Wednesday, September 16, 2009

About PVC: A Key Metric for Media Sites

This article provides an overview of a key conversion metric for a media sites: PVC. It provides a measure of the pages most involved in driving page consumption, whether that is overall consumption or the consumption of specific high value pages. If you are a CMO or report to one, you will care about PVC.

  • Here is what we will cover:
  • What is PVC?
  • How is it related to other metrics?
  • How is it used?
  • Extending the metric.

What is PVC?

PVC stands for Page Velocity Consumption.

Page indicates that this is a page based measure. Velocity is a term taken from Economics and is a measure of how much money is circulating in the monetary system. In this case it’s a user, not money, which is circulating1. Consumption is about how much that user is circulating. As we will see, for media sites the metric is correlated to revenue.

When a page, page set, or link is seen or clicked by a user we begin counting all subsequent pages in the visit. It is the average count of pages consumed in a visit after touching a particular asset (page, page set, or link). So the PVC calculation is “pages seen after / visits”.

A simple PVC example:

A simple PVC example

In this case the PVC for page 1 is 4. Note that we count from the first “view” until the end of the visit. Even though Page 1 is seen twice, we only count from the first view. The PVC for the second page is 3.

Here is an example of counting from a link click:

A link click PVC example

In this case, the PVC for the link on page 1 is 3. We don’t count the page the link was on because that view was before the click action to be tracked.

PVC can be thought of in a number of ways

For many media sites driving additional PV is the purpose of every page or application. Over many visits, PVC is a measure of the likelihood to drive additional page views. PVC can be a measure of “Persuasion Architecture”2 (from Brian and Jeffry Eisenberg) when applied to media sites.

PVC measures the downstream impact of changes made to the site. On most media sites the paths people take through the site are just too numerous to be useful. However, PVC lets you see the impact of changes to a given page or page set over many paths. If the goal is to drive additional page views, does your new page lead to a more or less involved experience?

PVC is an engagement metric. It is different than regular Page Consumption (PV/Visit) in that it measures consumption over the whole visit, not just for the page or within the page set.

PVC is a conversion metric for media sites that sell ad or sponsor impressions. It is thus correlated to Ad revenue or Sponsor revenue. It is a conversion metric similar to Average Order Value (AOV) on commerce sites. (We will discuss Sponsor PVC later in this article).

Because it reflects revenue, PVC is used to measure business optimization. That makes it a key metric concerned with the economic success of the company and its strategic goals. Any CMO should care about that!

How is PVC related to other metrics?

  • PVC is a metric used to understand the ability to convert. Examples of other standard media metrics are:
  • Repeat use (Visits/UU).
  • Page Set Contribution. (PV/Site Visits).
  • Page Consumption (PV/Visit).
  • Click Through Rate (Clicks/Impressions).

These metrics and PVC are used together to understand site activity and contribution to the site. Sometimes these metrics are used to understand usability, sometimes product viability, sometimes campaign success. Usually PVC is used to understand business optimization.

  • Like the other metrics in the list, PVC is also available to track site performance at various levels of granularity. This makes it excellent for inclusion in monitoring reports. Levels of tracking can be:
  • Site
  • Page Set (Page Type, Tool, Product, Subject, etc.)
  • Page
  • Link
  • Tracking PVC at various levels allows you to monitor the larger trends and then drill down to identify what component of the site is driving that trend.

PVC is most closely related to the Page Consumption metric (PV/Visit). In fact, at the site level they are the same number. PVC can be used as a segmentation of site wide Page Consumption.
The difference between PVC and Page Consumption for a given asset measures the ability to drive additional page views (PVC - Page Consumption) for that page or page set.

PVC, like most of the other metrics in this list, is based on a visit. This provides some consistency between these metrics. However, if your technology supports it, PVC can also be based on visitors and longer time periods such as pages per month or per quarter.

How is it used?

Page Velocity Consumption can be used to identify trends in consumption over time. For a given asset (page set, page, link), is the trend showing improvement? By segmenting at various levels of the site, you can identify what components are driving that change. For example, look at individual pages for a given page set or at individual links on a given page.

It can provide a measure of the overall business outcome for changes you intentionally made to an asset. For example, the CTR of a page may have doubled, but the overall engagement may have gone down. In this case, you may have lost money overall. Compare the PVC values before and after the change to determine the level of impact.

PVC can provide a measure of relative value for different assets. Do some assets provide a better monetized visit than others? Can a high performing asset be better utilized by driving more traffic to it? For example, if you track tools or applications, compare the PVC values for the various tools. If you track content by subject, compare the PVC value for the different subjects. You can go further and compare the values of the pages within a given subject.

Here is an example of a PVC report in Omniture (the real values have been changed):

An example of a PVC report in Omniture

Extending the metric

A variant of PVC is Sponsored PVC. Some media sites allow the sponsorship of specific pages. In this case, the Sponsor PVC metric is constructed by counting only the sponsor pages seen after touching a given asset. It is analyzed in the same manner as PVC. One can then go further and look at which sponsorships the asset drove to.

Ads and sponsored pages are not likely to all have the same value. So the monetized value of pages can be different. PVC can be extended by incrementing the value of the page instead of simply incrementing the count of the page view. Pass the summed value of the ads on the page or its sponsorship value. This will provide a measure of the monetary contribution of the asset to the business. As Avanash Kaushik might say, “How cool is that?”

The PVC concept can be used to track value by referring sources or campaigns. In this case, you are tracking the PVC value from a source rather than an asset on the site. (The number is the same as if you calculated Page Consumption where the entry source was X). The source could be a search engine, direct traffic, newsletters, etc. Simply pass the value for the referrer on the landing page and start counting. You could then answer questions like which keywords are driving the most consumption and should I buy more?

1This explanation of “velocity” was provided by the Jared Cook at Omniture.
2Brian Eisneberg & Jeffry Einenberg, Call to Action: Secret Formulas to Improve Online Success (Wizard Academy Press, 2005).

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Sunday, August 9, 2009

Monitoring Reports and their Attributes

Reports can be generalized into different types. For example there are testing reports, ad-hoc reports, predictive reporting, dashboards, etc. They have different purposes. The most common type of reporting is a monitoring report.

Monitoring reports are intended to do just that: monitor. They contain the metrics for your site or product that you look at all the time. This differentiates them from reports that are meant to answer specific short term questions such as testing reports or ad-hoc reporting.

These reports are not necessarily actionable based on the report alone. Changes in your reports are often investigated further to determine the cause of the change and the appropriate action needed.

The monitoring report contains the metric drivers for the business and detail about the components of those drivers. For example, if a key metric is repeat use, the report would also provide the visit and visitor components of the repeat use metric. It would also provide the tracking level below to see what contributed to the higher level figure. For repeat use for the site overall, this lower level of detail might be the repeat use by site section, application, or other functional area.

The report is often presented in a trended view and/or in comparison to other similar site elements. In the first case, you are comparing the thing being tracked to itself over time. In the latter case, you are looking at relative value. These become your benchmarks by which you evaluate your tracking.

The report, by nature of its purpose, is provided on a regular schedule. This can be monthly, weekly, daily or whatever the business needs. If you don’t need the information on a regular basis, then it does not fall into this category of reporting.

In order to do apples-to-apples comparisons the report needs to be consistent over time. It should track the same metrics in August as it does in January. Because the reports are consistent they are often be automated. In fact, the site itself should be built to specifically track these metrics consistently.

Note that this is a report and not a dashboard. A dashboard is meant to contain only the top level KPI and would not include the level of detail one would expect in a monitoring report.

When asking your analyst for reporting, keep in mind what kind of report you are requesting. This will help both you and your report provider to better understand the goals of the request.

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