Data Nugget: How Undervalued Is Display?

Most marketers, even search devotees, can agree that display advertising (some of it anyway) gets short shrift when it comes to conversion attribution. But how short is the shrift?

We asked Visual IQ, a well-regarded attribution platform, to share with AdExchanger readers some data to illuminate – broadly — how display and search perform in its clients’ attribution models, versus a “last ad” model. The findings below are from Visual IQ’s Marketing Attribution CPA Index, and will be the first in a quarterly data contribution from the company.

Visual IQ says 94% of online display advertising spend goes to placements with a “Cost Per Acquisition Skew” that is 70%+ lower than “last ad” based CPA. (CPA Skew is defined as the difference – high or low – between last ad based-CPA measurement and Visual IQ’s proprietary TrueCPA measurement.)

“What this means is that an extraordinary high percentage of display placements are being considerably undervalued using last ad measurement – leading to dramatically inaccurate optimization decisions when deciding where to invest future display spend,” says chief marketing officer Bill Muller.

By contrast, Visual IQ says only 0.6% of its clients’ display ad spend have a CPA Skew 70%+ HIGHER than last ad-based CPA. So, according to Visual IQ algorithms at least, an extremely tiny share of display spend is dramatically overvalued.

Meanwhile, in the paid search channel, the difference between low and high CPA skews is not quite as lopsided. Visual IQ says 10.7% of client spend goes to ad placements that have a CPA Skew 70%+ LOWER than “last ad”-based CPA. Compare this to 13.9% of spend on paid search placements that have CPA Skew that’s 70%+ HIGHER than last ad-based CPA.

Muller said, “What this means is that more paid search placements are being overvalued using last ad measurement than are being undervalued – leading to inaccurate optimization decisions – both high and low — when deciding where to invest future spend. The reason that the CPA Skew for paid search isn’t as great for the display channel is that search is a bottom of the funnel tactic (as opposed to display which is more of a top of funnel tactic).

He adds, “Display is also more of an impression-based tactic, and search is more of a click-based tactic. As a result, search is less disparate in its attributed vs. last ad metrics than display.

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