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ROI can seem like a mythical creature for digital advertisers—something everyone wants to capture but remains stubbornly elusive. Despite the explosive growth of digital advertising technology, proving and measuring ROI continues to be a challenge.

To start, many platforms that track and measure ROI are not standardized, resulting in metrics that are inconsistent. In addition, the conventional currency used to measure success tends to be based on quantity rather than quality, leading to an onslaught of content created purely to drive traffic. In this way, inefficient measurement capabilities lead to irrelevant content, which is why we’re now faced with an abundance of broad and untargeted efforts that bombard consumers with off-mark messaging.

Accurate measurement is a critically important part of delivering the most impactful content to consumers. That said, let’s dive into why digital advertisers need to pay more attention to measurement in today’s highly competitive marketplace.

Personalized messaging

It’s a no-brainer that customers want ads that are relevant to their lives, otherwise they are just noise—distracting at best and alienating at worst. This principle has never been stronger than it is today with the ubiquity of mobile devices. Smartphones have become an intimate part of our lives, carried with us into bedrooms, workplaces, and doctors offices, and used to navigate the countless details of our days.

In this context, seeing an irrelevant, impersonal ad can feel invasive, and given the wealth of data advertisers have about consumers, it comes across as unprofessional. This is why personalization is a core component of mobile marketing success, especially among millennials. USC reports that 85% of millennials are more likely to make a purchase if it is personalized to their interests, both in-store and with digital displays. And according to another recent report from SSI and ICLP, it’s not just millennials: Baby Boomers also want personalized customer experiences that are responsive and communicative. To deliver personalized content, digital advertisers need accurate measurement. They need to know if their ads are reaching the right people with the right message at the right time.

Ad fraud

Ad fraud is a huge problem facing businesses today, and one that is growing. Data shows that ad fraud – stemming from non-human traffic, pirated content, and malicious “malvertising” – is costing the U.S. marketing and media industry an estimated $8.2 billion each year. That is $8.2 billion poured down the drain, and signs show that fraud is accelerating. In a report from ad-focused computer security firm White Ops, one “Russian cyberforgery ring” called Methbot has created more than 500,000 fake internet users and 250,000 fake websites, tricking advertisers into paying $3 to $5 million in fraudulent revenue a day for premium video ads that are never watched.

No business wants its hard-earned capital wasted. Having access to a wealth of data allows brands to differentiate between real views and bot views. Having reliable, accurate measurement tools is also a key element in the fight against fraud. By accurately measuring ROI, ad fraud is diminished.

Investors want to know the value of their spend

Before anyone puts money into digital advertising, they want to know the value of the money they spend. Investors won’t gravitate towards solutions that do not deliver on market needs and clients won’t utilize products that fail to earn measurable improvements in their advertising performance.

Demonstrating value requires hard data, and metrics like “viewability” are abstract and easily manipulated. Take the ad-tech challenges faced by media newsrooms today. Aram Zucker-Scharff, a developer who works at Salon, has spoken out about ”just how impossible it is for publishers to use ad networks & avoid serving malicious ads.” Experiences like this make adtech’s viability and value seem exceedingly murky to investors and buyers alike. For the industry to grow and thrive, its stakeholders need to collaborate in support of cultivating standardized, high-quality data. They also need to be more straightforward about the impact of fraud in the space and how they intend to combat it.

How To Measure Effectively

To measure effectively, advertisers need to answer four critical questions: What is working? How is it working? Why is it working? Who is it reaching?

There are many different stages involved in an ad campaign and Placecast has developed a set of measurement solutions that work to answer the questions above, at each stage such as:

  • Planning:  Where do I find my particular audience in the real world?
  • Targeting: How do I target an ad to a specific audience segment?
  • Verification: Did I actually reach the audience I targeted with my mobile campaign?
  • Delivery: What Impact did my campaign have on perceptions of my brand?
  • Insights: Did consumers exposed to the ad visit my store locations?

We will explore these solutions more deeply in subsequent blog posts, but the solution ultimately lies with location data intelligence.

These solutions create more accurate measurement, which enables more targeted, personalized campaigns, which ultimately lead to a more positive brand experience for consumers. Furthermore, the more accurate the measurement, the less money is lost to ad fraud. And the more accurate the measurement, the more appealing digital ads are to brands and investors alike. People want to see ROI and they are more likely to allocate money to digital advertising if they see a clear value. Accurate measurement remains a challenge, but it’s one that can’t be ignored. In 2017, optimizing measurement and proving ROI needs to be at the top of the adtech agenda.

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