There are lots of new ways to measure audience. However, much of the marketing world is focused on one or two metrics, primarily reach and frequency. After decades of buying audience through paid media, marketers have a very good understanding of how many dollars it takes to reach enough of the right people enough times to accomplish their business goals.
In fact, with many retailers, they have it down to a level of science where they can accurately predict how many more units of product will move off the shelf with minor changes in their weekly ad – front-page billing in the upper right-hand corner with a quarter-page minimum means a 200 percent increase in sales of canned corn.
This isn’t because they’re using a fancy algorithm. They just have decades of historical information they can use to make fairly accurate predictions. The same is true in paid media, which is the basis for measurement in earned media as well – the cost per thousand metric.
How much does it cost us to deliver 1,000 impressions to our target? This can be a very valuable thing to understand and measure, especially when you are entering the owned media space for the first time.
This is a great way to show and communicate value in a universal language that marketers understand. We have had varying degrees of success with using cost per thousand in owned media. Much of this has to do with the level of sophistication of the person to whom the metrics data is being delivered.
Those who understand the methodology behind Nielsen, Arbitron and other similar metrics know the data is projected. Meaning, the information is not “real” in the way that digital data represents actual, real things, not a guesstimate of actual, real things. In digital, reach is reach. It is not an estimate of reach.
Knowing this, it’s apparent that digital metrics are actually far more accurate than what you would get from offline methodology. For more on this, check out the methodology of Arbitron or Nielsen or the Audit Bureau of Circulation (ABC).
In comparison to how we measure digital audience, the methodology is arcane and almost laughable. Nevertheless, brands have used this data for decades to spend untold billions of dollars to reach untold projected audiences.
Establishing a comparison cost per thousand for owned, paid and earned gives us common ground. Your owned media reach should include ALL of your owned media channels.
Email. Social. Website. Microsites. Blog. Mobile. Everything.
How many impressions did you deliver? Divide that by 1,000 and multiply it by the cost per thousand (CPM) you’re paying for your offline media. This gives you a good indication of what it would have cost you to deliver the same number of impressions in paid media.
Earned media works the same way. Figure out the reach of the publications where you got a hit, add it all up, divide by 1,000 and multiply by your paid media cost per thousand. This at least gives you reach potential, which is really the same thing you are getting in your offline paid media metrics. Nielsen, Arbitron and the ABC are all saying “this is our best estimate of audience size” in paid media.
In earned media, we are using that same data to determine reach. In owned media, reach is reach. There is no real estimating. It is what it is. Being able to show its value in a language that everyone in marketing can easily understand will be an important consideration in the continued funding of your efforts.