Attribution: New Flavors, Same Problems (and Then Some)

unnamed123 Jim Moar is CEO of OptiMine Software, Inc. OptiMine Software’s measurement and optimization platform helps digital advertisers maximize display and paid search financial performance. Its unique, cross-channel analytics break the cookie barrier and set a new standard in digital advertising measurement and optimization, leveraging atomic-level, predictive modeling and unique Value per Impression (VPI) methodology to measure the cross-channel value of ads—across all devices—and optimize accordingly for extraordinary in-channel and cross-channel results. This is Jim’s first contribution to The Makegood. 

Last year advertisers spent over $40 billion on digital advertising, according to eMarketer research, but only succeeded in measuring the value of about half that spend. Measuring the value of all forms of display ads is an advertiser imperative, but the current attribution paradigm is flawed and the new schemes being put forth by the likes of Google, Facebook or Microsoft won’t solve the measurement problem, either.

Advertisers are painfully aware that cookie-based attribution schemes, while useful for targeting, were fundamentally flawed from the start as a way to measure ad value. Cookie data, at its best, was short-lived and limited, falling apart across screens and missing the complete picture. Acknowledging these shortcomings—and the growing chorus of industry voices heralding the third-party cookie’s likely demise altogether—the Internet giants are now coming forward with new “cookie replacements.” We’ve heard about Google’s AdID and variations on the same theme from Microsoft and Facebook. In addition to offering users more privacy control and advertisers richer targeting profiles, these new tracking technologies would replace third-party cookies as the foundation of attribution (path-based analysis) schemes aimed at measuring ad value.

While the new “cookie replacements” indeed promise a step forward for privacy and targeting purposes, they’ll still run up against the obstacles faced by third-party cookies when it comes to measuring ad value. Namely, they’ll still only see some of the people some of the time. For example, Google’s AdID will provide a complete path to purchase, across devices—but only for that portion of users who are logged into Google across all devices. An attempt to fill out the complete picture must then be estimated—extrapolating the behavior of this subset to the broader population. As with attribution based on third-party cookies, the result is incomplete data and estimates of ad value upon which to base ad allocation decisions. The bottom line is that when it comes to measuring ad value, the attribution paradigm of tracking consumers around the Internet just doesn’t work, regardless of the tracking technology supporting it.

Beyond not solving the measurement problem, these myriad new solutions introduce a new set of issues muddying the measurement waters. Advertisers become reliant on the seller to determine ad value. Will advertisers be confident relying on the very entity from which they are purchasing ads—which has a vested interest in the valuation—to tell them how much they are worth? (The image of a fox guarding the henhouse comes to mind.) Advertiser pressure on Google to allow third-party measurement of YouTube videos, via Nielsen tagging—to which Google recently relented—suggests advertisers will not. (The Wall Street Journal, November 11, 2013)

Furthermore, as major industry players introduce their own proprietary, unique-to-network flavor of cookie replacement, the industry moves even further away from a standard means of measuring value across publishers that provides advertisers a clear view of ad value vs. spend, regardless of where a digital ad lives. Advertisers have long relied on Nielsen for objective, standardized measurement of TV and now YouTube, while comScore fills this need for web traffic measurement. Yet digital advertising as a whole lacks a similar standard for measuring ad value. These new flavors of cookie replacements only exacerbate the issue by introducing myriad “standards” that leave advertisers looking at apples-to-oranges measurement across their ad buys. How, then, is an advertiser to understand how her Facebook advertising compares to her Google ad buy? How does she approach channels without their own cookie replacement scheme, such as Twitter or Pinterest, or whatever new channel crops up tomorrow? Without a holistic, consistent view of ad value, how can she appropriately allocate ad spend across her entire mix to maximize performance?

What the industry needs is an agnostic, third-party standard that measures ad value across both devices and publishers. Instead of focusing energy on creating patches for the fundamentally flawed attribution paradigm, let’s look to develop an industry standard using the one metric and dataset common to all advertising regardless of channel or platform: impressions. What if as an industry we shift our attention to measuring the value per impression of each of our digital ads? What if, instead of futilely attempting to chase individuals around the Internet—using the tracking technology du jour—we instead focus on measuring the value of the entire audience for each individual ad by understanding its impact on purchases and the bottom line—using always available and complete data? For ages, advertisers have used impressions as a measurement standard for broadcast, print, and outdoor ads. Applying this approach to the digital world solves the problems attribution’s multiple flavors cannot—including the multiple device, browser and user issue—while providing a complete, consistent view of ad value across devices and publishers.

When it comes to measuring ad value, new flavors of cookies and attribution are not the answer. Proprietary, channel-specific, measurement is not the answer. Only when the industry adopts an approach that provides a consistent measurement of the value per impression for each ad, regardless of channel, will advertisers finally be able to meaningfully measure the full value of that $40+ billion in ad spend and more wisely allocate that spend across individual ads, channels, and publishers.