Peter Drucker once said, “you can’t manage what you can’t measure.” But for marketers looking at the power of digital video with seemingly unlimited capacity for analytics, Drucker’s wisdom begs an obvious follow-up question: are we measuring and managing the right things?
Considering how much weight many marketers put on “vanity metrics” like cost per mille (CPM) and impressions, the answer is a resounding no. Marketers know this. In a recent eMarketer report, marketers rated a lack of consistent metrics as their number one concern. Tellingly, those same respondents cited additional concerns around transparency, viewability and fraud — issues that are only exacerbated by chasing impressions. If marketers want to address those concerns and better meet the challenge of driving business impact, they need to start thinking beyond vanity metrics.
What Are Vanity Metrics?
Vanity metrics is a catchall term for several of the most common metrics in digital media today. The two-second view, the number of impressions and CPM — to give a few widely used examples — give you a general idea of reach, but they don’t even come close to helping you understand campaign impact on business outcomes.
Obsessing over these metrics, to the exclusion of more valuable indicators, can boost a marketer’s morale, but it won’t boost the bottom line.
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How Do Vanity Metrics Compound Challenges Like Transparency, Fraud and Viewability?
Vanity metrics — particularly impressions — are often subject to inaccuracy and fraud because, without deeper engagement metrics, there’s simply no way to validate top-line claims. When brands chase vanity metrics, as is the case throughout much of today’s digital ecosystem, ads are more likely to appear on questionable websites and apps, attract invalid traffic and compromise brand integrity by appearing alongside unsavory content.
By shifting focus to deeper engagement metrics that capture meaningful interactions between brands and consumers, marketers avoid wasted ad spend and funding fraudsters — ultimately driving business outcomes and improving the digital ecosystem.
How Do We Focus on Metrics That Drive Business Outcomes?
Collaboration. Communication. Data. Marketers can’t be siloed from sales and product teams — otherwise they’ll have no idea what targets to shoot for. Representatives from marketing, product and sales need to discuss what their advertising goals are and why.
Naturally, each department is going to bring different perspectives to the table. There will be a lot of debate around what the path to success looks like. That’s a good thing. If your teams communicate as a cohesive unit, and bring data to the table about what drives customer journeys toward purchase that can back their recommendations, there’s no reason they shouldn’t come to a common framework on what marketing goals you are trying to achieve with digital video.
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What About KPIs?
Marketers should optimize campaigns toward business KPIs, not campaign performance. Remember, Drucker’s point — are you in the business of measuring and managing advertising campaigns, or are you in the business of driving business outcomes? On this point, marketing has gone through a revolution in recent years, but we’ve arrived at a place where the campaign is now a means to an end, and that end is always about driving engagement and business outcomes.
Of course, there’s a lot of variety when it comes to KPIs, depending on the needs of the business. If a brand’s objective is to drive awareness of a product, for example, the brand should measure engagement that illustrates the campaign impact on said objectives — like the number of product site visits or completions, or social shares of an ad. But no matter which KPI marketers focus on, they need to apply this thinking throughout the entire buyer journey, capturing data like direct sales, form completes and content downloads as they move further down the marketing funnel.
Equally important, marketers must tell a cohesive story across platforms, where each piece of the story leads to a unified goal. If your objective is to maximize CPMs, you may drive great CPMs but wonder why you aren’t moving the needle on anything which truly matters to the business. But if you’re driving toward a business-relevant KPI, you begin to tell a cohesive cross-platform story that moves the customer through their journey.
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Got It, It’s About Engagement. But How Do We Measure Engagement?
It’s not a one-size-fits-all approach. Each brand has a unique set of business objectives and campaign goals, and marketers will need to think through how to quantify engagement in a manner that best suits their brand. After all, what makes sense for a CPG brand, won’t be the same for an automotive or financial brand.
It’s vital that marketers get out of the business of measuring views and impressions that may, or may not, matter to their larger goals. Instead, marketers must measure what drives their specific business goals and provides meaningful results, so that they can better manage outcomes.