Looking Past CPM to Engagement
In a recent interview, the chief of media for MasterCard was sure to mention that he did not consider CPM “dead.” This is a common theme in the blogosphere, that one form of advertising is “dead” while another is inevitably much better. It used to be email, now it’s CPM. MasterCard’s Ben Jankowski said that there are actually a lot of factors that determine the success of a campaign. So, while he may no longer use CPM as the end-all strategy, he is looking at its impact on overall client engagement. That’s an important statement, considering that MasterCard is one of the biggest advertisers in the world.
Not only is CPM not dead, it’s currently ranking as one of the fastest growing channels in media. As companies shift away from television ad spend toward the Web, we see more display advertising with rich media. Engagement is becoming an important metric, but banner advertising has also kept up with the trend.
More display networks, especially those that utilize buy-side-platforms, are using targeting methods to accurately reach certain audience segments. This level of targeting adds new dimension, so that advertisers aren’t just bidding on keyword and guessing at intent. Marketers can now look at income level, gender, location and more. Even user interests are easy to filter for under the proper conditions. These developments have enabled display marketers to see the impact their ads have on audience engagement, and cut out views that aren’t relevant to their campaigns. While this directly affects CPM, it’s about reaching the right viewers.
Retargeting allows advertisers to continue to reach out to a prospect with targeted offers. Say a customer leaves during the shopping cart step. A retargeted ad can direct a “free shipping” coupon to that lost customer in an attempt to salvage the sale. This extra step has allowed advertisers to hone in on the specific driving factors that make users motivated to buy something. Retargeting is also more cost-effective than standard display advertising. You will need to run both in order to use retargeting, but it does offer a second chance at a fraction of the cost.
CPM is definitely not dead, and MasterCard is standing behind that statement. However, CPM is no longer about the right keyword. The art of advertising is all about intent, and advertisers have increasingly larger toolsets to help make those decisions.
Ted Dhanik is a dog lover and confirmed advertising addict, who is also the co-founder of engage:BDR. Ted Dhanik sold advertising space for MySpace before creating his own company. Ted Dhanik is based out of Los Angeles, where engage:BDR is headquartered.