With CTR on the ropes, it’s time to look to customised outcome-based metrics, says Paul Rowlinson.
“Our relationship no longer tells the full story”: so said a recent open letter from the Internet Advertising Bureau (IAB) imploring brands to end their dependence on clicks.
As part of a mission that also launched National Anti-Click Through Rate Day, the note highlights the need for online advertising measurement to track tangible long-term impact, not just ‘vanity’ metrics. And it seems a growing portion of the marketing community agrees.
Last month, Unilever declared its intent to create an industry-wide multi-media assessment model that will trace campaign effectiveness across TV, digital, and social media. And Xaxis’ own research has shown the vast majority (81%) of marketers are considering investing in varied custom metrics, linked to core business objectives, within the next two years.
So what’s behind this sudden shift, and could the industry be heading in an outcome-based direction?
The trouble with proving marketing value
Amid growing pressure to demonstrate how their efforts impact company performance and justify spend, it’s no surprise more than 80% of marketers feel correlation between digital campaigns and business outcomes is key. Yet they also find evaluating digital spend challenging; with seven in ten (71%) stating difficulty levels have risen in the last five years.
Typically, this is put down to complex consumer journeys: tracing responses to online ads across a variety of touchpoints isn’t easy. But there is also rising recognition that measurement methods need to change. Conventional siloed approaches where assessment is divided by channel do not offer a consistent, tangible view of overall effectiveness. And continued reliance on click-centric proxy metrics — including CTR, cost-per-click (CPC), and cost-per-acquisition (CPA) — hasn’t helped enhance precision. It’s increasingly clear that to prove their worth, marketers need a broader measurement perspective that tells the whole story.
Customised measures take centre stage
An essential pillar of this move towards better advertising analysis is customisation: in this case, not for consumers, but for metrics. Following high-profile criticism of ineffective digital ads, such as P&G and its $200 million budget cut, brands want more granular evaluation, and marketers are realising generic proxy indicators can’t meet this demand. Providing a comprehensive view of the impact made by each online media placement requires a refined approach.
Assessment criteria is taking a tailored turn; 86% of marketers now use custom key performance indicators (KPIs) to understand campaign impact, with only 2% still citing CTRs as their primary metric. But while this change is positive — CTR only tracks clicks, whether accidental or deliberate, not meaningful engagement — its success depends on optimal setup. For instance, getting the full performance picture means collating information from multiple channels at once, and quickly translating it into usable insight. And to do that efficiently, smart technology with large-scale analytical capability is essential. Moreover, to accurately establish how marketing activity affects the bottom line, marketers must ensure KPIs are aligned with the factors that matter most to their organisation; business goals.
A tangible link to business outcomes
To maximise evaluation efficacy, marketers must ensure their custom KPIs are chosen with care: tracking specific actions that indicate fulfilment of desired business outcomes. For example, a retailer wants greater visitor numbers at its flagship store; tracking footfall will help marketers link their efforts to increases in shopper traffic and demonstrate successful uplift. Additionally, applying a single set of outcome-based metrics to multi-channel campaigns will make it simpler to identify what is working and what isn’t; fuelling smarter spend allocation that enhances ROI and reduces waste.
While some industry professionals have welcomed the IAB’s ‘clickhead’ initiative, others are already working hard to resolve evaluation drawbacks, as pointed out in a firmly worded rebuttal from ISBA. The discussion is welcome but more work is needed to make marketing truly quantifiable. By swapping generic measures and limited CTRs for customised outcome-based metrics, marketers can gain insight to effectively validate their campaign’s impact and produce a better standard of online advertising for all.