Study Finds RSS Ad CTR Leveling Off

Click-through rates for most standard online image ads have languished at less than one or two percent for years, but some ads placed in RSS feeds are garnering much higher CTR. The “Pheed Read Spring 2006” report released today by RSS and blog marketing firm Pheedo shows that the average CTR of “standalone” RSS ads is 2.76 percent, while “inline” RSS ads, or ads within an individual feed post, are getting a .45 percent CTR. The quarterly study looks at RSS ad and content CTR and how those rates are affected by position, frequency and feed content vertical.

According to Pheedo’s December 2005 report, standalone RSS ads grabbed an average 7.99 percent CTR and inline feed ads got a .85 percent CTR on average. In the new study, these rates dropped 65 percent and 47 percent, respectively. The company believes that feed ad CTR will continue to normalize; however, Pheedo VP of Marketing Bill Flitter predicted, “I think it will be a much, much less significant drop going into the next quarter.”

Ad frequency is a factor. Publishers that placed inline ads within every post saw an average 1.75 percent CTR. That number fluctuated as ads were staggered between every second and third post, and so on. Relatively higher click-through rates came from ads placed in every fifth post (1.56 percent), and every tenth post (1.09 percent).

“This is somewhat driven by publisher preference,” observed Dana VanDen Heuvel, director of business development at Pheedo. He noticed that in recent months publishers have begun placing more ads in RSS feeds to boost ad revenue. “This is indicative of a shift in publisher savvy, publisher intelligence, as it relates to RSS. It illustrates publishers are trying to get the most revenue from their feeds,” he added.

Feed content itself had an impact on ad CTR, too, according to the report. Ads placed within Comics and Humor; Travel; and Kids and Family feed content verticals spurred the most average CTR at 9.62 percent, 8.54 percent and 7.61 percent, respectively. Games; Arts and Literature; and Sports and Recreation came in at over 4 percent, while Politics and Consumer Technology got an average CTR of less than 1.5 percent.

According to Flitter, most RSS feed advertisers fall into the Auto, Consumer Electronics and Finance categories.

“There’s a very small group that’s currently using RSS feeds to advertise,” said JupiterResearch Analyst Emily Riley. Most, she continued, are looking to target early tech adopters like Web developers, designers and others in technical fields.

The question remains: are RSS advertisers concerned with CTR more than other metrics for determining ad effectiveness? “It’s based on the goal of the advertiser,” said Riley. “If the advertiser is looking to increase click-through rates for whatever random reason than that would be great.” Although she believes that ad impression and CTR are often used as initial ways to measure campaigns, most advertisers, including RSS feed advertisers, typically graduate to more sophisticated metrics like conversion, brand awareness and purchase intent.

The report findings may surprise those in the online publishing world who have debated which is best: distributing complete RSS feed content or a brief summary or introduction. On average, it was discovered, summary feeds got a median CTR of 8 percent, while full feeds garnered a 10 percent median rate. The truth is most RSS subscribers, 90 percent, read feed content in their news aggregator interfaces regardless of whether full or partial posts are published there.

“This is actually positive for advertisers,” noted Pheedo’s Flitter, “because they have a captive audience” within the news aggregator environment. VanDen Heuvel added, “This is going to be the consumption vehicle of choice.”

Pheedo sampled 50 feeds for the study, 84 percent of which featured summary posts.