Report: Focus on Click-through is Misguided

Consumers who view an ad, but do not click-through, are more likely to buy or register at the advertiser’s site, than those who do click, according to the first quarter Online Advertising Report by Engage‘s AdKnowledge .

It’s a finding that vindicates industry players that have long stood behind the value of ad impressions, and calls into question the cost-per-click model.

The study found that users who only viewed an ad, but did not click, purchased or registered 33 percent more, than users who clicked on an ad.

“This data yields two important conclusions. First, the potential ROI impact of Internet advertising is much greater than previously thought. Second, advertisers that focus only on clicks or even post-click conversions may miss vitally important effects of their advertising campaigns,” said Steve Findley, vice president of AdKnowledge Analytic Services.

The report also found that the number of ad-supported sites and networks on the Internet is experiencing rapid growth. In the first quarter, the number of sites and networks grew by 723, a 22 percent increase.

The growth of advertising availabilities didn’t appear to be driving down CPMs too terribly. Average CPM rates remained nearly the same in the first quarter, falling only .48 percent to $33.59. The fourth quarter 1999 rate was $33.75.

Another interesting conclusion of the report was that ad deliveries, click-throughs, and customer conversions peak during the lunch hour mid-week. The weekend was the slowest time. Thirty-eight percent more activity took place at noon Mondays through Wednesdays, compared to noon on Saturdays.

The study comes out of AdKnowledge’s analysis of data gathered from the 4,000 sites and networks in its system.