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AdNetwork analysis frequency optimization

Ad Network analysis frequency optimization

Before spending on budget online advertisers looking for some ROI in terms of eCPL or eCPA targets and on the basis of reports renewing the campaigns. Komli media provide us a report which explain how Frequency Optimization Maximizes Efficiency of Online Marketing Spends.

Frequency Optimization Maximizes Efficiency of Online Marketing Spends
The findings reveal that the highest click through rate was recorded on the first impression, while the highest conversion rate was in the 2-5 impression range.


October 13th 2008 (Mumbai, India) - Komli Media, India's leading digital advertising and technology company, today announced the results of its case study analysis of click and conversion rates at varying frequency levels. The study also analyses a click distribution to evaluate the trade off between efficiency and higher conversion rates. Komli Media's findings illustrate why advertisers should include frequency targeting as one key parameter while planning their media buys.

The study draws upon data across the entire network, including regional data from India & the United States. Data was recorded from a randomly selected thirty days during a ninety day time period from June 1st to August 31st, 2008.The results were:

Click Through Rate:
Frequency Network(%) India(%) United States(%)
12.1022.8750.352
2 - 50.0380.3980.211
6 - 100.2430.0270.129
11 - 250.1410.1550.09
Table 1
A run on the entire network boasts the highest CTR of 2.1% at a frequency of one impression per user, which is 8 times higher than the next highest CTR. Regional analysis similarly, recorded highest CTR on the first impression and then dropped steadily as frequency increased. Declining click through rates suggest that a frequency cap could be put in place to prevent wasting impressions upon viewers who are significantly less likely to click on the advertisement.

Conversion Rate:
Frequency Network(%) India(%) United States(%)
14.2064.564.76
2 - 57.46210.115.524
6 - 107.4179.9213.126
11 - 255.2637.3292.498
Table 2
Upon the entire network the highest conversion rate of 7.46% was achieved during the 2-5 impressions per user range, followed very closely by the 6-10 impressions per user range. India recorded its greatest conversion rates of 10.11% in the 2-5 frequency range as well. Interestingly, this is more than double the conversion rate recorded on the first impression. Only slight drops in conversion rates occurred in the 6-10 frequency range. For instance, India only experienced a 0.18% drop. Campaign frequency targeting therefore should include the 6-10 frequency range.

Analysis:
To maximize efficiency of their media spend, the advertiser faces a trade off between media spend and impression frequency per user. To evaluate this trade off we look to the click distribution which details what frequencies yield the greatest number of clicks. Below is the click distribution for the entire network:


Figure 1

For the entire network, the click distribution reveals a pattern of negative correlation between click volume and frequency, meaning that as frequency increases the volume of clicks received decreases.73% of clicks occur during the first impression and 89% of clicks occur when the user views the ad with a frequency capped at five. Such data viewed in conjunction with the click rate allows advertisers to make precise decisions regarding their ad buy.

Inferences:
  • If the goal of your campaign is to reach the maximum number of users at the lowest cost then frequency targeting should be capped at one.
  • While evaluating CTR and click volumes as a measure of success for branding campaigns, the frequency cap should be set at five. This captures 89% of the click volume without wasting money upon less efficient impressions in higher frequencies.
  • Lead focused advertisers buying on a CPM basis should set their frequency cap at 10, to access the higher conversion rates at greater frequencies. Even extremely conservative media spends should in no case set their frequency cap lower than five impressions.
  • Cost per Action campaigns focusing upon greater conversion rates can utilize the data to reduce creative blindness. To avoid blindness in the higher frequency range, the advertiser can design their campaign to show different creatives at different frequencies. The first three creatives could introduce the product while the subsequent creatives could introduce pricing.


About Komli Media
Komli Media is a digital advertising and technology company enabling marketers to reach and acquire their audiences and publishers to maximize their revenues. Komli Media powers Indias only ad network platform with solutions across lead acquisition, targeting, rich media and measurement. Headquartered in Mumbai, with an engineering centre in Pune, Komli Media is also located in Delhi (India) and New York (US). For more information log on to http://www.komli.com.

This originally posted as Komil Media News . It has been reposted with the author’s permission.

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