1. 1
DRIVING OFF-LINE RESPONSE WITH
ONLINE ADVERTISING
Richard Becker
President – Target Analytics
Monday, September 30th, 10am – 11:15am
2. 2
AGENDA
The Next Generation of On-Line Advertising
Use Case # 1 – University of Indiana
Use Case # 2 – XXX
Use Case # 3 – XXX
Wrap Up
3. 3
AGENDA
There is practically no chance communications space satellites will be used to provide better telephone,
telegraph, television or radio service inside the United States."--T.A.M. Craven, Federal Communications
Commission commissioner (1961)
Needless to say, Mr. Craven is no longer the commissioner of the FCC.
* "I think there is a world market for maybe five computers."--Thomas Watson, chairman of IBM, 1943
Of course, Watson was referring to room-size mega-machines filled with vacuum tubes. But still.
* "The Americans have need of the telephone, but we do not. We have plenty of messenger boys."--Sir William
Preece, chief engineer, British Post Office, 1876
How're the messenger boys working out for you, England?
* "This 'telephone' has too many shortcomings to be seriously considered as a means of communication."--
Western Union internal memo, 1876.
Oops! Western Union sent its last telegram in 2006.
* "Television won't be able to hold on to any market it captures after the first six months. People will soon get
tired of staring at a plywood box every night."--Darryl Zanuck, 20th Century Fox, 1946
He was right. We've moved on to aluminum and plastic.
4. 4
WHY IS DISPLAY ADVERTISING IMPORTANT?
Improve the
response and
conversion
Reinforcing the
brand to build
awareness,
favorability, and
consideration is
often overlooked
The Role of Display Advertising
5. 5
TRADITIONAL MODELS OF ON-LINE ADVERTISING
Topic and Interest Targeting
Target users from predefined interest categories, inferred from a user browsing history
Keyword Contextual Targeting
Use keywords to find web pages for your ads across your ad network
Remarketing / Retargeting
Target ads to people who have previously visited your website as they browse other web sites
Self Reported Data Targeting
Target ads based on information volunteered by the user via a membership form or user profile
Location Based Targeting
Target ads based on a user’s geographic location
Demographic Targeting
Target ads based on a user’s estimated age, income, gender, etc.
6. 6
LIMITATIONS OF TRADITIONAL ON-LINE AD MODELS
Key Limitations
Advertising based on inferences of affinity,
interest, and capacity, not previous philanthropic
behavior or organizational affinity
Advertising is delivered to unknown recipients,
limiting the ability to measure its effectiveness on
stimulating other on-line and off-line channels
Advertising is centered on the on-line actions of
web users, such as previously visiting your
website, a very limited perspective that does not
account for previous philanthropic related
behavior or affinity
7. 7
CONNECTION360: ONE-TO-ONE ON-LINE ADVERTISING
One-to-One Marketing via On-line Display Advertising
• Leveraging the industry’s premier on-line
audience and targeting network, Target Analytics
is able to provide on-line display advertising to
your target prospect list, enabling true 1:1
marketing.
• Wherever your audience is on-line, Target
Analytics is able to identify them and provide
display advertising to them, synchronizing the
delivery of your advertising with all other 1:1 on-
line and off-line marketing channels.
• Better yet, Target Analytics is able to measure
and report on both the on-line and off-line impact
of the impressions served to your audience, via
the industry’s only “closed loop analysis”
9. 9
CAMPAIGN OVERVIEW
Client
• University of Indiana
Campaign Objective
• Cross channel campaign to complement direct mail, targeting alumni
• Goal was a minimum of a 3% lift in donors during 6 month program. At an average gift of $118, minimum
expected return of $53,602 on a digital campaign cost of $45,000 (Return on Ad Spend of 1.16 : 1)
Campaign Scope
# of Household Records – Mail File 453,488
Campaign Duration 6 Months
Campaign Timing September 18, 2012 – February 15, 2013
Digital Campaign Spend $45,000
Cost per Thousand Impressions $9.00
10. 10
ADS SERVED
300 x 250 02
728 X 90 01
728 X 90 02
120 X 600 01 120 X 600 02160 X 600 02160 X 600 01
180 X 150
120 X 240
11. 11
IMPRESSION FREQUENCY
Daily impressions were served at a relatively consistent rate per household
over the campaign duration, serving a daily average of ~2 imps/HH/day
12. 12
BRAND EXPOSURE
Total Mail File - # of Households 453,488
Total # of Households with Cookies 340,294
% of Mail File with Cookies 75.0%
Total # of Households Served Ads During Campaign 161,898
% of Mail File Served Ads 35.7%
% of Mail File with Cookies Served Ads 47.6%
# of Ads Served 4,992,663
Average Number of Ad Impressions Per Household 30.8
Average Number of Ad Impressions Per Household Per Month 6.3
161,898 Households were delivered 4,992,63 Ad Impressions Over 6 Months
13. 13
CAMPAIGN PERFORMANCE
Control
Cookies No Ad Served
Test
Cookie Ad Served
Lift
Unique Households 161,898 161,898 -
Total Gifts 10,075 11,778 1,713 or 17%
Total Revenue $1,343,681 $1,564,017 $220,337 or 16.4%
Total Donors 6,253 6,870 617 or 9.9%
$ Per Household $8.29 $9.66 $1.37
Average Gift Per Donor $214.89 $227.65 5.9%
Average Gift $133.36 $132.68 (0.51%)
Connection360 generated an incremental
617 donors representing an incremental $220,337 in gifts
14. 14
CAMPAIGN PERFORMANCE
Ad Spend
Incremental Gifts
ROAS/Incremental
Gifts
Control Group:
No Digital Ads
Test Group:
Digital Ads Served
Control Group:
No Digital Ads
Test Group:
Digital Ads Served
Gifts
Display Adverting produced
17% increase in gifts.
Display Advertising has an extremely
positive impact
5:1 ROAS
Total Revenue
Generated
$44,934
10,075
11,778
17%
$220,337
$1,343,681
$1,564,017 Display Advertising provided
incremental lift in revenue in excess
of $220K representing 16.4% lift
Test Group:
Digital Ads Served
16.4%
15. 15
CHANNEL ANALYSIS
Test Control Lift
Web $ 99,150 $ 56,360 $ 42,790
Mail $1,464,867 $1,287,320 $177,547
Total $1,564,017 $1,343,681 $220,337
Campaign Cost $44,934
Return On Advertising Spend 4.9:1
16. 16
LIFETIME VALUE ANALYSIS
Lifetime Value 12:1
LTV Assumptions:
Year 2 Donor Retention at 61.5% and Revenue Retention at 82.1%
Year 3 Donor Retention at 65.1% and Revenue Retention at 83.8%
Control Test Lift
Conversions Gifts $/K Conversions Gifts $/K Conversions Gifts S/K
Year 1 6,253 $1,344 6,870 $1,564 617 $220
Year 2 3,846 $1,103 4225 $1,284 379 $176
Year 3 2504 $924 2750 $1,075 246 $147
$3,371 $3,923 $552
17. 17
TEST VS. CONTROL: AGE
1%
4%
8%
9%
11%
12%
14% 14%
12%
10%
6%
1%
4%
9%
10%
12%
13%
14% 14%
11%
9%
4%
18-25 26-30 31-35 36-40 41-45 46-50 51-55 56-60 61-65 66-75 Over 75
Age
IU Control IU Test
• Test and Control follow very similar age distribution
• The head of household for each group is more likely to be of middle age, in the
range of 45-60 years old
18. 18
TEST VS. CONTROL: RESULTS BY AGE
Age Group Control Test Lift
20-29 1.8% 2.49% 138.3
30-39 1.91% 2.27% 118.8
40-49 2.81% 3.40% 121.1
50-59 4.52% 5.45% 120.8
60-69 6.26% 6.39% 102.8
70-100 7.83% 8.27% 105.6
n/a 8.99% 11.07% 123.2
Total 4.10% 4.48% 109.2
19. 19
TEST VS. CONTROL: INCOME
1%
2% 3%
4%
6%
10%
18%
16%
10%
12%
9%
7%
3%
1%
2% 2%
4%
5%
9%
17%
16%
10%
13%
10%
8%
4%
< $15K $15K -
$29K
$30K -
$39K
$40K -
$49K
$50K -
$59K
$60K -
$74K
$75K -
$99K
$100K -
$124K
$125K -
$149K
$150K -
$199K
$200K -
$249K
$250K -
$499K
> $500K
Income
IU Control IU Test
• Test and Control follow very similar income distribution
• Majority of these households have income above $100K
20. 20
TEST VS. CONTROL: GENDER
Gender
Control
% Pop.
Test
% Pop.
Control
Index
Test
Index
Lift
Female 60.1% 59.7% 4.10% 4.31% 105.16
Male 39.9% 40.3% 4.10% 4.73% 115.29
Total 100.0% 100.0% 4.10% 4.48% 109.25
21. 21
DISTRIBUTION BY DONOR GROUP
No Donations
Previous 3 Years
Donations 1X or 2X
Previous 3 Years
Donations Each Year
Previous 3 Years
22. 22
PERFORMANCE IMPROVEMENT BY DONOR STATUS
No Donations
Previous 3 Years
Donations 1X or 2X
Previous 3 Years
Donations Each Year
Previous 3 Years
23. 23
REACTIVATION IMPROVEMENT
# Years Lapsed Control Test Lift
0 Years 22.8% 23.9% 107.4
1 Year 6.67% 7.45% 110.1
2 Year 2.70% 3.99% 147.4
3 Year 2.48% 2.88% 115.8
4 Year 1.69% 1.91% 112.8
5 Year 1.07% 1.56% 145.9
6+ Years 0.66% 0.72% 110.0
Total 4.10% 4.48% 109.2
24. 24
ANNUAL GIFT LIKELIHOOD MODEL
80% of gifts in top 20% of Annual Gift Likelihood (AGL) Score Range
56% of gifts in the top 10% of Annual Gift Likelihood (AGL) Score Range
Distribution of AGL scores were similar, Test/Control
26. 26
CONCLUSION & RECOMMENDATIONS
• Consistently reinforcing the University of Indiana brand on-line improves awareness, favorability,
and consideration, leading to higher direct response conversion rates
• The measure of success for this campaign was significantly exceeded
• Recommendation
• Run brand reinforcement campaign on-line year round, receiving bi-annual closed loop report to verify fundraising impact
• Broaden file to include more than alumni
Results Test Control Lift (Actual) Lift (%)
Alumni Household
Conversions
6,870 6,253 617 9.87%
Dollars Raised
During Campaign
$1,564,017 $1,343,681 $220,337 16.4%
Measure Campaign Goal Campaign Result
Return on Ad Spend 1.16 to 1 4.9 to 1
Incremental Revenue $53,602 $175,337
28. 28
CAMPAIGN OVERVIEW
Client
• Environmental Defense Fund
Campaign Objective
• Complement direct mail campaign with on-line advertising for 3 month campaign cycle.
• Two audiences provided:
• 735,832 Prospects
• 144,857 Lapsed Donors
• Evaluate the impact of Display Advertising on campaign response rate and donations.
• Evaluate return on advertising spend (ROAS)
Campaign Scope
# of Household Records – Mail File 880,689
Campaign Duration 3 Months
Campaign Timing September 18, 2012 – December 31, 2012
Digital Campaign Spend $41,842
Cost per Thousand Impressions $9.00
33. 33
CAMPAIGN METRICS – FILE ANALYSIS
Initial Mail File 880,689
Total # of Targetable Households with Connection 360 Profile 879,537
Total # of Targetable Households with Cookies 567,923
% of Targetable Households with Cookies 64.57%
Total # of Households Served Ads During Campaign 250,452
% of Mail File Served Ads 28.48%
% of Mail File with Cookies Served Ads 44.09%
# of Ads Served 5,997,429
Average Number of Ad Impressions Per Household 23.9
Average Number of Ad Impressions Per Household Per Month 7
Brand Exposure:
250,452 Households were served 5,997,429 Ad Impressions over 3 Months
34. 34
CONNECTION360 RESULT SUMMARY
Total Households Reached with On-Line Advertising 250,452
Total Ad Impressions Served to Households 5,977,429
Average Number of Ad Impressions Per Household 23.9
Average Number of Ad Impressions Per Household Per Month 7
Brand Exposure
Return on Ad Spend
Connection 360 yield an additional 323 conversions resulting in an incremental
$39,283 in Gifts
.94:1 Return on Advertising Spend
Revenue Donors
Incremental Lift Associated - Direct Mail $23,170 74
Incremental Lift Associated – Web $14,278 214
Incremental Lift Associated -Other $1,835 35
Total Associated with Ad Spend $39,283 323
Total Cost of Campaign $41,482
35. 35
FORENSIC CONTROLS EXPLAINED
Run the
Campaign
Define the
Control Group
Measure
Performance
Post Exposure Pre-Result
The “Control Population” was created from the population of 317,471 households that
were:
Matched to a cookie, and
Received direct mail, and
Did not receive ad impressions
The Forensic Analysis worked as follows:
We used the total population of households served ads as the “Test Group,” this group
is the 250,452 households that were served ads during the campaign
We compared the performance of the “Test Group” to the “Control Group to identify
the incremental lift
37. 37
CAMPAIGN METRICS – INCREMENTAL LIFT
Control
Cookies No Ad
Served
Test
Cookie Ad Served Lift
Unique Households 250,452 250,452 -
Total Conversions 2,875 3,198 323 or 11.24%
Total Revenue $66,078 $105,361 $39,283 or 59.4%
Total Donors 2,807 3,046 239 or 8.5%
Average Gift $22.98 $32.95 43.4%
Average Gift Per Donor $23.54 $34.59 46.9%
Connection360 generated an additional 239 donors representing an incremental
$39,283 in gifts
38. 38
Control Test Lift
Revenue Conversions AOV Revenue Conversions AOV Revenue Conversions AOV
Mail $54,672 2,542 $21.50 $77,842 2,616 $29.76 $23,170 74 $8.26
Web $8,551 233 $36.70 $22,829 447 $51.07 $14,278 214 $14.37
Other $2,855 100 $28.50 $4,690 135 $34.74 $1,835 35 $6.24
$66,078 2,875 $22.98 $105,361 3,198 $32.95 $39,283 323 $9.96
Segment Donor Households Donation $'s
Prospect 2019 $61,134
Lapsed 1027 $44,226
PERFORMANCE BY CHANNEL
Performance by Segment
39. 39
LIFETIME VALUE
1.58:1 ROAS
LTV Calculations:
Year 2: Retain 39% and AOV
will increase by 14.75%
Year 3 Retain 49% and AOV
will increase by 14.28%
Control Test Lift
Conversions Gifts Conversions Gifts Conversions Gifts
Year 1 2875 $ 66,078 3198 $ 105,361 323 $ 39,283
Year 2 1,121 $ 29,561 1247 $ 47,192 126 $ 17,631
Year 3 549 $ 16,546 611 $ 26,421 62 $ 9,875
$ 112,185 $ 178,974 $ 66,789
40. 40
CAMPAIGN SUMMARY
Ad Spend
Incremental GiftsROAS
Control Group:
No Digital Ads
Test Group:
Digital Ads
Served
Display advertising
provided a 46.9%lift in
Average gift as a result of
the banner advertising.
Control Group:
No Digital Ads
Test Group:
Digital Ads
Served
Total
Conversions
Conversions increased by
11.24% as a result of banner
advertising.
The Return on Advertising
Spend realized ~ .94:1
equaling $39,284
incremental gifts.
Average Gift per
Donor
$41,842
$39,284
2,875 3,198
$23.54
$34.59
.94:1 ROAS
46.9%
11.24%
41. 41
RECOMMENDED NEXT STEPS
Strategic
Plan
Analysis
Creative
Augment annual mail strategy with Connection360.
Evaluate program efforts on a quarterly basis.
Align on-line with off-line messaging to maximize conversions.
Continue testing creative, opportunity to test messaging, i.e.. Matching
funds.
42. 42
CONTACTS INSIGHT
Impressions served spike quickly in the first week of the campaign,
followed by a sharp drop for ~10 days.
Daily impressions were served at a relatively consistent rate per day
after the first few weeks.
43. 43
TEST VS. CONTROL
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
18-25 26-30 31-35 36-40 41-45 46-50 51-55 56-60 61-65 66-75 Over
75
Age
Control
Test
• Test and Control follow very similar age distribution
• The head of household for each group is more likely to be older, in
the range of 51-75 years old
44. 44
TEST VS. CONTROL
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
< $15K $15K -
$29K
$30K -
$39K
$40K -
$49K
$50K -
$59K
$60K -
$74K
$75K -
$99K
$100K
-
$124K
$125K
-
$149K
$150K
-
$199K
$200K
-
$249K
$250K
-
$499K
>
$500K
Income
Control
Test
• Test and Control follow very similar income distribution
• Majority of households have income within $75K -$124K
45. 45
TEST VS. CONTROL
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Super Buyer Heavy Buyer Active Buyer Moderate
Buyer
Low Buyer
Buyer Score
Control
Test
• Test and Control households follow even distribution
when segmented according to buyer score*
*Buyer Score is a measure of purchasing activity and purchasing capacity, on a scale of 1-100. A score of 90 represents the
90th percentile of purchasing activity and capacity as compared to the US population. This score is a proven predictor of future
purchasing behavior.
47. 47
CAMPAIGN INFORMATION
Campaign Objective:
Complement direct mail with on-line advertising for 3 month campaign cycle.
Evaluate the impact of display advertising on campaign response rate and donations.
Evaluate the mail package
Evaluate return on advertising spend (ROAS)
Campaign Scope:
# of Household Records- Mail File 1,000,000
Campaign Duration 3 months
Campaign Timing 10/10/2013 – 12/31/2013
Digital Campaign Spend $53,912*
48. 48
CAMPAIGN METRICS – FILE ANALYSIS
Initial Mail File 1,000,000
Total # of Targetable Households with Connection 360 Profile 950,098
Total # of Targetable Households with Cookies 588,439
% of Targetable Households with Cookies 61.94%
Total # of Households Served Ads During Campaign 245,210
% of Mail File Served Ads 25.81%
% of Mail File with Cookies Served Ads 41.67%
# of Ads Served 6,010,424
Average Number of Ad Impressions Per Household 24.4
Average Number of Ad Impressions Per Household Per Month 9.1
Brand Exposure:
245,210 Households were served 6,010,424 Ad Impressions over 3 Months
49. 49
CAMPAIGN HIGHLIGHTS
Ad Spend
Incremental GiftsROAS
Control Group:
No Digital Ads
Test Group:
Digital Ads
Served
Display advertising
provided a 23.7% lift in
Average gift .
Control Group:
No Digital Ads
Test Group:
Digital Ads
Served
Donations
Display Adverting produced
29.1% more donations
dollars.
The Return on Advertising
Spend realized ~ 1.49:1
Average Gift per
Donor
$53,912
$79,764
$273,792 $353,556
$64.28
$79.52
1.49:1
ROAS
23.7%
29.1%
50. 50
CONNECTION360 RESULT SUMMARY
Total Households Reached with On-Line Advertising 245,210
Total Ad Impressions Served to Households 6.010,424
Average Number of Ad Impressions Per Household 24.4
Average Number of Ad Impressions Per Household Per Month 9.1
Brand Exposure
Campaign Performance
Control Test Lift
Web $48,848 $108,707 $59,859
Mail $224,944 $244,849 $19,905
Total $273,792 $353,556 $79,764
Campaign Cost $52,912
Return On Advertising Spend 1.49:1
Connection 360 resulted in a net increase in gifts of $79,764
Return on Ad Spend = 1:49:1
51. 51
CAMPAIGN METRICS – INCREMENTAL LIFT FOR DIRECT
MAIL Control
Cookies No Ad
Served
Test
Cookie Ad Served Lift
Unique Households 245,210 245,210 -
Total Conversions 4,487 4,629 142 or 3.1%
Total Revenue $273,792 $353,556 $79,764 or 29.1%
Total Donors 4,259 4,446 187 or 4.4%
$ Per Household $1.12 $1.44 28.5%
Average Gift Per Donor $64.28 $79.52 23.7%
Average Gift $61.02 $76.38 25.1%
Connection360 generated an incremental 187 donors representing an incremental
$79,764 in gifts
52. 52
LIFETIME VALUE
Control Test Lift
Conversions Gifts Conversions Gifts Conversions Gifts
Year 1 4259 $ 273,792 4446 $ 353,556 187 $ 79,764
Year 2 1,618 $ 113,678 1689 $ 146,808 71 $ 34,130
Year 3 825 $ 80,570 861 $ 104,026 36 $ 23,456
$ 468,040 $ 604,390 $ 136,350
Lifetime Value
Return on Advertising Spend
2.5 :1
LTV Assumptions:
Year 2 + 38% retention and increase in gift of 9.3%
Year 3 = 51% retention and increase in gift of 39%
53. 53
PACKAGE PERFORMANCE
Mail Piece Control Test Lift
Conversions
Re-activated 1,584 1,637 53
Non Re-activated 2,903 2,992 89
Total Conversions 4,487 4,629 142
Revenue
Re-activated $78,143 $200,646 $122,503
Non-Re-activated $196,649 $152,910 -$42,739
Total Revenue $272,792 $353,556 $79,764
54. 54
RECOMMENDED NEXT STEPS
Strategic
Recommendation
Creative
Augment annual mail strategy with
Connection360.
Evaluate program efforts on a quarterly basis
Align on-line with off-line messaging to
maximize conversions.
Proactively leverage online advertising to
promote re-branding efforts
Continue testing creative, opportunity to
leverage rich media
