Posted by Sarah Rios On May 17
The following post is a special contribution from Jay McQuillian, Director of Chitika’s Data Solutions Engineering Department:
As the head of the Data Solutions Engineering department here at Chitika, I work with my team every day to find interesting trends and stories about the world of online advertising by analyzing data found in our extensive ad network. Chitika Insights, the research arm of Chitika, produces a series of reports each week covering trends on the Internet and also creates special reports and tools for advertisers and marketers to plan and optimize their campaigns for the best possible ROI.
One of the most exciting and pertinent tools we have produced is the Chitika Ad Monetization Matrix or CAMM. The Boston Consulting Group Matrix and the Gartner Magic Quadrant have long been fundamental tools in conducting business analysis for a wide variety of industries. These tools are invaluable in helping businesses direct resources toward the segments with the highest worth or potential to optimize their revenue stream.
In an effort to contribute a similar tool to the world of online advertising, my team here at Chitika Insights created the CAMM, which measures the three key aspects of online advertising markets: volume, click-through-rate (CTR), and the value per click to an advertiser (CPC). In our quadrant, each category (like Health Care, Real Estate or Transportation) is represented in a circle that is proportional in size to its market share or volume. On the horizontal axis, we plotted the CTR, which directly corresponds to the likelihood of an ad being clicked by a user. Finally, on the vertical axis, we plotted CPC, which refers to how much an advertiser is willing to pay a publisher when an ad is clicked.
The quadrant can be broken down into four distinct market segments, as seen below:
Some interesting insights:
- Insurance can be found within the Special Interest segment, as it captures the highest CPC across all quadrants, but has a relatively low CTR
- Banks reside in the Click Kings segment, with exceptional performance in both CTR and CPC
- Transportation captures the highest CTR but with the second-lowest CPC, it ends up categorized in the Economic Essentials segment
- Media has the lowest CTR and CPC across all units, and takes its place in the Obscure & Unpopular segment
Why is this matrix important? By understanding the implications of each of these market segments and incorporating them into dynamic campaigns and SEO strategies, advertisers can effectively increase the potential for site monetization. One of the biggest aspects of control for publishers and advertisers is the volume of their particular markets. Using a tool like this can help you discover where your ads have too much or too little volume, and adjust the volume within categories by looking at revenue produced. Ads with high CPC but low CTR (Special Interest) are really meant for a narrow audience – meaning, that to maximize their monetization, they should only be shown in cases in which the audiences intent is clear (e.g., showing ads for baseball gear on an sports blog). Alternatively, ads with a higher CTR are generally applicable to a wider audience, and therefore do not require such targeted scenarios to be profitable.
Interested in more reports like this from Chitika Insights? Head over to our blog for the latest studies covering trends on the Internet as seen on our network. You can always reach us by emailing press@chitika.com with any questions you may have!
Posted by Karla On Jan 14
Bill receives all kinds of support questions on a daily basis here at Chitika. Today he was gracious enough to share 3 important questions that ALL types of Chitika users could benefit from.
What’s the difference between an “impression” and a “page view”?
“You may see these two terms used often and different contexts. While they have similar meanings, it’s the context that makes the difference. Page views are a measure of website traffic. In this context, the term page view represents every time a page from your site is requested by a visitor. If you have three visitors that each request five pages, this will result in fifteen page views for your site.
Impressions are a measurement of the number of ads that are shown on your site. An impression occurs any time an ad unit is displayed. If you have two Chitika ad units on your page and five users request the page, the result will be ten ad impressions since the five users each saw two ad units.”
Are “unique IP addresses” the same as “unique visitors”?
“An IP address is a basically just a numeric pointer for computers and servers on the internet to be able to find each other. For example, if you type “www.Chitika.com” into your web browser, your computer and our servers know how to talk to each other based on this numerical IP address. Therefore, when you look at the number of unique IP addresses accessing your web site, what that loosely means is the number of different machines requesting information from your site.
The area where these two terms are blurred is when either a user accesses your site from multiple machines on separate IP address – for example, at work and at home. In this case, the number of users and IP addresses are both two, but there is actually only one unique visitor. On the other hand, a home or business could have a network that uses only one IP address on the internet. In this case, if two people from inside the network access your site, the unique IP address count would only be one, but the unique visitor count should be two. Generally, web statistics are reported in unique visitors, though this number is a highly-refined estimate.”
My Chitika reports give me a breakdown of impressions, clicks, CTR, Avg CPC and eCPM for my account. What is all this stuff?
“As explained previously, an impression is counted anytime an ad is displayed to your visitor. This may happen multiple times per page view if there are multiple ad units on a page. A click is a fairly easy unit of measurement – a click occurs when your user clicks on your ad. CTR or click-through-rate is the percentage of your impressions that garner clicks. For example, if your site has 1,000 impressions in a day and results in 10 clicks, you would have a 1% CTR.
Average CPC or cost-per-click is the average amount that you are paid per click generated from the ad units on your site. This number is represented as an average of the CPCs that you get on each click for each day. Specific CPC values can fluctuate depending on the market and having the average of these values helps to illustrate the overall trends of the CPCs generated for your ads.
eCPM or effective cost-per-thousand impressions (the M is for the roman numeral M meaning 1,000) is a unit designed to help normalize the performance of a CPC ad unit. On a simple level, this number represents the amount revenue you would generate for 1,000 impressions based on your current CTR and CPC. As an example, if you had 1,000 impressions at a 2% CTR you would generate 20 clicks. If your average CPC was $0.20 for those clicks, you’d earn $4 on those 1,000 impressions – a $4.00 eCPM.”
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