Archive | 2011

The Faulty Comparison of “Analog Dollars” to “Digital Dimes”

This post originally was written for and appeared in adexchanger.com. The comparison of “analog dollars” to “digital dimes” is often an attempt to explain that paltry digital revenue is coming from commoditized advertising prices.  When you dig deeper into rate cards, the reality is quite the opposite – digital rates are more expensive than print!  The digital dimes issue does not stem from pricing but from size and quality of audience.  Here some math to explain. I reviewed individual media kits from 10 B2B publishers that contained both print and digital advertising units to get apples to apples comparison of print vs. digital within one publisher.  A consistent theme emerged – digital advertising rates were higher than print advertising rates.  […]

The Real Price of Advertising

Audience metrics are the key for publishers to increases prices and advertising revenue.  In fact, right now most publishers are charging more than they think for advertising, because who receives the page views dictates the real price of advertising.  But without the right metrics, they are not able to package and price their advertising inventory to maximum revenue potential. Most publishers sell advertising inventory based on aggregate measures of page views and unique visitors, assuming that views are distributed evenly among visitors. But here’s the reality. First, a small number of loyal visitors (“Fans”) consumes a disproportionately large number of page views (and ad impressions), while a large number of one-time visitors (“Fly-bys”) consumes disproportionately few and a small number […]

Click-through rates: the metric for missed expectations

Click-through rate (CTR) is often used to describe the advertising performance on a publisher’s site. CTR for an ad is defined as the number of clicks on an ad divided by the number of times the ad is shown (impressions), expressed as a percentage. If the ad sales team for a publisher claims 1 million monthly unique visitors with 4 million page views and a CTR of 0.2% (or 8,000 click-throughs), the buyer might think those click-throughs are all distributed across the million unique users to yield 8,000 unique conversions.  The buyer and the seller are wrong. Here’s the problem: CTR doesn’t take into account audience engagement, not to mention the fact that other advertisers are competing for the click-through […]

Value Rating Part 2: Targeting in Subscriptions

In subscriptions, how can a sales manager differentiate the up-sell vs. the retention risk between two customers with same number of page views and visits? Value Rating is the answer, or the percentage of page views that are units of value (full description of Value Rating in Part 1 of series). Using Value Rating as a metric, Scout Analytics has found that categorizing engagement on page views alone, will incorrectly classify the revenue opportunity of 15 percent of customers. The consequence of using page views as a primary metric is that sales managers will use wrong negotiation tactic with customers 15 percent of the time. Chart 1 to the right will help illustrate the limitations of page views only. The horizontal […]