It's no surprise that retargeting specialist Criteo believes in the value of clicks -- that's the stock in trade. For many traditional marketers and advertisers, there is the view that online advertising is a venue for low-cost, direct response advertising -- as opposed to the lucrative, more creative brand marketing campaigns for traditional media. The industry itself generally accepts that this perception is the rule, and hardly an Interactive Advertising Bureau conference goes by where someone -- such as Kellogg's Bob Arnold, who received a roomful of applause last week for saying his company doesn't care about about clicks -- doesn't decry this view, all the while encouraging agencies and publishers to do better.
Criteo president and CEO Greg Coleman is someone who began his career on the traditional print ad sales side of the media business, and eventually led sales strategy for Yahoo and The Huffington Post as someone who was often credited with bringing major marketers to spend heavily on online brand campaigns. In a conversation with AdExchanger about the value of clicks, Coleman and Patrick Wyatt, head of Criteo's business intelligence, he sought to make the case for the click to those focused on e-commerce and branding efforts.
A Criteo study [PDF] released on Wednesday took aim at 2008 comScore research that said cost-per-click ads fail to monetize the full impact of online ad exposures. Criteo's response, which was based on of over $11 billion worth of e-commerce transactions and 142 million users to whom a Criteo ad was shown during one week in March 2012, suggested, among other things that people who click an ad are three times as likely to buy something than people who don't click. Criteo also disputed comScore's oft-cited finding that less than 0.1 percent of display ads are clicked, saying that almost half of all regular online shoppers click on Criteo ads alone.
"What we were looking at was a comScore study of 2008, which said in a nutshell, users don’t click on ads, and that the people who do click on ads – they're generally young, low income – are probably not your core shoppers," said Wyatt. "But we think we have the best database of online shoppers, so we decided to look at whether the kind of people who click, are also the kind of people who buy."
At the start of the interview, Coleman said there was one point he wanted to emphasize as well. "Back in the analogue days, people would look at coupon clippers as people who were not going to incrementally buy more, they were just looking to save on price. That idea changed. Our impetus for looking at the value of a click was to say, 'Forget about all the noise out there, let’s look at the facts about the value that clicks bring to marketers.'"
AdExchanger: When you say that clicks are valuable to brand marketers as well as e-commerce sites, and not a way of measuring cheap, commoditized inventory, are you talking about any particular categories of marketer? Or are you speaking in general?
GC: We have over 2,100 advertisers worldwide, and they all look at cause and effect: someone clicked an ad, what did they buy? You have all kinds of advertisers with very sophisticated attribution models, where they measure the value of a click and the ROI from a click that results from that. They have modeled their businesses to prove incremental sales uplift … very much the same way they measure search.
That said, we built this business primarily on three categories: retail, travel and classifieds. Those areas are much more easily measured and tend to lend themselves to transactions. Those are the ones that resonate the most at the bottom of the marketing funnel. As our company looks to the next generation of products, we’re looking more towards to the top of the funnel, with categories such as automotive and financial services, becoming much more open to a CPC model.
We measure sales, we don’t measure impressions. We measure did we sell incremental merchandise for the marketer that we’re dealing with.
So impressions don't matter? Only clicks do?
No, that's not it. The impression does bring value. But the impressions that are not clicked on are simply added value that’s free to the marketers using Criteo’s model. We charge purely on the cost-per-click. Let’s say our click through rate is 0.6 or 0.7. That means more than 99 percent of our ads aren’t being clicked on. We think there’s value in people looking for merchandise who don’t click. We leave it to the marketer to determine whether they would have gotten that incremental lift to what they would have gotten otherwise. I would say impressions are valuable. But the clicks are what’s definitive and provable.
So what do you say to those -- mostly major online publishers -- who say "abolish the click" as a measurement? They feel it doesn't clearly account for whatever branding value seeing an ad might have, and that the creative drive behind clicks is more of a hard-sell, than a more nuanced, subtle message of brand affiliation.
I made a living at Yahoo and The Huffington Post selling branding. So I’m not now going to say that everything I did in the past has no value. [Laughs]
We think the value of the pure branded impression is there. What we’re saying is that when it comes to return on ad sales, there’s a new way to measure it, and it's just like search: with a click. The tracing of the click to the cash register is simply undeniable. Clicks are clearly correlated with relevant intent. It also drives engagement in the upper marketing funnel. And we believe the right personalized creative can drive much higher clickthrough rates for branding as well as DR.
By David Kaplan