By Todd Crawford on August 19, 2011
Advertisers are constantly in search of the right data to provide them new insights into their marketing efforts. This all important data is what allows them to optimize their return on ad spend (ROAS). The question many advertisers ask themselves is, “am I seeing the whole picture?” The old adage, “you don’t know what you don’t know” keeps a lot of marketing executives up at night.
Most advertisers rely on their analytics solutions to measure the effectiveness of their marketing channels. Typical analytics solutions use a “passive” tracking method that simply reads the referring URL data to determine the media sources. This type of tracking provides general information that is “good enough” to make general marketing decisions. It is similar to how surveys are conducted. The premise being you only need to measure a subset of the data to get a general idea of what the whole is doing. The challenge with good enough data is it never matches up with other internal or third-party data, making it difficult to rely wholly on the data from any of these sources. Discrepancies in data can be as high as 80%! When dealing with large marketing budgets, even a 10% discrepancy can be tough to stomach.
Imagine you want to know how many cars are passing by on a busy freeway. One person stands on an overpass and tries to count all of the cars as they speed under them. Another person constructs a tollbooth and requires every single vehicle to pass through it. Which one do you think will have the most accurate data on the number of cars that use the freeway? This is the difference between passive and active tracking methods.
The better and more accurate way to track advertising results is to use an “active” tracking method. This is done with click tracking URLs and cookies that act as a toll booth for all of your marketing efforts. With this methodology, you get nearly 100% accuracy which gives you a realistic picture into exactly how your advertising is performing. But tracking links and cookies are not 100% reliable either. Cookies can be blocked or deleted – compromising this tracking method. You need to use additional tracking methods to close the gap and get as close to 100% accuracy as possible. One of these methods is digital fingerprinting. Digital fingerprinting allows you to track without referring URLs or cookies by matching unique, anonymous information about the computer the customer is using at the point of the click and matching it at the point of conversion. Fingerprint tracking can result in greater tracked conversions of 2% – 8% over cookie tracking alone, giving you the most accurate picture of your marketing results.
Another consideration when managing marketing channels is the reliance on third-party pixels for tracking and reporting. Some marketing campaigns require as many as 20 pixels (analytics, paid search, affiliate, CPA, direct partners, display, email, retargeting, etc.) to be implemented. In order for media partners or channels to market you effectively, they need to have their pixels integrated into your confirmation page. Ideally, you only want to fire a specific pixel when it is required by that partner. If you hard coded every pixel so they always fired, you’d risk “over-sharing” your conversion data, crediting multiple referrers for the same conversion, and slowing down page load times.
Further complicating the integration is implementing the various types of pixels used by third-parties. Not all pixels are the same so you need to be able to integrate html, iframe, and java-script pixels. You also need to be able to populate the various values each requires and create rules for when they should fire (e.g. always fire, fire if involved in the referral, fire if last referrer).
The only real option to accurately track and measure conversions across your marketing channels is to use a source tracking and universal container tag (UCT) system. By using a UCT, you can “contain” multiple third-party pixels within a single “universal” pixel and control which third-party pixels fire and which ones don’t fire based on your conditional pixel logic. The UCT can hold all the values that you would need to pass to a third-party pixel but you decide which values to share and which to restrict.
A UCT can seem like a fairly basic technology and some companies even decide to build it in-house. Tasking your IT department with building an in-house pixel firing manager consumes valuable resources and time and often results in a conflict between what marketing needs and what IT is willing to implement. Furthermore, as the industry and technologies evolve, you will need to continually improve your in-house solution to keep up.
Third-party solutions are usually considered the best choice, since this is what they do best and they will continually improve their products to remain competitive. With a third-party UCT, your IT team only needs to integrate it once. Afterwards, the marketing team can add and remove pixels, controls firing logic, track all types of media, and get reporting across all channels without needing to involve IT again.
But a UCT should not just fire pixels based on logic rules, it should also provide you with aggregate reporting on how each channel is performing – eliminating the need to log into multiple third-party reporting systems and providing you normalized data across all of your marketing channels and partners. The outcome of all of this is more accurate data that reconciles between internal and third-party data sources.
Correctly implemented, a UCT should more than pay for itself in deduplication of conversions alone, as well as reduce or eliminate the need for added IT resources, and provide the added efficiency of quickly integrating new partners and channels. A typical retail advertiser can save as much as 20% on their performance marketing spend by deduping conversions.
If you’re interested in evaluating a source tracking and UCT product to see how much it can save you in time and money, you can try our newest product Impact Radius’ Foundation™ for free. It provides all of the capabilities discussed in this post plus a few more. For more information on Foundation™ click here.