Tag Archives: Facebooks ad rates

Are clicks overrated??

With the inception of the Internet, marketers have been all excited about the supposed benefits of online marketing with many considering it the most measureable form of advertising available (guess they never heard of old fashion call tracking). In theory, I understand why they would think that way as every keystroke can be recorded, analyzed, and “what-if”-ed to death.  But I’m still not sure why these marketers spend so much of their time focused on what would appear to be a relatively insignificant data point — the click

True, these marketing gurus can flip open Google Analytics (or other click-tracking software) to see exactly how many users interacted with an ad, and even get all excited about conversion rates, measuring not only how many people clicked on an ad, but also how many actually did something of value, like make an actual purchase after the click.  That kind of data is a lot more accurate than the traditional measurements of guessing how many eyeballs saw or did anything after seeing a 30-second spot on television.   The click has been THE measurement metric of the web for marketers.  At first glance, clicks seemed like a metric that made sense.  But now when you dig a little, you realize there’s a lot more to be looking for.  What happened??

The reality is 99.9+% of banner ads don’t ever get a click.  Think about it.  How often do you click on one of those ads?  And tell me what other media bases their success on a metric where the industry average response rate is 0.1 percent?  Even the best banner campaigns that I have heard of usually has a click-through rate of well under 10%. Ad networks are touting “success” at a 0.05 percent click-through rate. Isn’t that a pretty sad response level, even if the advertising is cheap compared to other media?   Or is it a case of you get what you pay for.

I’ve noted several other comments that online advertisers are too hung up on the rate of click-throughs.  According to an article this spring by Simon Owens , the Director of PR for JESS3 writing in the Nieman Journalism Lab,who noted that in reality, it is a hit-or-miss proposition at best (mostly miss) that  you’re going to capture a consumer just at the moment he’s interested in a particular product or service and get them to click on an ad. Other studies have suggested a better strategy may be to create a lasting impression (didn’t use to be called “brand marketing”) with an image — such as the well-known Geico Gecko.

Yet despite these super low results, Google, the king of search and internet advertising has seen it appropriate to institute an 18% rise in the cost per click from last quarter with only a corresponding 12% increase in clicks. And advertisers use to say print Yellow Pages were predatory for constantly raising ad rates as the perceived usage went down.

In the growing world of social advertising, the “cost per click” of an ad placed on the popular Facebook site has increased by 74% over the last year in four of the world’s largest media markets, according to TBG Digital, an independent marketing firm specializing in social media.  And for these growing advertising costs you get what?  According to a study by Webtrends this year, Facebook’s average click-through rate for an ad was 0.05 per cent in 2010.  Whoopi hoo..