" On average, user-generated content (UGC) sites provide a lower cost per conversion than non-UGC sites. That's the surprising finding from a new study published today by BlueLithium Labs, the research division of ad network BlueLithium.
Questions about the brand risk of running ads within or adjacent to user-generated content have been debated extensively in the advertising trade press. However the issue of whether user-generated content Web sites perform as well as editorial Web sites for marketers has not been explored. BlueLithium had, in fact, received queries from its own marketing clients regarding the price performance of UGC vs. non-UGC Web sites, so to help answer that question for its clients, the company undertook a thorough, unbiased, nine-month quantitative study. BlueLithium Labs analyzed the performance of campaigns that included 716 ads and more than 1.7 billion ad impressions between August 2006 and April 2007. The study focused on two key factors: the number of conversions registered for each campaign and the cost of the media. "Conversions" included a range of actions such as completing an online purchase, registering for a program, signing up for a service or requesting more information. By dividing the number of actions by the cost of the media, the study arrived at a "cost per conversion" for each campaign. It's this "cost per conversion" that marketers use to determine the bottom line effectiveness of any media, and thus the metric that was used to evaluate the effectiveness of UGC vs. non-UGC sites. "
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