Measurements and Metrics Measures Up
This was a fantastic panel. Finally, data guys (and gal) who understand advertising and the many different things metrics can point to. Moderator Jack Flanagan of comScore, and panelists Esco Strong/Atlas, Natasha Funk/Terra Networks, and Martino Bagini/RealMedia Brazil all brought a wealth of knowledge on the current landscape of analytics, and wonderful insight into the future potential of online marketing.
The moderator started things off with a phenomenal question: What’s the difference between ROI (Return On Investment) and KPI (Key Performance Indicators)? ROI is king in the internet world, but evaluating ROI is becoming more and more complicated as analytics systems become more effective at tracking individual users and the metrics for KPI increase.
We used to be amazed that we could actually see what words people were searching on before they bought, but it turns out this isn’t enough anymore. Shocking! I know, every publisher out there has been screaming this for a while (especially when pushing CPM), but now the data is coming around and we are beginning to see that the term they searched on is not necessarily how they originally came to the site, it’s just the way they got there when they decided to buy. Suddenly impressions, reach and frequency are back in the fight; and they brought friends!
The point really: you can not define the effect of a campaign by direct response alone.
Don’t get me wrong, the old advertising model makes no sense, ROI is king for a reason. But the meaning of ROI needs to evolve with the options for KPI. The difference, of course, is that our data options are growing and that means that the path of user interaction can be more specifically tracked, your campaign refined, and results improved beyond today’s standards.
One huge word of caution from the panel; make sure your data is actionable. Define your goals (ROI), and then choose the proper metrics (KPI) to evaluate.
And, just my two cents, don’t go into this blindly, read up on data resources, post questions to forums and talk with other people from the industry before you buy any data or use any services. Too much data can be as bad (and more expensive) then no data at all.
