Traditional CPM is rapidly passing its ‘sell-by’ date
The traditional metric of cost per 1,000 page views (CPM) relies on the advertiser paying the website owner in advance to showcase their ad on the website for a certain number of times that the web page is accessed by visitors to the site.
Typically, CPM rates ranged between £4-£10 per 1,000 page views and could be more for reaching niche audiences. Website owners that sell traditional advertising on their sites have to be prepared to show advertisers detailed reports of page view visits and click-through rates in order to cash in on the traffic to the site.
Advertisers of course need more than just eye balls and click-through rates in order to achieve a return on their investment – they need a deeper level of engagement with desired audience and customer segments where the conversion ratio is much higher.
And many brand owners would be prepared to pay more for this. So it comes as no surprise that the Financial Times looks like one of the first website owners to experiment in offering a new way of renting its online real estate to advertisers.
The concept of ‘engaged time’ is now beginning to emerge as a serious alternative measurement to page views and click-through rates and the FT is now looking at selling display ads based on how long an audience spends with its content.
Jon Slade, commercial director of digital advertising at the FT admits it’s still early days. “We have a hypothesis we want to prove: that the longer you show somebody a piece of brand creative, the more resonance that piece of content has with an audience. That’s normally not how we value advertising; we’re talking about an attention economy.
“Are we honestly saying that there’s no difference to the brand between one second of exposure and five seconds of exposure? Logic would say: let’s start to value the amount of time spent with a brand.”
And of course Jon Slade has a point, hasn’t he? FT readers spend around six times more time with the FT site than other business news sites and that was worth something to advertisers seeking quality and engagement. So why shouldn’t they pay more?
“We could sell you 720 impressions at five seconds or other lengths of exposure, depending on the total time you would like,” he adds.
The current trial consists of figuring out how to find and sell the five seconds of time to C-level executives the right way and how to prove the greater efficacy of the approach.
Other publishers have also been openly mooting this as a new way for monetising content on their websites. In February this year, viral content site Upworthy announced it would use ‘attention minutes’ as its primary metric and YouTube is also moving in this direction.
One reason for this move away from CPM and click-throughs is that these metrics only a measure the effectiveness of a link promotion and are silent on the user’s experience on the piece of content itself. Research tends to show that pieces of content geared strongly toward clicks rather than engaging users results in less deep levels of engagement.
Measuring ‘engagement time’ could deliver a single metric for the quality of that engagement and be a much more accurate way of selling online advertising where it can be shown this leads to higher brand recall and purchase rates.