I was around when trade magazines first set up their websites, and when independent online-only competitors set up as an alternative. The web should have quickly wiped the floor with printed trade magazines. The fact that so many magazines still exist proves how badly wrong online publishers got it. Or did they?
Trade magazines going online didn’t want to kill off their print business. So they just saw the online stuff as a cash cow to milk extra money out of their advertisers. Nobody even considered putting the advantages of online marketing to work, such as helping advertisers to set up systems which would track through their advertising to direct sales. That would cost money, and might even backfire badly.
So instead, the trade magazines online just moved their print model over to the web. “We’ve got some pages”, they said, “so come along everyone, put your ads on them and we’ll charge you a random amount of money.” They should have added: “You won’t have any idea if the advertising has worked or not, and even if you demand to know the number of clickthroughs to your website, we’ll just give you some nonsense figure.”
Then along came Google with its “pay per click” advertising model. This ought to have killed off fixed payments for banner ads forever. But it didn’t, and the reason for that was the continued lack of desire from advertisers to bother with measuring the response to their ads, and the continued existence of so many unscrupulous advertising salesmen. It’s incredible to me that – in 2014 – you can still go out and pay £500 to put a small message and your logo on a website, with no guarantee that anyone will even look at it, and no way of knowing if they did anyway. Who would waste their money like this? Thousands of advertisers every year, it would seem. That’s the power of salesmanship.
What’s worse, the only response normally quoted for these adverts – the clickthrough – is made out to be as good as an actual product enquiry. It’s nothing of the sort. It’s just someone who wants to read a bit more about what you’ve got. That’s a big step away from getting in touch.
We find that when you track banner ads properly, you find that a 0.1% clickthrough rate isn’t uncommon. That’s one person in a thousand seeing the ad who clicks through. Fair enough, if you got 20 enquiries from an advert in a 20,000 circulation print magazine, you’d think that was alright. But these aren’t enquiries – they’re clickthroughs. They were intrigued and distracted with the few words you had space to offer them. When we investigate further, we find that perhaps only one in five of them actually look around your website once they’ve clicked through. And only a small fraction of these make an enquiry. We’re probably down to one enquiry for every 50,000 views of the banner ad.
That’s OK, if you’re only paying for the clickthroughs, as happens with Google AdWords and other pay-per-click services. Pay £2 per clickthrough, and a real enquiry might have cost you £100. But for fixed-rate banner ads, your £100 enquiry requires 50,000 views, and looking at the figures from most of our clients, they’re not getting anything approaching that number. I regularly see companies paying, say, £200 a month for a banner advert, and getting 3 or 4 real clickthroughs for the privilege (which means the ad was probably only shown 3,000 or 4,000 times). Not only is the 3 or 4 figure (as measured in the advertiser’s Google Analytics) disputed by the publication, which claims it was 30 or 40, but the clickthroughs are somehow sold back to them as being the equivalent of enquiries.
In reality, if you got 3 or 4 clickthroughs from a banner ad each month, you’d probably expect no more than 1 real enquiry a year. So we might consider that advert to be worth £100 a year, or about £8 a month. A long way from the £200 a month which many online publications seem to be getting away with.
Online advertising, when done well, left print advertising in the dust years ago. But beware: there are people out there armed with “fixed rate, no guarantee” ratecards who can – incredibly – make online advertising really poor value.