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Notability 笔记

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86 views4 pages

Notability 笔记

Uploaded by

Sensor Canon
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Case study: ROI under multiple touchpoints

A retailer ran display ads and wants to calculate the ROI on the display ads.
The analyst wants to account for purchases via both click-throughs and
search-throughs. All calculations are done for a two-week period.
The average click-through rate on a display ad is 0.1%, which we will assume
can be attributed fully to the display ad. In terms of search-throughs, when a
customer is exposed to a display impression, her probability of searching for
a relevant company keyword on a search engine increases by 50% (see Lewis
and Nguyen (2015)1 for experimental evidence of spillover of approximately
this magnitude from display to search). The baseline (i.e., without seeing a
display impression) probability of a customer to conduct a relevant search on
a search engine is 0.8% in two weeks. The click through rate on a typical
search ad is 4%, which we will assume can be attributed fully to the search
ad.
The average CPM for display impressions is $2. A customer who arrives at
the retailer’s website through a click on a display ad converts to a purchase
with an average rate of 10%, and the average margin on a conversion is $18.
A customer who arrives at the retailer’s website through a click on a search
ad has a higher average conversion rate of 20% and also purchases more so
that the average margin on the conversion is $27. For search ads, payment is
only for clicks and the average cost per click (CPC) on search ads is $0.2.
Find the ROI on display advertising.

1
Lewis, Randall and Dan Nguyen (2015), “Display advertising’s competitive spillovers
to consumer search,” Quantitative Marketing & Economics 6(1) 93–115.
To calculate the ROI on display advertising, we need to follow these steps:

1. Calculate the total cost of display ads.


2. Calculate the revenue generated through click-throughs from display ads.
3. Calculate the incremental searches generated by display ads, the revenue from these additional searches, and the cost of
these additional search clicks.
4. Compute the ROI by taking the difference between the total revenue generated (from click-throughs and additional search-
throughs) and the total cost, then divide by the total cost.

Let's break down each step with the provided data:

1. **Total Cost of Display Ads:**


- Assume the retailer had 1,000,000 impressions for simplicity.
- Total cost = CPM cost * (Impressions/1000)
- Total cost = $2 * (1,000,000/1000) = $2,000

2. **Revenue from Click-Throughs:**


- Click-throughs = Impressions * Click-through rate
- Click-throughs = 1,000,000 * 0.1% = 1,000
- Conversions from click-throughs = Click-throughs * Conversion rate
- Conversions from click-throughs = 1,000 * 10% = 100
- Revenue from click-throughs = Conversions from click-throughs * Average margin
- Revenue from click-throughs = 100 * $18 = $1,800

3. **Incremental Searches and Revenue from Search-Throughs:**


- Incremental search rate due to display ads = Baseline search rate * Increase in search probability
- Incremental search rate = 0.8% * 50% = 0.4%
- Incremental searches = Impressions * Incremental search rate
- Incremental searches = 1,000,000 * 0.4% = 4,000
- Clicks from incremental searches = Incremental searches * Click through rate on search ad
- Clicks from incremental searches = 4,000 * 4% = 160
- Conversions from incremental search clicks = Clicks from incremental searches * Conversion rate on search ad
- Conversions = 160 * 20% = 32
- Revenue from incremental search clicks = Conversions * Average margin on conversion
- Revenue from incremental search clicks = 32 * $27 = $864
- Cost of incremental search clicks = Clicks from incremental searches * CPC
- Cost of incremental search clicks = 160 * $0.2 = $32

4. **ROI Calculation:**
- Total revenue = Revenue from click-throughs + Revenue from incremental search clicks
- Total revenue = $1,800 + $864 = $2,664
- Net profit = Total revenue - Total cost - Cost of incremental search clicks
- Net profit = $2,664 - $2,000 - $32 = $632
- ROI = (Net profit / Total cost) * 100
- ROI = ($632 / $2,000) * 100

Let's calculate the exact ROI value:

The ROI on the display advertising, after considering both click-throughs and search-throughs, is 31.6%. This means for every
dollar spent on display advertising, the retailer gains a return of 31.6 cents over the initial investment.
这道题涉及到的成本和收益有两部分，因为这⾥有两种不同的⼴告触点：展示⼴告（display ads）和搜索⼴告（search
ads），它们各⾃有不同的成本和转化收益。

1. **展示⼴告的成本和收益：**
- **成本：** 展示⼴告的成本是基于千次展示成本（CPM）计算的，即每⼀千次展示的费⽤。
- **收益：** 通过展示⼴告点击（click-throughs）进⼊⽹站并最终购买的⽤户产⽣的收益。这部分收益基于展示⼴告的点
击率、点击后的转化率和每次转化的平均利润计算。

2. **搜索⼴告的增量成本和收益：**
- **增量成本：** 由于展示⼴告的影响，⽤户进⾏相关搜索的概率增加，从⽽产⽣了额外的搜索⼴告点击和相应的点击成
本（CPC）。这是⼀个间接成本，因为它是由展示⼴告引发的增量搜索活动造成的。
- **增量收益：** 这些增量搜索导致的点击进⼀步转化为购买，产⽣额外的收益。这部分收益是根据增量搜索带来的点击
量、搜索⼴告的点击后转化率和每次转化的平均利润来计算的。

通过将这两种⼴告途径的成本和收益结合起来，我们能够更全⾯地评估展示⼴告的整体投资回报率（ROI），⽽不仅仅是
考虑直接点击带来的效果，还要考虑展示⼴告对搜索⾏为的影响及其间接带来的收益。

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