By Daniel Fisher
Managing Director of Europe, Playbuzz
Despite an excess of advertising formats in the market, most top-of-funnel formats are still measured by impressions or views (CPM - cost per thousand, CPV - cost per view, CPCV - cost per completed view).
Whilst those metrics tell advertisers how effective their spend was in obtaining reach, they also require some bold assumptions when attributing that spend to consumer action.
Cost per engagement (CPE) campaigns bridge a gap that other buying models are lacking, reflecting the depth of each consumer’s interest in the advertising they’re seeing.
No more guessing games
What if there was a way to reduce the guesswork in conversion? Meaning, when an advertiser pays once, a consumer has seen the content AND interacted with it, e.g. clicked, shared, or scrolled for a meaningful amount of time, ensuring there is a much closer nexus between that consumer and an action with the brand. The consumer has both seen the content and chosen to take action on it.
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Cost per engagement (CPE) campaigns bridge a gap that other buying models are lacking, reflecting the depth of each consumer’s interest in the advertising they’re seeing. Here are three reasons why Netflix, Unilever, eBay, Sky and more are buying CPE campaigns.
The higher the correlation between engagements and your campaign impressions, the more you know your budget was not wasted.
1. CPE reduces media wastage
The higher the correlation between engagements and your campaign impressions, the more you know your budget was not wasted. The aim becomes less about impression volumes and more about ensuring that your impressions convert into action.
With viewability becoming more and more important for a number of agencies and buyers (see GroupM’s requirements), a sure fire way to guarantee good performance is to focus on a level down in the funnel - what a user does after they see an ad.
2. CPE is recognised by third parties
Nielsen, arguably one of the most trusted measurement companies for leading media agencies and brands, measures campaign engagement as an indicator of success.
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In fact, the company frequently references consumer engagement in their materials, and as far back as 2010, were expounding the power of engaged audiences when it comes to advertising impact.
Engagement shines a light on poor content and/or experience, allowing publishers to test A-B creatives and find alternatives
3. CPE holds media owners accountable
When sellers are focused on delivering engagements rather than impressions, they are on the hook to ensure the campaign performs at its best at all times.
Interactive campaigns that include storytelling elements such as polls, quizzes, flip cards and ranked lists - like this one by Netflix or this one by Brita - can be optimised while they are running. This enables the agency or brand to critically assess consumers behaviour in real-time and determine if one element of the campaign is not performing well.
Engagement shines a light on poor content and/or experience, allowing publishers to test A-B creatives and find alternatives. Remember - engagement leaves nowhere to hide.
With more and more tech platforms moving to CPE, it is important for buyers to understand up front what the value of the CPE they are buying is in real terms.
How to measure engagement
A common definition of ‘engagement’ in advertising is, however, still elusive. It seems that common ‘go tos’ are measuring dwell time, shares, CTRs and comments.
All of these work, however, in addition, I suggest layering in scroll depth, in-campaign engagements such as interactions with interactive elements, and then wrapping those engagements with third party studies (with providers like Nielsen) to back-up the user actions.
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With more and more tech platforms moving to CPE, it is important for buyers to understand up front what the value of the CPE they are buying is in real terms. As well as how it backs into more traditional models such as CPM and CPV.
It is crucial that buyers define KPIs in advance.
Define KPIs in advance
CPE is a newer model, and not all engagements are created equal.
In fact, the industry standard of engagement ranges from 3 seconds (Facebook’s video product), all the way to 15 seconds, and can also be defined as an active interaction within a branded content campaign.
It is therefore crucial that buyers define KPIs in advance and work with third-parties to determine what successful engagement means for any given campaign.