We’ve all been guilty of overusing industry speak—of succumbing to the digital advertising jargon or strategies that everyone is talking about at the moment. But the truth is, when we speak only in terms of things like scalability, relevancy, viewability, and CPI, we lose sight of what we’re actually trying to achieve… and what these metrics really mean.
Understanding the implications of measuring by a single metric
All too often, RFPs come our way that say something along the lines of, “Show us how you can get us 80% viewability on $50,000 on mobile and reach an eCPI below $5.” There are a lot of metrics crammed in there, but no indication of what the client is really looking for as the end goal.
Does the client realize that a CPI goal indicates that we’re guaranteeing an install that can only occur after a download, which happens after a click, which means that an impression was seen? At that point, guaranteeing viewability is superfluous, but it’s put on the plan for the sake of comfort.
As Tommy Boy said, “Here's the way I see it, Ted. Guy puts a fancy guarantee on a box 'cause he wants you to feel all warm and toasty inside.” And that’s exactly it. We’ve lost sight of the purpose of a KPI, a key performance indicator.
What do you really want?
The problem with looking at any metric in isolation is that you begin to deprioritize your ultimate objective. Marketers need to define their end goal and work with media providers to determine the best stepping stones to get there. But this whole process needs to start with open communication.
Asking for and paying for viewability without identifying the final goal as being a $50 purchase puts both teams in a bind—buyers can’t optimize toward what works and planners don’t get what they’re ultimately looking for.
Sure, impressions are the top of the funnel, and increasing the number of people that see your ad will boost the chances that the next step in the path to purchase will be realized, but simply asking for a metric doesn’t get anyone where they want to be.
Metrics have a purpose, and a key performance indicator should be just that—an indicator that another action should follow. Understanding the path to purchase for every advertiser—and the logic behind that path—is vital to success on both ends.
Breaking it down
There are so many areas of our lives where we use KPIs to help us understand progress against an ultimate goal. Think about why this article is even relevant to you and how you got where you are right now… it probably started with wanting a job. You worked on your resume and you were super proud that you sent it out to 20 companies – someone has to bite, right?
Well – think of those 20 resume submissions as impressions. You hope all 20 people read your resume, but the only way to know for sure is some sort of validation: an email or call that it was received. You’re realistic though and you understand it would be unlikely to get 20 responses, so you set a goal for yourself – you really want 3 of those 20 to get back you. You found it: your first KPI. In reaching this moment, you haven’t met your goal, but you know you’re that much closer to getting there.
Now for the big moments… call backs, interviews, coffee dates. Each item feels like a win in the moment, but the reality is that they are all subsequent stepping stones to getting you to that paycheck. You wouldn’t submit your resume to 20 companies in hopes of 3 responses without ultimately wanting a job, so why ask for 70% viewability without explaining that you’re really hoping for a 3% conversion rate on your loyalty program sign-up?
The bottom line
Mini goals are important, they break down large tasks into bite-sized chunks that feel achievable, and therefore are achievable. But metrics are only valuable if you take them at face value and understand how they contribute to your ultimate goal. You know what you’re working toward—whether it’s gaining an email sign-up, an Instagram follower who sees your posts daily, a one-time customer who makes a $20 purchase, or a loyal customer who spends $3 every couple of days at the same coffee joint. Whatever the target objective may be, the most important thing is to make sure that it is universally understood.
It’s time to be open and transparent with your agencies, tech providers, and media companies.
Explain your end goal and the path to purchase your users take. Recognize the value in each individual KPI and listen to feedback from your partnerships if they think you’re looking at the wrong KPI – you hired them for their expertise, after all. There isn’t “one metric to rule them all.” Many things contribute to success, but marketers and media teams need to be aligned on where we’re going in order to achieve it.