Let’s talk about advertising effectiveness. What should we, the B2B marketers, be looking for in the metric?

If you ask any B2B marketer about the objective of spending advertising money, most likely the answer is to look for business leads. But some marketers may not have a thorough understanding about how media agency works, how to begin a proper process that turns eyeballs into leads and all the way to a successful conversion.

To plan for a lead generation campaign, it always begins with the selection of right media. Seriously, media planning and buying are not easy tasks. It isn’t purely a bargaining process to lower the cost of advertising although the cost of media spending is a key variable to equate effective ROI.

Let’s say, a well-known top-tier financial media performs excellently in catching premium eyeballs with all the C-level decision makers in its demographic. But with the average CTR of this media has only 0.05%, that means to spend for a small scale 100 CPM campaign, you can possibly get 50 responses. Using the standard rate card of this well-known top-tier financial media, the campaign will cost you around USD15,000. Your cost per click is USD300.

Whether or not the USD300 cost per click is economically justified, the answer is relative across different industries. Although the well-known financial website may not be a suitable direct response media, an experienced media planner will still be able to optimize the campaign and manage it cost effectively.

In the “food chain” of advertising, there is something called remnant inventory. Basically these are the unsold ads inventory. So instead of buying the premium ad spaces, the planner can buy the remnant inventory with low CPM in the same website. With carefully designed frequency, recency, demographic and geographic targets, the campaign is now aimed at target-eyeballs instead of premium-eyeballs, the audience group may turn small, but it will lift the response rate.

Andrew Chen has a good piece “5 factors that determine your advertising CPM rates” in his Futuristic Play blog. It has good explanation about ads effectiveness. Worth a read.

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