Why Metrics Don't Matter...Yet

Interactive advertising and marketing executives, like their offline counterparts, are fiercely competitive and highly guarded creatures. The same traits that help these business executives and creative personalities to soar can also impede an industry movement to bring consistency, including standards, to measuring digital media’s impact and reach.

Just about everyone agrees online advertising should be easier to track and measure than offline advertising. After all, something built on bits and bytes lends itself to analysis and promises opportunities to target ads to the right person at the right time. Why else would Microsoft pay $6 billion to buy aQuantive, an Internet advertising agency, or Google propose to acquire DoubleClick, aQuantive’s competitor, for $3 billion?

Observe advertising and marketing executives in action during Advertising Week in New York City, and you’ll begin to understand the challenges.

A sampling of some panel discussions at the Interactive Advertising Bureau’s MIXX conference featured, for the most part, presentations heavy on inspiration and light on lessons learned or instructive how-tos. That stands in contrast to, say, information technology executives who take pride in telling their war stories at conferences and explaining how they’ve overcome problems.

That raises a question: if marketing and advertising executives don’t trust each other to openly discuss their failures as well as their triumphs, can they ever agree on approaches to measure online activities and the impact and reach of advertising?

Another sign of digital media dysfunction: the existence of two separate Advertising Week conferences devoted to interactive marketing and advertising. MIXX competed on the same days and in the same city with OMMA, operating outside official Advertising Week parameters.

Interestingly enough, a down-and-dirty look at digital media’s challenges played out Wednesday at another Advertising Week venue: the William S. Paley Center for Media, named after CBS television’s founder. Perhaps it was the venue, maybe the speakers. But this panel showed some edge.

It included Mark Kingdon, Organic chief executive; Beth-Ann Eason, Martha Stewart Living SVP; and Jon Mandel, chief executive of NielsenConnect, a service designed to integrate and analyze Nielsen’s consumer purchase information, store data, online measurement, modeling assets, and other intelligence. These executives identified hurdles that must be overcome if interactive advertising and marketing are to live up to their promise:

Extreme competition among advertisers, marketers, and others makes it difficult to bring together stakeholders to advance an agenda. “If you’re a surgeon in San Diego, you’re not going to lose business to a surgeon in New York. In all my years in New York, everyone has had their own agenda,” Mandel said.

While there’s plenty of data about online activities, it’s not sufficient. “There’s not enough talent to turn the data into insights that are actionable,” warned Eason. Kingdon concurred: “It takes systems thinkers, not technologists. It takes people who can diagram the ecosystems, understand the connection points in how the data and things flow. That’s a different analytic discipline.”

Advertisers resist paying to use emerging platforms, such as video on demand, because the programs aren’t measured, said Eason. Thus, the industry must be quicker to find ways to measure these platforms to ensure advertising dollars are placed in the most effective medium — whether it’s video, widgets, blogs, display ads, or elsewhere.

Online advertising still dwarfs television advertising, a situation that tends to give executives working on TV accounts more clout than those working on interactive. “The largest budget has all the power,” Mandel said. That obstacle, he said, was recognized at Carat where David Verklin, Carat Americas’ chief executive, merged the media’s agency traditional practice with its digital marketing organization and named Sarah Fay, who came from interactive, to run the shop.

Advertisers and marketers give short shrift to measurement services without fully understanding what they are about or without offering suggestions on what changes they’d like to see, said Mandel. Showing off the sales side, he pitched Nielsen’s audience measurement and research services. “If I had known the handful of stuff available from Nielsen, I would not have made up half the sh-t I did at the agency,” cracked Mandel, a former executive at MediaCom and Grey Advertising.

How can interactive media live up to its promise and move beyond the egos, politics, and sea change to reach some common ground?

Mandel offered up this solution: “It takes a couple of people to take the lead. To say, ‘Damn it, we’re going to do it.’ It takes other people in the world to be big enough to say, ‘I’m going to defer to them.’ To put the agendas aside.”

Mandel said that worked in the late ’90s at MediaCom, an online buying service, when he and his colleagues were asked to come up with a metric to measure online advertising campaigns. After his seventh vodka at Smith & Wollensky restaurant, the click-through measurement was born, though he stressed it was intended to be a short-lived metric.

“We need another vodka lunch,” quipped Kingdon.

Now, that’s something the industry can agree on.

Join us for ClickZ Specifics: E-Mail Marketing on October 2, in New York City.