Friday, April 10, 2009

OnlineSpin: Total Time Spent Online Is Not Indicative Of Online Media's Worth

Last week Max wrote "A Note About Tracking Cookies."

Mike John-Baptiste wrote in response, "I agree. This is a subject I really struggle with, as a person who wants to see online publishers make money and online advertising flourish -- but at the same time I am a consumer and a person and I absolutely hate the fact that companies take advantage of people's lack of education and abuse their role. I really don't know which force pulls me stronger. Perhaps the industry just needs to figure out other ways to get at understanding the audience the old-fashioned way: a combination of gut instincts, analytics and extrapolations.

The openess of the web has borne a new generation of people who are comfortable sharing themselves and don't mind if keeping the system alive and kicking means that you, the user, has to be better understood.

So, yes, hooray for AllThingsDigital as I for one will still allow myself to be cookied and applaud their honesty...."

Friday, April 10, 2009
Total Time Spent Online Is Not Indicative Of Online Media's Worth
By Max Kalehoff

David Meer, chief research officer at Enfatico, observes many frustrated and idealistic people in the online media business. Particularly ones that persistently point out the discrepancy between time and money spent online: "Despite the fact that people spend around 30% of their media time online, advertising online captures less than 10% of media budgets-and the gap has persisted over the last several years."

Which begs the question: Why do people automatically and narrowly apply time spent in a given channel as a proxy for value and justified ad dollars? It boggles my mind. In terms of branding and customer acquisition goals, I will gladly pay a lot more for one channel with almost no time spent versus one with a lot of time spent -- if the former were to perform better against my objectives. And objectives and their achievement should factor in return on ad spend, including profitability to my business. It's that simple.

So what best explains this lopsided online-offline equation? Meer says that both traditional and online advocates tend to be parochial: "We know that online allows us to measure conversion and business results with brands immediately and with more specificity than any other medium. Importantly, it also enables two-way conversations between customers and brands. But TV remains a powerful communications vehicle, one that consumers still embrace. What's missing so far is better knowledge of how the two work together. When marketing is truly integrated, offline and online work together seamlessly, with robust analytics to make sure the allocation between them leads to the best outcome."

Meer's right. Advertisers are stymied by their inability to understand and properly attribute the impact of individual and collective advertising investments toward predetermined goals. When that happens, we'll see an adjustment to a more enlightened media cost-to-value ratio.

But beware: in the near term, greater value may be reinforced with offline channels, not online. But in the mid- to long term, the dichotomy of online versus offline will blur and disappear -- if for no reason than because the world's going digital. Theoretically, more media on a single digital grid (or compatible ones) will yield centralized, smarter marketing investments.

What do you think?


Max Kalehoff is vice president of marketing for Clickable, a search-marketing solution for small and mid-size businesses. He also writes

Online Spin for Friday, April 10, 2009:

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