Latency What Is It Good For?

I was asked a few days ago to explain latency or view through/impression sales in a beautiful office overlooking the Potamic River. And, if you don't know either, I'm honored to be the first to explain it to you. Now maybe we can explain a lot of those unknown sales you've been tracking on your sales reports!

Have you ever been looking to buy something at your favorite e-commerce site while at work and just before you hit the next button, your pesky boss pops up from behind, so you close your browser. Sound familiar? Well it should. Industry studies (although an old one) show that 75% of all shopping carts get abandoned. Are we to assume that these items are never bought or are they sometimes bought later? Perhaps when the boss is at lunch?

Let's say (really write) that you are an online marketing manager for a shoe company and you use an ad server to place your ads on your media buy. A potential buyer clicks on your banner, visits your site, and just before they complete the shopping cart, that boss shows up again, and they abandon the cart. However, they show up the next day without clicking on the same banner and complete the sale.

Now what? Well, armed with a cookie courtesy of your ad server, a completed sale, and a click on a banner, your ad server should be able to determine which cookie completed the sale and which banner generated the sale. Therefore, you have a latent sale. Sometimes, those pesky consumers never click on your banner and then mysteriously arrive at your site and make a sale; this is called a view through or impression based sale.

Doesn't sound like a big deal to you? Well it should because I've seen average latent sales in the 55%-60% range and the % varies from site to site and from product to product; especially when the product has a long sales process or sign-up page. Several companies that I'm aware only started tracking latents recently and up until then had a large % of sales generated from unknown channels.

Think you know everything now. Well there's a lot more to it especially when it comes to interpreting the number and running campaigns using latent sales. However, that's for another week.

PardonMyFrench,

Eric