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Marchex Report Analyzes The Real Value Of Mobile Display Advertising

Stocks in this article: MCHX

Marchex, Inc. (NASDAQ:MCHX) today released an in-depth study on mobile display advertising, finding that advertisers who spend on mobile banner ads to attract new customers receive an exceedingly poor return on investment.

The report, titled “The Downside of Mobile Display Advertising: How Performance Advertisers Lose Big on Banners,” found that advertisers can overpay by more than 10X to generate one quality customer call.

Marchex, a mobile advertising company focused on calls, examined a set of advertising campaigns across six major mobile display ad networks. The goal was to investigate the immediate rate of return on banner ads and understand how well these ads performed in terms of getting customers to call a business from their mobile phones.

Researchers analyzed data to determine if impressions (ad views) and clicks, the measurement tools of banner ads, actually translated into real customers.

According to the study:

  • It can take an average of nearly 500,000 impressions to generate a quality phone call.
  • Mobile display advertising is significantly overpriced when it comes to acquiring new customers.
  • Clicks are not indicative of customer intent. This means there can be high rates of accidental clicks on mobile display ads.
  • Mobile display ad performance varies wildly. In one case, a campaign that got 1.4 million impressions did not result in one quality phone call.

“The findings surprised even us. The number of people clicking on an ad really had no direct bearing on how many new customer phone calls a business got,” said Chen Zhao, principal analyst for the Marchex Institute, the research arm of Marchex. “That ends up making mobile display a guessing game for advertisers who want these quality outcomes.”

To download the entire study, please go to http://www.marchex.com/mobile_performance.

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