Measure your audience, or measure your losses

What is advertising actually about? What do advertisers really want to achieve? Instead of a “depends on” answer, let’s try to keep it simple.

Advertisers run ads to sell more products. They don’t run ads to generate ad impressions. They don’t run ads to get someone to click on them. They don’t run ads to complete video quartiles. And they certainly don’t run ads to produce random columns of numbers in their DMP. These are all just proxies for the real goal: more sales of the advertised products.

So, how do you get there with advertising? First and foremost, you must ensure that as many people as possible learn about the advertised product. And since all products are relevant for a certain group of people, it should ideally be as many people as possible from this group. Or to put it another way: the primary goal to be maximised and a necessary condition for everything afterwards is the net reach in the target audience. This is a no-brainer: the more people from your target audience you reach, the greater the probability that your products will be bought.

And if the net reach in the target group is such an important metric, what is the logical conclusion from this? Well, then you should initially focus on measuring this metric when running ads.

In addition to the net reach, it is also important to understand how often each person in the target audience has seen the ad. Most messages need a certain frequency to have an effect. But be careful: the additional benefit of repeating exposures quickly decreases and generates unnecessary costs.

Navigating the fragmented media landscape

These are basics and have been common practice for a long time – at least for traditional media such as TV. Online media, on the other hand, has been – and still is – subject to very technical evaluation standards due to the history of the genre as a direct response channel that was euphorically celebrated at the beginning because of its all-measurability and all-traceability. However, just because you are technically able to measure everything and collect data down to the last decimal, it doesn’t mean that this is meaningful.

Of course, it is easier to count impressions, clicks, landing page visits, conversions, etc., and for performance advertising, this may well be justified, but online media has grown up so much in the meantime that one should expect – at least for brand advertising – that it is evaluated according to the classic standards of net reach and frequency.

Yet many advertisers cannot make such an important and seemingly simple statement about their digital advertising campaigns as the following: “With my campaign, I reached 80% of all Germans aged 18-49 at an average of six times.”

With that said: Measuring net reach and frequency has become far more complicated with online media than with traditional media due to the increasing fragmentation of both the media and device landscape. Different devices and channels create an almost infinite number of media offerings, all producing separate data.

So, how are you supposed to find out how many “young men between 20 and 39” you have reached in total? Who knows what the overlap is across all the different devices and channels? If a 25-year-old man is watching an advertiser’s ad in a CTV app on the TV but has seen it before on an online news site on his laptop and on his smartphone in a social media app, does the advertiser know that he has reached one person three times, or does he think he has reached three people once each? The implications are far-reaching!

The business value of cross-media measurement

According to a study by Oxford University, the average media plan could be 2.6 times more effective at building reach with a different media mix. This means that you could generate the same reach with only 38% of the budget investment.

But in order to unlock this untapped potential, you need to know – across all devices and channels you are advertising on – how many you are reaching (deduplicated), how often you are reaching them and, very importantly, how each media is contributing to the overall result. So, how much did the YouTube ads contribute to the overall net reach, and how much did the Facebook and Instagram ads? How much lower would the total net reach have been if I had left out the programmatic ads? Only with answers to questions like these you can make a data-driven and fair comparison between each media and determine which was most effective, helping you allocate your budget more efficiently next time.

So, what do you need for this, apart from the basic understanding that the net reach and frequency in the target audience are crucial metrics for measuring the success of digital advertising? A comprehensive cross-media measurement platform that is based on:

And finally, some patience to get closer and closer to the optimal budget allocation.

And the reward? Greater net reach in the target group and a reduction in excess frequency, leading to a reduction in costs.

Hence, you have the choice: measure your audience, or measure your losses. Kind of a no-brainer.

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