What can data metrics really measure? Are clicks leads? Are CTR's (click through rates) equal to ROI (return on investment)?
I've been in the marketing, advertising, and small business development for my entire career. In Charlottesville and surrounding areas, I've worked with small local companies with very small budgets to Energizer in Verona, Virginia (now Accutec), where we worked with massive budgets that were spent on media buys that ran across the country. I've placed ads on traditional media, such as Television, Radio, Magazines, to digital ads on Apps and Websites. Currently, I'm placing ads anywhere people can be found in the digital space, be it on OTT (Streaming TV), Audio (like Spotify), ads on mobile phones, video pre-roll ads, You Tube, Facebook and Instagram, both for local companies, and national companies, and more.
When digital advertising became the go-to advertising channel, businesses rejoiced at finding a new, "easy" way to market, advertise, and measure.... right? We wish it was that easy!
The truth is, no matter what, advertising and marketing just isn't easy! The principles haven't changed, even if the way they're delivered has. So let's look at metrics and metric buzzwords:
ROI: Return on Investment
What are you measuring? Your marketing team can help get your ROI up, but it's the company owners that determine what needs to be measured. Too many times I find companies lean on an advertising channel to come up with the ROI. A return on investment can be clearly measured (like a product offer) or it can be measured by new traffic to a website and general brand awareness. It's not always dollar for dollar. What area of the business are you trying to grow? Where is the starting point or number? Write that down, invest in marketing for a set time, and go back and review the numbers. Generating sales may be your ROI calculation, overall company growth can be your ROI calculation. The list is endless! But, it's the company that decides the ROI, not the advertising channel.
CTR: Click Through Rate
A click through rate is one of the least understood parts of a digital ad campaign. People throw out "Click through rate" without really studying the numbers behind that. Most CTR numbers are averages. But, many times parts of a campaign blow up the metrics. Those are the numbers business owners should pay attention to. Those help the averages, but the real questions should be: where are the BEST CTR's on each campaign coming from? Video? Animated GIF files? Tablets? Mobile Phones? Address targeting? Which Creative is working? Which headline is working? and more. From there, you can grow and build on that success. Using one number as the CTR is simply lazy in my opinion. Dive deep into that data!! There's a lot to learn.
CTR is also an indication of how a campaign is performing: is it going to the right audience on the right channel? Most people do not click on digital ads, but they surely see them! A CTR is not the end-all on campaigns. Consider the number of impressions served. That's your "frequency" and "frequency" is a bedrock of advertising. The CTR should give advertisers confidence in where the ads are running. If the CTR is super low, something needs to be changed. If it's super high, build on what is working.
What, exactly, is a "lead"? Again, it goes back to the company owners to decide what data REALLY matters to them. Traffic to a website is not "a lead." Leads are DATA from consumers. When a potential customer gives out their personal data, that is a lead. It can be in the form of an email, a phone number, or an address. But getting that data is what is considered an actual "lead". What a company does with that "lead" is up to them. If someone is willing to give out their data, the onus is on the businesses to follow up with a phone call, offer, or membership. Anyone who gives out their data should be considered a HOT lead, and followed up on immediately. Considering web traffic as "leads" is disingenuous at best. All companies should be aggressively trying to capture data from their web traffic, especially once they launch a digital ad campaign and web traffic increases - how to go about that will be addressed on another blog!
When looking at your local advertising and marketing campaigns for 2022 start with the basics, and determine:
- What area of the business do you want to grow (be as specific as possible.)
- What would you consider "good" growth? Over how long? Write numbers down on paper and think it through. There are likely to be a few channels of growth, not just one. What is realistic growth for the industry and years in business? Every industry has patterns. A new business can grow rapidly while an established business may have leveled out.
- What leads are you trying to get, and what are you offering for someone to give up their data? And, what is your plan once you capture leads in order to make sales?
CTR, ROI, & Leads are misunderstood. Take time to understand just what your advertising can and can't do in 2022 to maximize your local and national advertising in the New Year, and ask all the right questions for your ad campaigns!
Article Copyright Anne Flinn Advertising, 2021. Reprint or share with tag or permission.