Today’s column is written by Tom Shields, Co-Founder and Chief Strategy Officer of Yieldex, an analytics tools provider for sell-side, yield optimization.
I am biased, I’ll admit it. I wrote the first technical impression counting standards for the IAB in 1998. And I think that trying to move the industry to “viewable impressions” is a bad idea, for three reasons: it won’t make any difference to marketing ROI, it doesn’t help bring dollars online, and it will be expensive and confusing to adopt.
Let’s start with the argument that using “viewable impressions” improves marketing ROI. Measurement vendors trumpet “CTRs are higher!” for the marketer, while “CPMs will rise!” for the publisher. Let’s do a little math. C3 Metrics claims that CTRs are understated by 179% because so many ads aren’t in view. Wow – CTRs will double! Except, publishers will charge double the CPM for “viewable impressions”, so the CPC (and ROI) is actually the same. On the publisher side, Magid Abraham presented to the IAB (PDF) an example of 35m premium impressions selling at $5 CPM netting $175k to the publisher. However, only 75% of those are “viewable” according to ComScore, so the eCPM is “actually” $6.67. Wow – CPMs will rise! Except that the publisher can only charge that higher CPM (CPV, actually) for “viewable impressions”, so their revenue stays the same. And somebody has to pay the measurement vendor. This is progress?
The real challenges we need to solve are laid out in the other 4 principles of Making Measurement Make Sense: rationalizing measurement across media, understanding online’s contribution to brand building, and generally making it easier to spend big budgets online and get ROI that makes sense. Let’s focus our efforts on these challenges, so we can grow the market to $200 billion for everyone.