Clickthrough rates underestimate online campaign performance

Clickthrough rates significantly undervalue the brand performance of online campaigns, according to a Nielsen study that finds little correlation between the frequently cited metric and offline return on investment.

The study, which combined meta-analysis and modelling from hundreds of marketing campaigns, signals a need for marketers to use other metrics to gauge the effectiveness of online advertising, according to Nielsen.

“The implications of this insight are far-reaching, both with respect to the metrics being used to track online campaign performance, and in guiding creative strategy,” emphasises David Webb, Nielsen’s Managing Director of advertising solutions in the Asia-Pacific, Middle East, and Africa. While clickthrough rates are an effective means of measuring call-to-action campaigns, they are potentially misleading and dangerous when applied to branding campaigns, he added.

Campaigns that use both television and online channels generate up-lift in brand recall, message recall and likeability. The brand metrics most likely to improve as a result of cross-platform advertising are also the metrics which have been most closely linked to increased sales.

“To date, marketers have been reluctant to invest in digital marketing due to a lack of clarity around the brand benefits and direct return on investment,” Webb said. “Analysis such as this is addressing that lack of insight.”

Another notable finding relates to the capping of impressions for online campaigns. Contrary to the common practice of capping impressions between three and five, Nielsen’s analysis shows that online campaigns with higher impressions, particularly eight or higher, achieve a stronger lift in brand performance metrics.

In addition, the Nielsen analysis also includes statistics on video advertising and overall return on investment, the latter revealing a clear lead for digital media over traditional media, with internet marketing providing a return of $1.29 for every dollar spent and other forms of digital marketing providing as much as $1.48 return.