I was watching an interview I did last week at Ad Week with Gian Fulgoni, Chairman of ComScore. The interview will be posted shortly.
Clicks no longer predict the effectiveness of a display ad. People are fixated on clicks because they can be measured, but not everything that can be measured matters. It’s a direct response metric, but not a relevant metric for the effectiveness of display advertising. Display advertising is a means to communicate branding, and what count are cumulative impressions, frequency and reach of the advertising campaign, metrics that have been used extensively in traditional media.
20% of all the display ad impressions are running on social networks, but social networks only account for 3.5% of all advertising dollars, which indicates the lower CPMs they are able to command relative to other types of Web sites.
Data doesn’t lie, and new data will help convince large brands that online advertising is more effective than traditional advertising because it can reach target segments more accurately. It delivers more impressions to the target audience. This doesn’t mean to imply that advertisers should not continue to use all mediums, but it certainly validates that online should warrant a larger share of an advertisers budget if their online budget is still anemic compared to other mediums.
His example, based on recent ComScore research, shows the comparative effectiveness of television advertising to lift CPG brand sales in retail stores and Internet advertising. TV can lift sales 8%. In 3 months, the Internet can raise offline sales for CPG brands by 9%. Data is what is needed to convince, for example, packaged goods brands, to move more dollars online. And the data is starting to come in.