I saw this chart in Adweek earlier this week, and it was followed with a report by AdKeeper and 24/7 Real Media with an explanation for why display ad CTRs were .09% on average last year. (Not sure what to make of “Kids.”) For the uninitiate, a CTR, or clickthrough, is the percent of times online users click an ad. So a CTR of .09% means that if 1,000 people see a display ad, only .9 people (1000 x .0009), less than 1 will click it. This seems shocking, even horrific, until one considers that no one clicks a TV ad, billboard, radio, or piece of print. With that said, a generation or two ago Lester Wunderman and David Ogilvy wrote amazing newspaper ads that elicited readers to mail in information cards with great success. Mail was the first click.
There’s a balance between branding value, or as I like to call it “halo,” and direct response. If you’re trying to build a brand that will have high offline action, buying packaged goods or tuning into a movie or TV show, halo matters. People do see a cool rich media ad online, or on TV for that matter, and act later. The problem is, to quote John Wanamaker and credit Duncan Watts for citing the quote, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”
To further quote Watts (disclosure, he’s BuzzFeed’s science advisor):
How is it that in spite of the technological boom since Wanamaker’s time – penicillin, the atomic bomb, DNA, lasers, space flight, supercomputers, the internet – his puzzlement remains as relevant today as it was then?
We can put a man on the moon, but not fully determine the effectiveness of advertising.
And so we continue to try and measure the impact of brand advertising, because brand advertising is important and valuable, if difficult to quantify, and it works.
The click plays an interesting role. Some parties have a vested interest in saying that clicks don’t matter, and that all that matters is halo. And there is some evidence that only 8% of internet users account for 85% of traditional display ad clicks. The irony is that these same anti-click advocates urge brand lift surveys as the best measure. The logic being that you don’t need people to click on your ads, but you do need/want them to click to fill out long surveys, popped in front of them as they browse, often without incentive. Why a click to fill out a survey is good and needed, and click on an ad is unnecessary and undesirable baffles me.
Other parties say it’s all about clicks, and are so obsessed with clicks that they’ll do anything to make them happen. Relying on confusing ads or remnant inventory on low quality sites that generate clicks, hypothetical leads, at the lowest prices. This is the equivalent of putting your brochures for car insurance in a pre-school and being psyched when 20% of then taken, albeit to doodle on; and disappointed when only 5% of them get taken outside a car dealership.
The reality is that the answer is somewhere in the middle, where, as Mom and Dad have been saying for decades, most reasonable solutions and answers tend to be. CTRs of .09% are just too low, they just don’t pass the sniff test. There’s no way .09% can be a proxy or indicator of larger halo engagement.
And, so, the 90-9-1 rule of social engagement kept rattling in my head. Also known as “the 1% rule,” it states that on the internet:
- 90% of people just read
- 9% edit
- 1% create
It seems to me that a rough rule or goal for online display ads should be something like:
- 90% of people are aware of the ad in some halo fashion
- 9% are impacted to a greater extent through later online action or offline action (tune in, purchase consideration, etc.)
- 1% click, share, or engage with the ad or branded content immediately
I think here the 1% click is the evidence of the 99% halo and impact.
And how do we get to or aim for 1%, or higher. Great, engaging, content driven advertising. Where the dog is the content and the tail is the call to action, and the dog wags the tail.
This is why at Buzzfeed, we consistently see on our in-stream, branded content units get CTRs of above 1%, often closer to 2%. This is 10 to 20 times industry averages on traditional display units. This is a return to the ads of Ogilvy and Wunderman, where people are given content gifts to spur action.
Branded content achieves both halo and click. And when optimized around sharing behavior, branded content has the added benefits of human to human targeting, which is so much better than cookies. Beyond halo and clicks, branded content also achieves strong pass along value; it is something one user passes to another because she knows it will be of interest. Cookies can’t compete with social.
And so branded content optimized around social, achieves halo, clicks, and viral lift. It even rhymes.
If you’re interested in learning more, please contact me or head to our Advertise on BuzzFeed microsite.