Ad:tech impact explores metrics

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Ad:tech, the online advertising industry's largest conference series, kicked off ad:tech impact, a 10-city conference tour that focuses on advertising and marketing metrics.

The ad:tech conferences are produced by dmg world media, which acquired ad:tech from JD Events last year.

Ad:tech impact provides advertisers with research, strategies and techniques for measuring the effectiveness of online advertising and marketing campaigns.

The tour kicked off in Seattle on Feb. 28 and will run through April 6. Locations include Phoenix, Los Angeles, Dallas, Atlanta, Denver, Boston, Toronto, Cincinnati and Fort Lauderdale, Fla.

About 120 marketers met at the Los Angeles event on March 7, where they got a one-day crash course on metrics, dashboards and testing best practices.

"Far too many advertisers rely on click-through rate as the metric to measure the impact of a campaign," said Rick Bruner, director of research at online advertising company DoubleClick. "Marketers sell themselves short by not doing enough analysis.

He presented results from a research report that DoubleClick will be releasing in the next few weeks, titled "Best Practices for Optimizing Digital Advertising Effectiveness."

Key strategies, metrics

The report outlines four key strategies that marketers can use to improve the effectiveness of online campaigns: define objectives; segment audiences; optimize campaigns; and review, assess and improve. He presented a variety of metrics, from the simplest to the most complex, that marketers should be using to measure and optimize online campaigns. Those include click-through rate, view-through rate, reach/frequency, conversion rate, lead generation, ad engagement, brand attitudes, site engagement, demographic exposure, yield lift and life-time value of customer.

Bruner said one of the most effective strategies online advertisers can use is controlling the reach and frequency of an online ad. "We see a rapid drop-off in conversion rates after users see the same ad 15 to 20 times," he said.

To find the optimum frequency cap, marketers should test online ads with a control group that has not been exposed to the ad, Bruner said.

He also presented strategies for segmenting audiences.

"Most companies segment by contextual advertising, but there are some other effective ways to segment," Bruner said, pointing to geography, daypart, bandwidth, customer behaviors, recency of visit, frequency of visit and monetary value of the customer.

Multivariable testing essential

In another session on optimizing online campaigns, experts presented strategies for testing and evaluating online advertising.

Sunil Gupta, senior consultant at database consulting company David Shepard Associates, discussed the importance of multivariable testing for online campaigns. "The more testing you do, the better it is," Gupta said.

He presented a case study that demonstrated the limits of A/B testing, in which marketers run tests against two variables, making one change at a time. The case study was for an insurance company that was considering making a change to an online promotion for a special pricing offer.

The company had six different variables it wanted to test in its advertising. Using A/B testing, the sample size for the research would need to be more than 19,000 contacts in order to be reliable. Using multivariable testing, the sample size would need to be fewer than 6,800.

Gupta presented more detailed information about how to conduct multivariable tests, how many combinations of variables to use and how many respondents to include in testing. His research is available at

Matthew Roche, co-founder and co-CEO of Offermatica, an online ad testing and optimization company, said, "Testing works because in the end we don't know what is really going to motivate our customer."

Roche presented examples of how testing online ad campaigns resulted in dramatic results for clients.

In an online evaluation for eFax, an Internet faxing service, Offermatica tested four different headlines running with an online ad.

It found that repeating the headline in the first line of copy ("Start faxing by email with eFax") resulted in a 63% increase in revenue per visitor.

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