The return on investment (ROI) from online advertising may be much higher than most marketers believe, according to the latest findings from the ever-optimistic Jupiter Media Metrix.
The new research says that actual ROI from online ads is at least 25-35% higher than the general perception. These benefits will not be seen in the most commonly used direct marketing type campaign measurements (like click-rates and cost per conversions), but from branding based measurements, says Jupiter.
“Jupiter case study data show that the actual number of customers driven to websites by online advertising is greatly underestimated by traditional click-rate metrics. When brand advertising programmes generate synergy across all marketing channels, that number can grow significantly beyond what can be tracked,” said Rudy Grahn, an analyst at Jupiter Media Metrix. Marketers must begin quantifying online branding by measuring users’ actual experience, instead of gauging only their attitudes – not everything is intended to be branding, but everything brands, says the report.
“Although much of the talk about the ‘new economy’ has been debunked, the old dogs still have new tricks to learn,” Grahn said. “What is learned in online branding may not set completely new rules for marketers ultimately; but it will offer lessons wise marketers will heed. What marketers learn about building targeting models from observed behaviour rather than pre-campaign demographic or psychographic data must be factored into off-line campaign planning, as well.”
The group’s research also shows that marketers who are looking to correlate ad spend with an increase in traffic are taking the wrong approach. While online advertising is more effective than marketers believe, it is still secondary to other factors in driving traffic to sites: online advertising only contributes to 17% of the traffic to a website, while seasonality and an increase in internet adoption contribute to 46 percent and 37 percent of the growth, respectively, the report says.
