xAd Study Reveals CTR Is a Poor Indicator of Mobile Ad Campaign Performance

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The 2014 Mobile Ad Measurement Study Analyzed 80 Mobile Ad Campaigns Across 12 Major Brands to Determine the Most Accurate Benchmarks for Measuring Campaign Success

xAd, the global location marketplace, today released results from its: Mobile Ad Measurement Study, which analyzed 80 mobile ad campaigns to determine the most accurate measurement metrics for mobile ad campaign success. The results are based on a Nielsen custom research study commissioned by xAd. Looking across over 200 million ad impressions from campaigns run for 12 major brands in the Retail, Restaurant and Auto verticals, Nielsen and xAd assessed multiple ways to measure campaign success, including Click-Through-Rate (CTR), secondary actions such as calls and navigation, and lift in store visitation post ad exposure.

In online advertising, CTR has long been a straight-forward and preferred way to measure banner ad engagement. This is because the act of clicking on a banner is an intentional two-step action and accidental clicks are not frequent. Since mobile advertising is comparatively new and digital in format, CTR quickly became the most popular way to gauge the success of mobile campaigns as well. The problem with CTR in mobile, however, is that when used as the only success metric for campaigns, it’s a glaringly inaccurate one. Not only do small touchscreens often lead to accidental clicks, inflating CTR, but the metric also fails to capture post-click engagements.

According to the study results, CTR appears to be completely unrelated, or even negatively correlated with Secondary-Action Rate (SAR), which reflects the percentage of secondary, highly-engaged actions like calls, directions and store visits. Furthermore, when comparing to Store Visitation Lift (SVL), or the ability for an ad to increase store visitation behavior, the study found that the lower CTRs were often associated with the highest lifts in visitation rate.

“In the same way that marketing needed to be re-evaluated at the advent of PCs, the mobile advertising industry needs to rethink mobile campaign measurement,” said Monica Ho, SVP of marketing at xAd. “With most purchases still happening offline, one of the primary goals of any mobile campaign should be to drive in-store traffic and sales. Clear indicators of purchase intent, like SAR and Store Visitation Lift (SVL), provide the most accurate picture of how well a mobile campaign has achieved this.

Overall, SVL, or the percentage of ad-exposed audience that visited a retail location divided by non-ad-exposed visitors, appeared to be the best purchase indicator for all verticals. SAR was a close second, indicating that consumers that take secondary action after viewing an ad are also very likely to convert.

The study also explored how marketers can best set up their mobile campaigns in order to achieve success. Driving awareness, engagement and conversions are separate goals, often requiring different techniques to ensure optimal performance. These techniques may include creative messaging, placement of message by time of day and supply mix. Given the variable relationship between the metrics, the study found that optimizing towards one measurement often negatively impacted other measurements, underscoring the importance of selecting the correct Key Performance Indicators (KPIs) for a campaign before it begins. The positive impact of optimization was most extreme for SAR, where this measure increased by up to 200 percent, while at the same time decreasing CTR by 25 percent.

To download the full results from Part 1 of the 2014 Mobile Ad Measurement study, Defining Benchmarks for Mobile Success, please visit: http://info.xad.com/benchmarking-study.

About xAd
xAd is the global location marketplace bringing together buyers and sellers with ad targeting solutions focused on driving in-store traffic and sales. The company is uniquely focused on capturing in-store visitation behaviors for ad targeting, insights and measurement solutions. The first to visualize real-time foot traffic, xAd customers include 1.5 million advertisers - including direct brand relationships, agencies, ad networks and other demand side media companies. Connect with xAd at http://www.xad.com, Facebook, Twitter and LinkedIn.

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