campaign performance reports delivered by media agencies use blended metrics of post impression vs. post click success events (CPA etc). In some cases I’ve seen this blended metric as high as 95% post impression and 5% post click. With cookie windows of up to 60 days this introduces a high level of bias into reports. But today the problem goes deeper, some digital media plans are unethically designed to introduce a cookie spraying methodology into the media plan. Cookie spraying is a deliberate tactic to buy as much low performing, low placement, cheap remnant digital inventory as possible. This type of media strategy can ensure upwards of 70% of an available Internet population ( e.g. Australian internet users) ALWAYS have a cookie on their machine. In some instances I’ve seen a single client drop 4 billion post impression cookies in a 12 month period, with only 13 million active Internet users in Australia you do the math. So a user may never ever click, engage or even see a brands ad, navigate to the brands site either by direct entry of another medium ( e.g. Search) and the value is attributed on a post impression basis to an advertising / media plan that had little or no effect on consumer behavior. Think how many times a consumer may visit a social networking site (www.facebook.com and www.myspace.com), use an IM program ( Microsoft Messenger, AOL Chat etc), use a free email service ( sponsored ad email) (Yahoo mail, Hotmail etc), or check the news or stocks from their favorite site. Every time they do this a cookie is dropped on a users machine.
The economic impact:
- Clients are relying on false or skewed data to make digital media investment decisions
- Clients are double paying for performance in some instances ( i.e. paying an affiliate commission, the cost of an impression or a Search click) – lack of ability to de-dupe
- Clients are missing their true value creation opportunity as their campaigns are being optimized and planned on fictitious data sets and not investing in high yielding digital media
- Some media agencies are falsely claiming media rebates and commissions they are not morally entitled to
- Some media agencies are doing this by deliberate design to meet their contract commitments to networks and publishers to gain OMI (other media income) and discounted wholesale rates that they mark up due to a group buy – all in the face of not operating in a clients best interest and not disclosing this as part of their strategy ( why would they?)
The impact on performance numbers
The impact on this practice on a clients performance numbers is significant. In some cases I’ve seen digital success metrics overstated by by to a factor of up to 20 times.
Industry Blended Metric Post Click Metric(actual CPA)
Telco $86 CPA $679 CPA
Credit Card $54 CPA $1894 CPA
Homeloan $205 CPA $29,452 CPA
- Base all value attribution ONLY to last cookie (last cookie should win in all circumstances)
- Understand the difference both post click & post impression metrics. A post click engagement is worth SIGNIFICANTLY more than an impression.
- Have a common cookie window policy across all digital mediums (display, affiliate networks, search etc)
- Understand conversion latency (time from click to conversion – they differ greatly between digital mediums)
- De dupe conversions / cookie pools etc
- Understand the consumer journey and what exposure a consumer has had to all digital advertising (what has lead to what)
- In the case of post impression metrics attribute value only within a very finite window ( i.e. 6, 12, 24 hrs from LAST impression)
- Apply a universal set of data business rules to digital value attribution
- Break down your media buy in transparent terms. Understand what components of the digital media buy is CPM, ROS (run of site) CPC, Remnant inventory etc. This will allow you to understand cookie spraying if it is going on. Also get all performance reports broken down on the same basis, the results may shock you.
- Optimize a campaign investment on your value creation terms, not the agencies hidden objectives of OMI, media commissions, groups deals etc.
Examples of Cookie Spraying – you placement / low yield inventory