In recent years, the digital advertising landscape has seen waves of change, evolving the modern advertisers’ remit. Before, goals may have centred around getting as many clicks as possible. Now, it’s all about achieving deeper ad personalisation and relevancy, getting around ad blockers with trusted content, and measuring your ad efforts accurately.
It is crucial that marketers understand the fundamentals needed to ensure their digital campaigns are set up for success, but even today measurement and attribution remain a key challenge for many.
A gap often exists between what marketers measure and what metrics actually deliver business value. More importantly, the data used to measure against these metrics is often retrospective rather than current, which makes it difficult to get an accurate picture of advertising performance.
So how should businesses go about measuring the effectiveness of their ad campaigns, particularly as the cookieless future is about to change everything?
Measure against your business objectives
It might seem like an obvious mistake to avoid, but many marketers continue to fail to match their media metrics against the overarching business objectives they’re required to achieve. Let’s talk about one example in media.
In the past, when broadcast media was the dominant channel to reach audiences, the efficacy of media was measured using ‘quantifiable’ metrics such as reach and frequency. Then, around 1995 came the boom in digital advertising, with search marketing becoming popular.
It’s easy to mentally create a link between ‘engaged consumers’ and a high CTR, but digital advertising has evolved since the 90s, and while ad formats and media channels are more varied than ever, click-through-rates are still used extensively to measure the effectiveness of digital advertising.
But the simple truth is that CTRs alone do not tell the whole story. A high CTR might be a good indication of how attractive your ad creatives are, but it doesn’t indicate whether a user has actually bought your product.
So if higher sales revenue is a business objective in your organisation, relying on clicks means you could be missing valuable opportunities to reach new markets, make more money, and save on your ad spend.
In the cookieless future, proper measurement becomes more crucial. As consumer behaviour continues to change online, marketers and digital professionals must start to identify better ways to quantify their media dollars and directly tie return on investment (ROI) on media spend back to their brand’s business objectives. This starts with first-party data.
Measure the right metrics using first-party data
With third-party cookies soon becoming a thing of the past, first-party data is now supreme. By adopting a first-party data-only strategy and examining consumer behaviour directly off your website, or partnering with a technology vendor that’s able to set you up to do so, you’ll be able to leverage first-hand consumer data to accurately measure against important metrics such as:
- Total site traffic: the number of unique visitors to your website from several different sources, whether that’s through your social channels, paid search, organic searches, or more. Regularly measuring your total site traffic will indicate whether or not your marketing efforts are collectively bringing more people to your website.
- Customer lifetime value (LTV): the total worth of a customer to your business throughout the whole period of their relationship with your company. Because it costs less to keep existing customers than it does to acquire new ones, measuring LTV regularly will help you understand whether your campaigns are increasing the value of your existing customers, and driving growth for your business. LTV differs from Net Promoter Scores (NPS) and customer satisfaction scores (CSAT) in that it is tangibly linked to revenue rather than the intangible promise of loyalty and satisfaction.
- Cost per acquisition (CPA): measures how much it costs to get a potential customer to take an action that leads to a conversion on your campaigns: for example, registering for an event, signing up for a demo request, or becoming a lead. CPAs are a financial metric used to measure the revenue impact of your campaigns and allows you to easily compare performance across channels.
How to ensure you’re set up to measure using first-party data
Data is only as valuable as how it’s interpreted and utilised, so it’s crucial for any business wanting to succeed at marketing in the future to identify partners that can help them use their own first-party data for a variety of advertising purposes, including segmentation, delivery, and measurement.
The next step is to identify what business outcomes can be measured digitally (e.g., increased ad spend ROI, or growth in high-spending customers). Metrics should be defined upfront when campaign objectives are agreed upon to ensure that marketing campaigns are optimised towards achieving tangible results.
When you activate your campaigns, use the same first-party data you used to plan on all channels, including digital media channels such as social, programmatic display, and online video. By using live first-party data to activate your campaigns, instead of stale third-party data, you’ll allow for highly personalised and accurate advertising, now and in the future.
To see a real-life example in practice, check out how leading Singapore telco Starhub leveraged first-party data with Quantcast’s AI and machine learning technology to bring in more net-new customers.
As more businesses start to find their footing in the cookieless future, we can expect an industry-wide shift in how digital marketing campaigns are measured and quantified. Only then can we expect to see the disparity in media and measurement begin to lessen.