A look back at the iMedia Summit

Another year ends with a bang in sunny La Quinta, CA. Attending my first iMedia Summit from the "dark side" was an experience. It was great to see a fairly balanced view of the world given the gloomy economy and the uncertainty that it puts on the adverting business. Most felt they would hunker down and make it through to 2009 and beyond. The event was well attended, although I would say not oversold, and probably a bit skewed toward West Coast folks versus those who needed to cover the expense of flying in from other parts of the country.

As with most Summits, the content tended to lend itself to the current themes in the business. I was glad, but not surprised, to hear the themes echo our focus at Undertone. In no particular order, they were:

1. Insights, insights, insights. Insights are a way to drive value for our customers and partners. What is an insight? Without referencing a dictionary or a wiki, an insight (according to me) is any information or meaning you can learn from data that teaches us something new about a campaign, target group, etc. It is not necessarily the "ah ha" moment but it is meaningful, big or small, and can impact they way an advertiser thinks about a campaign.

Bottom line: Undertone will be the network that delivers performance, quality and insights to its partners.

2. Safety and security mean something more today than ever. With limited time, budgets and resources, advertisers need to know what they are getting and that they won’t be spending time writing apology letters to their clients.

Bottom line: Undertone delivers all that with the efficiency and ease of a network. Our $50,000 guarantee is a great start but our human driven exchange and the fact that we work with a limited number of publishers are equally important.

3. Terminator Effect. An important theme for us to watch closely is what I refer to as the "Terminator Effect" or man versus machine. Most of the major ad agency holding companies are developing some type of system to place ads directly or through networks based on their own massive data pools. They believe they can value inventory down to the impression level and gain great efficiency for their clients. Right or wrong, we will be working closely with them to determine how Undertone participates.

Bottom line: Humans (that's most of us) are much better at insights than machines so we need to focus on delivering those insights. We'll always need to consider how we drive value to our agency, advertiser and publisher partners beyond quantitative performance. With multiple systems under development, there will be data ownership and standards challenges. Not to mention, that not every client is comfortable with an agency owning their data.

I look forward to discussing this with all of you in the coming weeks.

Study: Cluttered websites benefit no one

According to a recent study, websites cluttered with ads prove to be less effective for their clients than sites that have a clean layout and are less cluttered. Although it should not be a surprise that sites inundated with ads do not perform as well for advertisers, one stat did jump out at me: 52% of users had a negative perception of the advertiser when the ad was displayed in this cluttered environment. That translates to a huge number of users who are being negatively affected by online ads, due to the sheer number of mid and long tail websites that show more than two ads on screen to users.

These findings should add a whole new area of concern for advertisers when planning their buys – not only do planners and buyers need to ensure their messages are not running across inappropriate content, but they also need to prevent their ads from running across websites that may have safe content but are cluttered with lots of ads. Web publishers should take these findings as a clear message to design their site in a well lit, clutter-free environment so that clients, users, and the publishers themselves can all benefit.

And before our sales team asks, I’ll provide some insight into our network – the ‘look and feel’ of a site is a very important qualifier when our media team brings new sites into the network. Nearly all of our inventory consists of publishers that show no more than two IAB standard ads to users on-screen at any time.

What’s in a click?

I just finished reading comScore’s latest paper ‘How Online Advertising Works: Whither the Click?’ which questions the relevancy of using clicks to measure the impact of display ads. This paper could not have come at a better time as we’ve been seeing an increase in client requests to optimize toward clicks. It makes sense that marketers are looking to make their media buys more efficient and accountable in this economy, however more often than not optimizing toward a click is the exact opposite of what we should be doing. Just because we can measure and optimize toward any given metric doesn’t mean that we should.

Consider the following evidence from this paper:

• Starcom research suggests there is no correlation between display ad clicks and brand metrics. When campaigns have a branding objective, optimizing for high click rates does not necessarily improve campaign performance.

• Two-thirds of Internet users do not click on any display ads over the course of a month and only 16% of Internet users account for 80% of all clicks.

• Click demographics are skewed toward younger users aged 25 to 44 earning less than $40k per year.

This report also shows evidence of latency effects of display ads post-exposure to the ads. Despite a lack of clicks, display ads have a positive impact on:

• Visitation to the advertiser’s web site (lift of at least 46% over a four week period)

• Likelihood of consumers conducting a search query using the advertiser’s branded terms (lift of at least 38% over a four week period)

• Consumers’ likelihood of buying the advertised brand online (average of 27% lift in online sales)

• Consumers’ likelihood of buying at the advertiser’s retail store (average lift of 17%)

At Undertone, we believe that reaching the right user in the right environment is much more impactful than reaching a user that will simply click on an ad.