Revisiting Latency

A few weeks back I wrote a post explaining the virtues of latency and why it is key to online campaigns. However, like a cheap romance novel, I left you hanging at the end with how to interpret those latency numbers.

So, let's say that you are an online purveyor of widgets and you let your ad server tag your widget confirmation page. So, here's what you should be seeing:

• Number of direct widget sales
• Number of indirect or view thru widget sales
• Plus, you should be able to see the average time it takes to complete the widget sale or the latency time.

So, armed with a good calculator you add up your total sales and determine the % of direct widget sales and indirect sales. Now what? Well, here's your first quiz.

Quiz Question #1 - Is a 0%-5% indirect sales number good?

Answer #1 - Maybe not. Since a majority of sales should not be occurring in the same session (hell I abandoned a Target.com shopping cart tonight because their site was slow), you either have a tracking problem (dropped tag) or a placement that does not allow dropping a cookie at the impression level (paid search campaign on Google).

Quiz Question #2 - Is a 95%-100% indirect sales number good?

Answer #2 - In my experience, definitely not, but that doesn't necessary mean that the buy is bad; it just means you better research why you are advertising on the site. Here's why.

Since the indirect number is based on an impression seeing your ad it is assigned by your ad server and even though the sale occurred, you can't be 100% sure where the sale came from. Unless, you think that nobody is clicking on any of your ads and the sales are just magically appearing on your site from say, a television campaign (I'd love to see your widget spokesperson). Plus, when you add another site to your mix, you might see those sales originally assigned to your favorite site being assigned to the new site.

Quiz Question #3 - How long should you leave a window open to count a sale?

Answer #3 - It depends on what you're selling and what the placement is. For example, in two industries I've worked in, approximately 85% of sales occurred within 30 days and the majority of sales within 15 days. However, I've seen the vast majority of sales from my paid placement efforts occur within 2 days. So, I set my display advertising window at 30 days and my search advertising window at 2 days.

Quiz Question #4 - Should you pay a CPA for an indirect sale?

Answer #4 - I always did and in fact, I paid out on a 30 day window which seems awfully generous. However, if you've negotiated CPA (cost per acquisition) deals you'd like to get as much visibility as possible; you know for that branding thing which you denied occurs when you negotiated the CPA deal in the first place. The best way to get as much visibility is to count all legitimate sales and give the credit where it is due.

Ok, enough with the quiz. One more latency issue you need to watch out for is a sudden drop off in sales at a particular site when you add another site into the marketing plan.

Let's say you have a very successful acquisition campaign on www.nytimes.com that has been running for years and then you add in www.msn.com. All of a sudden that same creative, offer, landing page combination on www.nytimes.com no longer pulls the same way. Is it that the readers just stopped clicking on your ads or perhaps every Times reader has purchased your widget? Nope. The site has an audience overlap and those lovely www.nytimes.com view through sales just became direct sales on www.msn.com. Time to panic? Well maybe, but first determine what is really happening on your ad buy. Perhaps, you'll find that internet advertising has other uses besides acquisition, maybe even a little branding.

That's it for this week and I need to get going so I can finish burning a few more bootleg CDs. Take care and

PardonMyFrench,

Eric