Performance marketing: for advertisers who demand more

Performance marketing: for advertisers who demand more

At LifeStreet, we often talk about how, in this digital age, online marketers should demand more from their advertising investments. We believe that advertising partners should be held accountable to the advertisers who trust them with their businesses, and as such the payment metrics should reflect that increased level of accountability. Specifically, we believe that online marketers should pay only for what matters to their business (like installs and engaged users) – and never for what doesn’t (like clicks or impressions).

Not convinced that clicks and impressions are poor markers for customer conversions? We pulled together some internal data to illustrate just how poorly they correlate with app conversions.

Impressions, clicks, and conversions: not a match made in heaven

For this blog post we compared click-through and conversion rate[1] data from five major Facebook gaming applications who advertised with us in July 2012. We then averaged the click-through and conversion rates among these five applications to determine if there was any correlation between these two rates. Among this test sample, it is clear that click-through-rate was not predictive of conversion rates or vice versa. For example, Advertisers C and D both had click-through rates above average but conversion rates well below average, while advertisers A and E had below average click-through rates but above average conversion rates.

If your goal is to acquire customers, then pay for customers — not clicks.

Data based on a subset of LifeStreet Media’s July2012 Social data

Click rates vary among countries and other demographic factors

To further illustrate the lack of correlation between clicks and conversions, we took another data sample, this time of mobile data from the US and Japan. Among this sample set, the Japanese users clicked at more than triple the rate of the US-based users, but the conversion rate among US-based users was greater than the conversion rate of the Japan-based sample set.  (Note: in both groups ads, landing pages and apps were localized.)  In this and many other instances, advertisers paying on a pay-for-conversion rather than a pay-for-click basis would see much greater returns on their marketing investments.

Data based on a subset of LifeStreet Media’s July 2012 Mobile data

As illustrated by these examples, impressions and clicks don’t correlate to conversions. If you’re looking for customers, why pay for impressions or clicks?

At LifeStreet, we believe you should demand more from your advertising partners. With LifeStreet and our range of performance-based pricing options, you pay for results – true, meaningful, high impact customer acquisition results –to ensure you’re getting the most out of your advertising investment.

 


[1] At LifeStreet, a “conversion” equals the achievement of an advertiser’s goal. This is typically an install or a post-conversion event, such as the completion of a tutorial or specified level in a game

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