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Clicks Don't Matter

6 Minute Read

There is no correlation between a click and actual in-store or online spend. That is not a typo, it is a truth that we continue to see across all categories with few exceptions. Unfortunately, while as an industry we have become experts at driving efficient means to drive clicks, these clicks can’t be used to pay down overhead, invest in R&D or increase gross margin. Clicks are not a currency. Currency is a currency.

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As marketers, we crave more deterministic methods to demonstrate that our marketing executions work (and, better understand how to fix them when they don't). We believed that clicks, as indicated by a consumer action, were a significant improvement versus the obvious limitations of measurement using circulation, placements, and estimated audiences. A click provided us a way to measure consumer action taken on ads across digital platforms. From these clicks, the first true pay-for-performance metric – cost-per-click or CPC – was born. But, CPC was deceptive. A click is only a proxy for consumer intent to buy, but it doesn’t tell us if a purchase is actually made.Related to CPC, we use ROAS (or Return on Ad Spend) as a way to measure the return of our online campaigns. But, ROAS has two key flaws:Attribution: Who gets the credit for the sale? Is it the last click? Do all clicks get a share? Should we divide sales among impressions and clicks? There are countless attribution companies to help marketers answer these questions, buttheystruggle to deliver a definitive answer.Online to Offline Impact: Since digital marketing is often linked to online sales, companies tend to group them together – that is, digital marketers are evaluated on online sales. But, 92 percent of sales happen in stores, so how do we understand the impact these digital campaigns have on offline sales?Digital marketing teams are held to the KPI of online sales because there are few alternative measures of effect and ROI. As a solution, I’d offer that there is a new currency for measurement: currency.Working with our advertiser clients, we see that campaigns optimized on clicks – as with most programmatic buys – do deliver thousands of cost-efficient clicks. However, as counter intuitive as it seems, our experience is that clickers are not spenders. In fact, they are just as likely to be spenders and non-clickers. Therefore, optimizing on clicks will not provide the same level of actual purchases as that same advertising dollar could generate if targeted and measured based on spend likelihood. We help marketers optimize campaigns based on true sales. Our patented method links online consumer behavior - like exposure to an online display ad, frequency, creative - to online and offline purchases to help marketers accurately evaluate the true sales impact of their efforts. Digital advertising works. If we optimize for currency, returns will increase significantly.Want to read more from about why sales trump clicks as the best metric for marketing effectiveness? Read our full white paper at http://bit.ly/21ReKhH.

New Purchase Insights: The On-Demand Fitness Industry

6 Minute Read

We are now in full swing of the New Year and heading into the summer, which means we are at the point of the year where people have actually gotten into a rhythm of committing to their resolutions -- or they have completely dropped them. One of the main resolutions that people commit to is fitness. Through our purchase insights, we found a new fitness trend gaining steam – on-demand and online fitness.

Payments to on-demand fitness services jumped to 7.7% of total spend on workouts last year. This is up from 4.8% two years earlier. We also conducted a migration analysis, looking at users who spent most of their fitness share of spend on big-box gyms and only dabbled in on-demand fitness in 2015, but left their big-box gym in 2016. Users who spent most of their share of spend on big-box gyms and only 12% on on-demand, increased their share of spend to nearly 32% for on-demand fitness after they left their big-box gym.

While we show that big-box gyms still held a considerable share in 2016, approximately 73%, we do show that percentage is dropping year over year.

We shared these fitness purchase insights with The Wall Street Journal and The Baltimore Sun. See The Wall Street Journal story, here, and The Baltimore Sun story, here.

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