The True Cost of a Click

The True Cost of a Click

What is the price of a click? Facebook says a click Globally is $0.35 on average, this however is not the true cost of a click as implied by the title.

A marketer after exhausting thousands in ad dollars received tens of thousands of clicks to an ad only to realize that the sales needle did not move one bit, “Houston, we have a conversion problem”. All that money that you spend on running ads and not generating a single desired business outcome is the price you pay for planning a marketing campaign to be measured against clicks and not on conversion, but there’s more to the cost of overreliance on clicks as a campaign benchmark which drive businesses to make expensive marketing mistakes:


Focusing on clicks & not conversion reduces return on investment (ROI)

Marketers who believe that clicks directly affect conversions increase investment on pay-per-click ad campaigns expecting a similar uplift in return. But because of the lack of direct correlation between the two, coupled with the unpredictable and negative implications of fraudulent clicks, increasing clicks only guarantees an increase in cost yet may have no effect on the desired business action, thus decreasing ROI.


Focusing on clicks & not conversion creates wrong channel biases and opportunity costs

Marketers who focus too much on clicks, develop wrong biases on the effectiveness of certain channels. Search may yield 100% more clicks to a website compared to a social media post, and if conversion is not measured, regardless of its ineffectiveness for contributing to the desired business action, a marketer is most likely to increase spend on search, creating less chances for maximizing efficiency on other more effective channels.


Focusing on clicks & not conversion creates other audience insight biases that can prove dangerous to your brand

As the customer journey becomes more convoluted, conversion (& not clicks) are increasingly becoming important, ensuring that marketers are taking accountability over their audience’s changing behavior. Continuing with the above example, to the marketer, the search audience of mostly middle-income housewives will serve as the basis for the brand’s audience strategy, which then alienates the brand’s real audience who could turn out to be high-income millennials, poor decisions made on this false audience assumption will cost the brand much more than a failed marketing campaign.

A “2017 State of Inbound” report by HubSpot revealed that marketers in Europe and North America, ranked qualifying leads (prospecting) as their biggest marketing challenge, while Asian marketers are still finding it difficult to even generate leads. This further validates the region’s obsession over measuring clicks.

A shift in Asia’s marketing priorities is needed, focusing less on increasing ad investments while relying on deceptive metrics like clicks, and more on conversion measurement, ensuring that budgets and activities are efficiently geared towards conversion goals (such as lead generation). For the Asian marketer who is already spending the most on advertising, spending more ad dollars to buy more clicks is clearly not getting the job done. The frustration of the Asian marketer is made more apparent in the same state of inbound report, while 67% of its North American respondents felt their organization’s marketing strategies were effective, in Asia there is higher consensus that marketing strategies need to change.

Conversion measurement requires the right tools that allow audience interactions to be tracked all through out the customer journey, across whatever marketing touchpoint. It requires a thorough understanding of all above the line and below the line channels which generate millions of audience interaction data, these need to be gathered, and evaluated. Working backwards, measuring and optimizing conversions generates results, which affect ROI, and ultimately gives the business better justification to increase marketing spend. In the sequel to this article, “The Dynamic Duo: Conversion & Attribution” we will continue to explore the world of conversion optimization.


The Rise & Fall of Click-Through-Rates (CTR)

As Facebook is still the most widely-used social media site it serves as a good benchmark for click-through trends in the region. For marketers in Asia Pacific (APAC) the effectiveness of measuring CTR is supported by Facebook trends, revealing significantly higher CTRs, and lower costs compared to other regions. 2015/16 Salesforce reports support this by globally ranking Taiwan and Australia (2.02%) with the highest Facebook CTR, eighty percent higher than the global average (1.18%). In a Nanigan report, India, and Southeast Asia delivers 80% higher CTRs compared to the US (1.15%). Although Japan and Australia are ranked as having the most expensive Facebook cost-per-click (CPC) average at over $0.70, the rest of Asia is significantly cheaper, with Southeast Asia at only $0.11, fifty percent below the global average and fifty-eight percent lower than the US ($0.26). 

But it’s time to move away from “Clicks” as a comfortable benchmark. The first online banner ad appeared in 1996, and unsurprisingly generated a very high CTR of 44%,. As the novelty of the new ad banners faded away, so did the rate at which users clicked on them. As of March 2017,the average CTR on banner ads, according to Google’s DoubleClick, is only at 0.05%.  As CTRs continue to decrease, marketers are forced to increase investments into ad campaigns in order to reach the same results.

The obsession over increasing CTRs also led to clickbaits, web content with headlines designed to drive clicks to a website as cheaply as possible. Clickbait is essentially a modern-day successor to yellow journalism, a late-19th-century effort to sell newspapers in North America by prioritizing sensationalistic headlines over legitimate content.

While Chuck Norris, the Numa Numa guy and Mark Zuckerberg busied themselves with redefining the internet in the early 21st century, the market also became more saturated with brands and products, and the consumer’s consumption of online information changed rapidly. This transformed the customer decision making journey as it grew more complex, more sophisticated and multi-layered. On top of all this, our understanding of fraudulent & accidental clicks improved and this drove the need for an alternative metric, tracking conversions. Clicks ceased to be the only perceived justification for a successful campaign. 


Getting Comfortable with the C Word: Conversions

People at work don’t get why I love using the C word! I just want us to start focusing on CONVERSIONS that drive Return on Investment (ROI)

Anonymous Marketer

CONVERSION means any type of metric which indicates an audience has taken an action, thus being pushed one step further down the purchase funnel. Conversion metrics may come in various forms, and it doesn’t always directly or immediately correlate to a sale. Conversion may be measured as a completed sign-up form for a test drive, a visit to a site’s contact page, a subscription to an e-Newsletter.

Recent conversations I have with marketers paint a picture of customers going through multiple clicks, and marketing touch points before making a purchase, many dropping off in the process. As the path to a purchase decision is no longer as flat as it once was, moving away from relying on clicks and more towards conversion measurement as a campaign benchmark is important as it allows marketers to judge marketing channels on their effectiveness to contribute to the desired business action as supposed to offering a blanket credit on all clicks.

In a 2015 Google study, 51% of surveyed smartphone users claimed to have discovered a new product or company when conducting a search while 87% of consumers research before entering a store. In an earlier Deloitte insight report, 81% of respondents said yes to reading reviews and checking ratings which is why review sites like TripAdvisor, and information shared via social media platforms like Facebook, now play a crucial role in the customer’s decision making. Measuring conversion is very important in today’s modern technology and information landscape where consumers have grown to be more discerning and empowered, playing a proactive role in discovering brands and their benefits. 



Since the dawn of online advertising, marketers have been tracking click-through rates (CTR) and it remains the go-to-metric for gauging an ad’s effectiveness. Not only do clicks offer a straightforward way to track direct response, it is also easily calculated. A click on a banner ad means a new lead or a sale.


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