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Goal-Tracking is Vital for Your Ad Budget

By Posted in - Marketing on June 15th, 2017 0 Comments

Over the last few years especially, I’ve had a specific kind of conversation with multiple business owners. They were running expensive display advertising campaigns (think banner ads) that netted them hundreds of thousands of impressions a month accompanied by at least a few hundred clicks.

On the calls with these vendors, the ad managers would walk through a simple report, praising how much traffic the campaign generated and how far above the average industry standard metrics their campaigns were.

The problem was the business owners either weren’t seeing an increase in new business from their website or they weren’t sure how to attribute the business they were getting. Was it from the website or from one of their other marketing efforts?

Display Advertising is not Always Terrible

Let’s be clear: Display advertising in general is not necessarily a bad marketing decision in its own right. In many cases, pay per click advertising (like Google AdWords or Bing Advertising) is likely the more efficient and cost-effective solution because it targets intent and limits your spend to only the prospects who actually interact with your ad (a good sign that they are worth spending money on). While I was once a staunch believer that display ads were a complete waste of budget, I have recently seen clients see considerable success with display ads on local sites and with Facebook advertising. Sure, Facebook ads aren’t strictly display ads in the traditional sense, but the experience for the prospect is very similar.

The big differences with these approaches to traditional display ad campaigns is that they are more targeted than the typical display campaign, which uses an ad network to serve up your ads across hundreds of websites with very limited targeting criteria. If you partner with a specific website (perhaps based on subject matter or the location of your target audience), you are likely to see better results. And if you use the display ads on a social media platform like Facebook, you can leverage extremely robust targeting options to dial-in who sees your ad and when.

Going Beyond Clicks and Impressions

All of that said, whether you are taking my recommendation for display ads or working with a vendor to run a more traditional display ad campaign, you should establish clear objectives for the campaign and tie those objectives to data-tracking.

Clicks and impressions are good things to measure, but they tell a very small part of the story and are also easily faked. Click farms have been in business since the early days of the internet, and many display vendors are not actively working to ensure that the traffic you are getting is “good” traffic.

A click farm is like a digital sweatshop. Through a combination of sophisticated automation and cheap third world labor, click farms can be used to spoof a wide variety of data. This particular click farm was busted inflating traffic for a Chinese messaging app (check out that wall of smartphones!), but click farms can also inflate your Twitter following or get you a ton of gold pieces in World of Warcraft. 

I am not accusing your display ad vendor of choice of anything nefarious. Though some vendors are deliberately fraudulent, even a well-intentioned vendor can have their ad traffic corrupted by virtue of a website faking ad clicks to generate revenue (most websites today depend on users interacting with ads to make money, so sometimes they drive fake traffic through the ads to make them money), and the scale of these scams can be impressively large, like this $5 million, 570,000 bot operation out of Russia. Your ad vendor can be totally honest and upstanding while still delivering you garbage traffic.

To protect yourself, you need to tie your ad traffic to meaningful metrics.

Where to Start

Web analytics platforms are growing in complexity so that business owners can learn more about their traffic, their customers, and what they might do to generate more revenue. You don’t need a fancy proprietary solution to get started, though. Google Analytics can do a lot of heavy lifting for you.

Here is a relatively simple way to learn more about your ad traffic:

  • Identify your objectives. For most businesses, the objective is to generate a lead, establish a customer contact, or get a sale. If the goal of your ad is just to “generate exposure” we need to have an entirely different conversation. The short of it is that you can accomplish your general branding and awareness goals while at the same time driving actual business. An ad vendor that talks about the value of “exposure” is likely more interested in not being accountable for actually growing your business than in doing the right thing for you.
  • Use a unique landing page for each campaign. Ideally your landing page will have text and visuals that speak to the unique audience you’re targeting. If you drop any user on the homepage, regardless of their quality, your return will be much lower than if you had used a landing page.
  • Set up a UTM code specific to your vendor, using your landing page, to make tracking traffic extra easy. A UTM code doesn’t change the experience for your prospect at all (beyond making your URL a little bit longer), but it makes it a bit easier to isolate that specific stream of traffic in Google Analytics. Go here to learn more about UTM codes.
  • Set up goal-tracking in Google Analytics based on your specific business goals. Goal-tracking essentially establishes a “finish line” for your users so that Google Analytics can tell you exactly how many people hit that marker and give you an insight into the journey they took to get there. Goal-tracking is especially easy if you are generating a lead with a capture form or have a clear “thanks for your purchase!” page. If your sales process is a bit longer and has multiple touch points, you might want to investigate event-tracking to keep tabs on things like mobile phone calls or email clicks. Here is the Google resource on goal-tracking and the Google resource on event-tracking.
  • Bonus: Run A/B tests on your ads and landing pages to improve your performance metrics. An A/B test is where half of your audience sees one version of your campaign whereas the other half sees a different version, allowing you to compare the results and pick the version that works best. Keep this simple to start. Google offers tools on how to do this, and most content management systems have some plug-and-play tools for making this process simpler as well.

When you have conversations about your advertising data, whether internally or with your vendor, use these systems to expand the conversation to include conversion rates. How many users did the thing you wanted them to do?

How to Identify Problems

If your advertising campaigns are driving a lot of traffic but you aren’t seeing any conversions from that traffic, one of two things is wrong: Either the ad traffic is not worthwhile or your website is not effectively engaging the audience you are generating. Neither of these alternatives is cut-and-dry, so let’s unpack them.

Ad traffic that is not worthwhile might not be good because the traffic itself is from bots, in which case nothing you do will change that, or the way you are targeting/serving your ads is not properly aligned with the audience you want. You might be targeting the wrong people, or you might give prospects one idea with your ad but when they get to your website they don’t feel like they got what they were promised (so they “bounce” out).

Adjusting your ads and the targeting should help you to identify whether these culprits are to blame. If you significantly change your creative and your targeting and the traffic is largely the same month to month, your vendor is either putting extra oomf into the frequency to meet their numbers, or your traffic is getting spoofed.

If your website is not effectively engaging your audience, you should go back over your landing pages and try something new. Change up the message, swap out some visuals, lean more on emotional connections and impactful value propositions. You should be suspicious of your content being the failure, however, if your website is converting for other campaigns that theoretically serve the same target audience. In some cases, your target audience might simply prefer one channel to another, so knowing what to cut is good. In other cases, you the traffic you are getting is simply not worth the money you are spending on it.

In all of these scenarios, A/B testing and robust conversion tracking will help you to make more educated decisions with your budget.

What Next

Fair warning: Your display advertising vendor will get really upset with you if you suggest that their traffic is not valuable enough for you to continue paying for. You will hear arguments about the value of exposure and branding, and you will hear arguments that your data does not reveal the total picture of your business. You might even hear arguments of how many times customers need to visit your website or see your brand before they take a measurable action. In all cases, I urge you to rely on what you know for sure: How well the ad campaign is or is not directly driving business.

It’s true that winning a prospect over is not a one-and-done process, but if your ad campaign is generating little to no meaningful traction, that money is probably better spent in another channel.

Once you implement these recommendations, you should start tracking metrics like cost per acquisition (CPA, or how much you have to pay to get a customer) and total lifetime value (TLV, how much a customer will spend with you over the duration of your relationship). We’ll get into those metrics more in the future.

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