Killing the click: Part 1

In 1993, Global Network Navigator became the first commercial website to sell a clickable ad. It was not until 1994 that the notion of selling an ad space in large quantities, to compensate writers and to cover costs, was truly realised. At this point, the term ‘banner advertising’ was born. In its infancy, banner advertising was limited in its measurements, relying on one central metric, the click. The click and the click-through rate (CTR) became the go-to metric to understand whether the ad space you had purchased was functioning or returning advertising investment dollars.

Advertisers were hesitant about budgeting money to the web and they needed to show their management that they were not throwing money down a black hole if they did so bet on the web. The click was their justification and saviour to explain that the campaign worked because “people clicked on our ads, which means they saw it.”

In 1996, after ad sizes were standardised and online advertising had invaded most major commercial websites, the average CTR began to drop. Commercial websites struggled to recoup revenue and began to create ad technology that users could not ignore: the pop up, pop under, etc. These ads were hard to ignore (or avoid) and briefly brought back the CTR rates of yesteryears. 

This struggle and cyclical process would go on for years. Whether the intentions were good or bad, the click became the metric that was pursued, inflated, manipulated, and created. It is and was the most simple and cheapest way to measure loosely defined campaign effectiveness. The number of potential metrics has exploded since the first online advertisement, but the CTR, despite academic research that shows that there is little relationship between clicks and advertising effectiveness, is still alive. Fortunately, its role as a proxy for evaluation of everything is gone. Why?

To truly understand why the click is the wrong measurement for evaluating your branding campaigns, we need to dissect what a click is. A click can fall into three different categories, two of which we’ll focus on here.

Fraudulent Clicks

In economics, it's safe to say that supply follows demand. As the market shifts and demands increase, supply will increase to fill the gaps. The same can be said for online advertising and clicks. As the market demanded more clicks and began to set benchmarks of success based on clicks, click fraud was born. The dark side of the web stepped up to fill that void and, to this day, benefit from this demand monetarily. 

Whole industries and businesses have been built on this premise. These self-proclaimed professionals either subcontract the job to armies of clickers in India or China in what we now know as “click farms”, or they automate the process entirely.

As mentioned earlier, if we continue to chase the click, there will be entities there ready to provide the clicks we desire. It was estimated that digital ad spends in 2015 reached US$56 billion in the US. Of which, US$21.8 billion was fraudulent. This means that for every US$3 dollars spent on ads, US$1 dollar goes into the pocket of the bad guy.

Due to the lack of maturity in certain markets, the rate of fraud in SEA, India, and China are speculated to be significantly higher. Bots visit premium websites to drive up impressions but do not click. The fraudulent sites drive their clicks via bots and click farms, which encourages optimisers to push campaigns to their high CTR sites. How bad has it gotten? 

Fraud technology has improved so much that bots, when sent to websites, can load pages to drive ad loads, generating impressions, which then get sold to ad exchanges and networks. Some of these bots are so advanced they can imitate human activity, which makes them extremely difficult to find and stop. It is estimated that over 40 percent of bots can imitate human behaviour. Due to this, it is very difficult to pin down the exact percentage of click fraud within a CTR, but it is safe to assume that the CTR rates that we see referenced are a convoluted mixture of numerous negative influences. 

As an industry leader, Xaxis is taking big steps to mitigate click fraud. First off, our team is continually analysing and scanning for anomalies in the supply pools we access. When we identify something that looks out of the norm, we immediately place the publisher on a blacklist. Secondly, we secure private and direct premium supply deals with as many partners as we can in APAC to ensure that we have first access to the highest quality inventory in the region. Fraud is a fast-moving target and we strive to do what we can to minimize the impact it has on your campaign.

Accidental Clicks

In addition to click fraud, another negative influence on CTR is the accidental click.  It has happened even to the best of us, whether it arose from the urgency of searching for a piece of information or the lack of patience with a rich media advertisement, we have all inadvertently clicked on an ad without knowing what it is. We’ve also clicked on an ad hoping it would just go away. Accidental clicks come from three main areas: momentum-based scrolling, creative problems, and 'the opposite’. 

• Momentum-based scrolling This is where the user accidentally clicks on an ad while interacting with the content on a mobile or desktop site. 
• Creative problems Ad formats that make it impossible to click the ‘x’ button to exit the ad, forcing the user to land on the advertiser's page. Alternatively, ads can be misplaced on a site preventing users from exiting an ad.
• ‘The Opposite’ Wherein the creative resembles part of the content, which leads to an accidental click on the ad, disrupting the mobile or desktop browsing process.

It is easy to think that with proper ad design we can avoid the above scenarios and these accidental clicks, but many publishers have designed their sites on desktop and mobile to promote and even encourage accidental clicks. It is estimated that users are three times more likely to accidentally click on a static banner than rich media, because static banners appear to be part of the content and may be clicked on unintentionally.

Accidental clicks account for nearly 38 percent of all clicks on static banners and 13 percent of all rich media clicks. If we account for these accidental clicks, it is estimated that static banner CTR’s could be reduced by 45 percent and rich media ads by 23 percent.

What can be done to avoid accidental clicks? This is a tough question and the answer typically lies in the supply that we consume. At Xaxis, with our direct inventory deals and proprietary media, we access a list of publishers that follow IAB standards and use top of the line user experience design.  Accidental clicks are more a function of the design rather than the user, so with the right partnerships we can help reduce the ‘fat thumbs’ and inadvertent clicks.  

Two categories of clicks have been unpacked here, for insight on the third, and more info on misleading campaign metrics, read the second instalment on killing the click (which will be published next week).