Why You Should Stop Using CTR as a Primary KPI
By Eric Steinhardt
Eric is a Client Strategist at OwnerIQ
As marketers, we can try to predict how our target audiences will interact and engage with our campaigns, but often overlook common sense in the process—everyone in this industry is also a consumer. How do you personally engage with ads? Do you click on them? When was the last time you clicked on an ad—intentionally? I pay attention to ads around me, but the only time I click is when my klutzy fingers slip on my phone, and it’s usually on something irrelevant to my interests. Even when I see an ad for something I’m interested in, I usually enter a URL or search term in my browser manually, rather than click on the ad.
Is it safe to say ads have no impact on my behavior because I didn’t click on them? Absolutely not. So why do we measure the success of campaigns this way? Because it’s easy? Because it’s how we’ve always done it? These aren’t good reasons.
How are you measuring the success of your display campaigns? Is a high CTR your primary KPI? If so, what is that really telling you?
I sincerely doubt any IR 500 CMO is sitting in a meeting right now saying, “Let’s shift our budget to increase the number of clicks on our ads!” But what’s really important? I’d wager there is a higher likelihood of a focus on increasing sales and/or building brand image when you really dig down. Let’s cut to the chase—clicks do not indicate conversions, and more clicks do not equal more conversions. Period.
ComScore and Starcom USA released a study in 2009 reflecting that 8% of the Internet is responsible for 85% of the clicks, and that number is believed to have even gotten worse since then. While the article is a bit dated at this point, the principle holds true.
John Lowell, former SVP Managing Director of Analytics & Development at Starcom MediaVest Group made an excellent point in the study, stating, “You want people to visit your website, seek more information, purchase a product, become a lead, keep your brand top of mind, learn something new, feel differently – the list goes on. Regardless of whether the consumer clicked on an ad or not, the key is to determine how that ad unit influenced them to think, feel or do something they wouldn’t have done otherwise.”
We also must not ignore the entire taboo topic of click fraud, which is estimated to have cost marketers $11.6 billion in 2014, up 22% from 2013.
At the end of the day, focusing only on clicks as a success metric simply doesn’t make sense—clicks don’t prove purchase intent. Studies show that less than 10% of the Internet is responsible for the majority of the clicks, and non-human bots are roaming web pages, wasting billions of marketing dollars annually.
OwnerIQ provides zero ad waste, and reaches in-market shoppers wherever they are shopping. Doesn’t that sound refreshing to actually get in front of your qualified audience? If so, then let’s all stop focusing on meaningless clicks. Who’s with me?