- Category: May - June 2009
Get an overview of the different categories of tools for performance measurement and optimization of online marketing disciplines. The following will give you some further insights into tracking performance and solution approaches for the still frequently occurring measurement errors.
What figures are relevant in the performance marketing?
In order to measure the success of an online marketing campaign wisely, first of all the key figures have to be defined, which is decisive for the performance of the entire campaign. Crucial in performance marketing are in the end of course sales or leads. However, by measuring only these two figures exclusively, important information tends to be disregarded. So, the tracking ideally already starts with the measurement of ad impressions and clicks and will continue throughout the whole online process to uncover potential optimizations in all stages of the campaign. If in addition landing pages and online processes are continually optimized, most probably even more leads and sales opportunities will open up.
Tracking of various disciplines in performance marketing
In general each online marketing tool uses a unique system for control and optimization. Whereas the standard tools in performance marketing are search engine marketing and affiliate marketing, the tracking in search engine marketing is nowadays mostly carried out by the so-called bid management tool. Besides the control of the click rates and the management of keywords and ads, it allows as well the measurement of the success of individual campaigns and keywords based on ROI.
Affiliate marketing normally uses public affiliate networks and/or private partner programs, which allow besides program and affiliate management, the tracking of ad impressions, clicks and leads/sales. Sometimes display campaigns can fall into that field of performance marketing, too, where the tracking is done by using AdServer. These tracking tools settle the controlling of the advertising, track ad impressions, ad clicks and the resulting leads/sales. Based on the results, the banner delivery can be optimized if necessary.
In general, the measurement of all the above systems occur by using cookie tracking: The click on an advertising material calls up a redirect on the tracking server, which places on the computer of the user a cookie that serves the subsequent recognition of the user. How long the user is allocated to the corresponding campaign depends on the cookie lifetime, which can be defined freely. If the user runs through the entire online process during that time, a tracking code will be called up after its completion which passes the transaction (for example, opening of a bank account or newsletter subscription) to the tracking system. With the placed cookies on the user’s PC, the transaction can now be assigned to the respective campaign.
Pitfalls and problems in tracking
When it comes to Performance Marketing in particular, the precise tracking and accurate allocation of transactions to specific tools/campaigns is decisive. However, when it comes to cookie tracking, there are always measurement errors, too. The experts’ opinions differ regarding the exact dimension of these inaccuracies, but it is believed to vary from 5% to 20% depending on the campaign.
There are several reasons for these errors in measurement, but the main cause is for sure the use of different measuring systems. Although all tracking systems ultimately work according to similar principles, nearly every system is different in its measurement methods, so that most probability, different tracking systems lead to deviant tracking results.
The pure tracking cookie can be amended, for example, with the so-called session tracking, which means that users who do not accept cookies or have deleted their cookies will be searched out. The additional use of session tracking reduces in this way inaccuracies caused by those users who deny or delete cookies.
Overlapping of measurements are still giving campaign managers headaches when tracking leads. If an advertiser doesn’t place a tracking point in position, the tracking system will give out a separate tracking code for each used online marketing tool, after the completion of the transaction on the ‘thank you’ page. If the user has been previously marked by different cookies, the same transaction will be tracked multiple times, resulting in overlaps.
These duplicates have to be eliminated subsequently by assigning each transaction to a channel. Usually, this assignment comes about after the "last cookie wins rule”, which assumes that the last advertising material contact is the decisive factor that tips the balance for the transaction. Besides these clear allocations to exactly one channel, some marketers are now also distributing the transaction success proportionally to all channels with which the customer has been in contact with before the purchase. In doing so, they normally grant the latest advertising material contact the largest percentage of success. The minimizing of the number of measurement impreciseness and errors remains a major challenge despite sophisticated techniques of the performance marketing. An important step towards accuracy would be certainly the use of multidisciplinary tracking tools.
Comprehensive tracking of all activities and disciplines
As shown, each individual performance marketing discipline has its very specific requirements for campaign management tools, but the perfect system that covers all the requirements still doesn’t exist yet. For an optimal campaign management, the use of multiple tracking tools is therefore unavoidable.
However, this separation of systems is problematic if in addition to the measurement of the above mentioned figures, a cross-channel analysis is conducted as well while doing the performance measurement. For this reason, the amendment of each campaign management tool through cross-disciplinary tracking and Web analysis systems make sense. In this way, coherence between individual channels can be detected in the majority of transactions and receive formal approval through multiple contacts of the user with different online campaigns.
To be able to evaluate the actual contribution of individual performance measures to the overall success, the analysis of user paths is of great importance. So for example, it becomes very clear pretty fast which individual measures should be weighed stronger as they often produce the initial contact of a user to the campaign and thus the basis for the subsequent transaction. Other measures in turn can contingently be overrated if considered alone. The measurement of click and conversion paths should ideally cover not only campaigns, but continue on the website. The combination of campaign and Web analytics data provides in this way the optimal basis for the overall view and assessment of the used measures.
Such a cross-tool system can be used to minimize measuring overlapping just as well. If the system is used as a tracking point, doublets in the external systems (affiliate networks, bid management systems, etc.) can be excluded: On the checkout page of the online process, the tracking codes of all external tracking systems no longer will be delivered, instead, only the code which is absolutely attributed to the transaction according to a pre-defined logic. So, duplicate transactions in different systems can be avoided, thereby increasing accuracy significantly. Some systems use in addition to cookie tracking other tracking technologies and improve in this way the accuracy significantly. In order to be able to use cross-channel tracking systems as management information system as well, the ability to import external data should be ensured. This allows the tracking data, among other things, to get enriched and analyzed accordingly by monetary data from possibly existing internal controls.
Each campaign management tool in performance marketing meanwhile meets the requirements for the tracking of rudimentary data, needed for campaign management and optimization. What could become a problem is the use of many individual stand-alone solutions if you plan to compile cross-disciplinary evaluations. However, since there is no perfect solution, a supplement by a cross-disciplinary tracking system definitely makes sense.
Especially for performance marketing agencies such a solution is essential to ensure a quick and comprehensive overview of the relevant campaign data. Moreover, these systems give important insights into the coherencies of used measures and allow in this way a perfect coordination.
Performance marketing is based on the possibility of measurability of online marketing efforts. Measurement accuracy by advanced technology, comprehensive data collection across the entire conversion path (ad impressions, clicks, online process to the point of the completed transaction), as well as extensive reporting capabilities are the fundamentals of successful performance marketing and will increasingly gain in importance in the future.
By Daniela La Marca