May 4, 2016

Case Study: Is it helpful to buy premium formats for premium inventories?

premium-inventory

Are you buying more expensive placements and formats for higher prices in the hopes of higher CTR and conversions? Or do you prefer buying cheaper formats and more impressions?

We compared these two types of strategy for one of our clients.

Big format = Better CTR

In a prospective campaign (for new customers) we compared these two types of formats on CPEx inventories:

  • Premium formats: 480x300px and 300x600px, with a price floor of 60Kč CPT (2,2Eur)
  • Standard formats: 300x250px, 160x600px, and 120x600px, with a price floor of 40Kč CPT (1,5Eur)

CPEx covers Czech premium publishers. We bought ad placements and 3rd party data to target:

  • People with dieting interests
  • People with healthy lifestyle interests

The floor price for premium formats was higher than the standard-format price by +20kč CPT (0,74 Eur).

So, the price of the premium format was 50% higher. Here are the CTR data we collected:

ctr-format

Because of better CTR, premium formats have better CPC (cost per click):

cpt-cpc

Well, it looks like buying the bigger format is cheaper – in the CPC model. BUT…

Smaller format = Higher conversion rate

Using Google Analytics, we looked at how people behave on landing pages by comparing their time spent on a site with the number of pages they visited:

time

pages

For both the targeted segments, smaller formats provided better visit quality. So, are people who click on smaller formats more interested in the content of the ad?

We also took a look at conversion rates for retargeting campaigns for two formats:

conversion

Smaller formats had twice the conversion rate of larger formats. The data were similar for other formats. We do not have data for extra-small formats (e.g. 468×60, 300×50…) because we do not use them.

Conclusion

  • For a prospective campaign, it’s better to use bigger formats. Although CPT is higher, ads are more visible and have better CTR.
  • For retargeting and goal-oriented campaigns, it’s better to use smaller format ads (but not too small ☺) because CPT is cheaper and conversion rates are higher.

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