The percentage of Internet users who click on display ads has dropped from 32 percent to 16 percent in just two years, with only 8 percent of people on the Web now accounting for 85 percent of all clicks, according to a the latest "Natural Born Clickers" study by Comscore, Starcom USA and Tacoda.
But the steep decline -- which even the authors of the study called surprising -- does not suggest that display ads are a poor investment, the study said. It simply shows that click-though rates are an increasingly poor metric for determining their effectiveness, despite being widely used to do just that.
"We've been beating this drum for years now on the over-reliance on the click as a measurement of ROI," Andrew Lipsman, director of marketing communications for Comscore, said. "If you're evaluating your ROI on clicks alone, you could really be throwing off your calculations."
Comscore client surveys have shown display ads produce measurable lift in brand site visitation, trademark search, and both on- and offline sales, regardless of whether users clicked on the display ads themselves, the study said. Hence advertisers are better off using view-through metrics to determine the value of a display ad campaign.
"The fact of the matter is that branded ad exposures have a very real and quantifiable impact," Lipsman said. "But the whole digital industry has really grown up with the click and as a result looks at that at the measure of effectiveness."
The original "Natural Born Clickers" study, conducted in 2007, showed that 32 percent of Internet users clicked on at least one display ad during the month. The decline of 50 percent in just two years suggested that there was more at work than the usual rate of display-ad fatigue, Lipsman said, citing the economy as a possible factor.
"There may be less intent [to purchase] from the average Internet user," he said.
Nonetheless, the long-term trend clearly shows that as users become more sophisticated, they are less likely to click banner ads.
"In the earlier days of the Internet, click rates were maybe 2 to 5 percent, and now we're talking about small fraction of a percent of overall clicks," Lipsman said.
The study divided Internet users into four categories based on click frequency: heavy clickers, moderate clickers, light clickers and non-clickers. From 2007 to 2009, heavy clickers went from 6 percent of all Internet users to 4 percent; moderate from 10 percent to 4 percent; and light from 16 to 8 percent. Meanwhile, non-clickers as a percentage of the entire Internet population rose from 68 to 84 percent.
Also in that time, heavy clickers went from representing 50 percent of all clicks to 67 percent, while moderate and light clickers came to represent fewer overall clicks, reinforcing the finding that a smaller group of people are accounting for a shrinking number of clicks.
"A click means nothing, earns no revenue and creates no brand equity," John Lowell, Starcom USA SVP and director of research and analytics, said in a written statement. "Your online advertising has some goal -- and it's certainly not to generate clicks."
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Douglas Quenqua is a journalist based in Brooklyn, NY who writes about culture and technology. His work has appeared in The New York Times, Wired, The New York Observer, and Fortune.
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