What’s The Value Of A Click? – Does It Depend On Its Source?

Recently at a marketing event I had posed this question to Mahesh Murthy CEO of Pinstorm. I asked him whether the value of a click from Twitter is the same as the value of a click from SEM/Google Ads. His answer (much to my disappointment) was  a YES. Later I tweeted the same question too and some of the replies I got was that ‘If you figure that out then you will be the first one?’

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At the same time I had tweeted another question as well. It was “how many clicks = a conversation? or vice versa? How does one measure softer metrics like conversations, likes, retweets vs the CLICK?”

As we collectively dive into a world filled with Social media as IPL goes to youtube and My Name is Khan Premiere is Streamed in Facebook the question on the ROI of social media and the value of a click from social media vis a vis banner or SEM ads becomes more and more relevant.

Social media as you know is your social circle on the web. It more often than not has folks you like, know, trust, admire or adore. The latest launch by google buzz is also a move in that direction where in my friends and contacts on google can now share realtime updates and links with me.

Now question that arises is that I as a user who clicks on a link on say Google buzz am I more valuable to the website than lets say I the same user who clicks on a Google ad banner?

Well the answer may not be that simple but is one that needs some delving on. Some digital folks who read this may smirk and say ‘a click is a click is a click! I mean for god sake lets stop over analysing digital media!’

While I understand their frustration I believe we haven’t even started analysing digital media and what it offers in an intelligent manner. We folks like mathematicians have played with numbers and sold numbers. Because its very easy to sell numbers and right from the CFO to CMO in all companies understand numbers. But sometimes numbers are meaningless without any value attached to them.

For example:

We got 400 clicks vs We got 400 users on our site from 12 blogs and 8 tweets that recommended the customer experience at our online store. 19 of those users ended up shopping at our site, 200 registered and the rest bounced out.

While the above example over simplifies things you get what Im hinting at. I think its important that as an Industry we attempt at building more intelligence in the way we present ourselves. Digital shouldn’t be about clicks but it should be about ROI that is defined by intelligent analytics that drive value and not traffic only.

10 Responses to “What’s The Value Of A Click? – Does It Depend On Its Source?”

  1. sumayya
    February 17, 2010 at 11:22 am #

    Excellent read. I am glad there is someone analyzing this stuff and making it available to masses for free. I think a click from Twitter will be almost close to the banner ad on google. In fact it might provide even more interaction with the advertiser. Banner ads do have a certain negative effect at times. Tweets haven’t developed that image yet.

  2. Cerin Pathrose
    February 17, 2010 at 11:23 am #

    Let me quote Einstein – “Not everything that counts can be measured. Not everything that can be measured counts.”

    Value of a click depends on its source. It’s unfortunate that we do not have a scale to measure. This dilemma is an extension of measuring PR Value in the traditional media.

  3. February 17, 2010 at 12:06 pm #

    Hi Rajiv!
    I am surprised by reading this post to know that web sites analyze so much on clicks and evaluate the clicks based on the source of the click. This actually changed my thoughts on digital marketing and compelling me for making a research on this. Nice post! Thank you.

  4. February 17, 2010 at 3:03 pm #

    I read somewhere a quote on why people share, goes like this… I talk to my friends about brands, not because I like brands, but because I like my friends…

    Twitter, or otherwise, maybe the question to ask is; is the value of a click worth more if it is a part of the conversation economy, or of the traditional push economy, of which contextual advertising is still a part of.

    So I think, no one who really like their friends are busy pushing out links. If ever there’s something being shared, it is of genuine value to either party in some way. I asked my friends about what mobile to buy, and get a few links. Rather than I searched for a mobile and got a few links…

    So while the former is contextual, as is the latter, I would value friend recommended link higher.

    Having said that I am struggling with a phone I bought because a friend said it was good. Bummer :(

  5. Curious Mind
    February 17, 2010 at 4:11 pm #

    Interesting read rajiv… I think to some extent you answered the question yourself towards the end.. I think value (and thereby cost/price) is defined by the customer.. in this case the person who is paying for the click (the website owner)..

    If i am buying clicks to just drive traffic to my website.. and not interested in the user behaviour thereafter… i think “a click is a click” would hold and i will pay the same amount..

    But if i am expecting certain kind of activities after the first click.. may be purchase or registration or certain time of my website.. then i would be interested in knowing more about the sources because i think there would be a potential for me to allocate money in a way that would give me better ROI

  6. Reader
    February 18, 2010 at 12:37 am #

    if you really want to measure the clicks with their source…start using analytics and dont you think we are already selling digital medium on ROI. Gone are the days when there was no measurement of ROI for digital campaigns.

  7. February 18, 2010 at 10:29 am #

    I cant recall who said this but one of the most interesting answers or rather an analogy i ever found to the entire question on ROI on Social Media was – Whats the ROI of your phone?

  8. February 19, 2010 at 11:44 am #

    I agree with mahesh murthy.

    Why the value of click from PPC Ad or social media ad is similar?

    I recommend an ad to my friend,the friend visits the site and makes no registration and just bounces off the site.

    As a site owner does it matter to me whether the visit came on someone’s insistence…NO it does not matter cos in the end that visitor made his choice of not embracing my site just like any search engine visitor.Even if he does register on site he uses his knowledge to check whether he really requires the service or not.

    Another point – the value is almost similar because a search engine visitor sticks on a ad page for few mins cos he believes that he made a wise move in clicking that Ad.Similarly a social media visitor sticks to a page cos one of his friend referred it(loyalty factor).

    So value wise social media clicks hardly differentiate from other clicks.

    • February 19, 2010 at 11:47 am #

      Thanks Raghav – If you would spend time on analytics and post visit user activity your thoughts might be different. :)

  9. Nikita
    February 19, 2010 at 2:17 pm #

    The value of a click is higher if it has a higher probability of getting click by potential customers/ intended market segment. Also, Social Media is actually not meant to be measured the roi of. It’s meant to build relationships, it’s meant to increase mind-share not market share of a product. More later..

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