“In 2016, more than half of Fortune 500 companies saw their revenues decline.”
– Bob Liodice, CEO, ANA speaking at the ANA Masters of Marketing Conference in Florida, USA.
That’s an incredibly frustrating fact, but to what does Bob attribute this decline? Continued spending in a “byzantine, nontransparent, super-complex digital media supply chain”. Writing exclusively for ExchangeWire, Elliott Clayton, VP media UK, Conversant, believes brands can do three things differently to ensure that their investments generate positive return for their investment.
Look elsewhere for viable models
Media attribution is failing – it is a huge market that, by definition, is likely to fail at its key task: to measure. After all, to attribute is to assign value after the event, rather than to actually measure the value of the event.
According to Google: “An attribution model is the rule, or set of rules, that determines how credit for sales and conversions is assigned to touchpoints in conversion paths. For example, the last-interaction model in analytics assigns 100% credit to the final touchpoints (i.e., clicks) that immediately precede sales or conversions.”
The point is that it is not ‘attribution measurement’. Any model of attribution that can be altered to fit what you are looking at is not ‘measurement’. Or, to put it another way, a 30cm steel ruler is always a 30cm ruler and will always measure 30cm. It provides a measurement.
Now, if that ruler was made out of elastic rather than steel, the individual 1cm marks on the ‘ruler’ would no longer be a measurement. They would adapt according to what the person ‘measuring’ wanted to portray, stretching and contracting according to how the person handled the elastic.
This is attribution. It can be stretched to represent any truth presented to it. By definition, it isn’t fit for purpose. When assessing return on investment, measurement rather than attribution is essential.
Incremental measurement was the basis of massive industries that preceded digital, direct marketing being a great example. With incremental measurement, transactional data is critical, and concepts such as recency, frequency, and monetary value (RFM) are paramount.
When the next shiny object comes along in digital, the basic rules of marketing tend to get forgotten.
But, one of the facts of marketing is that the brand is everything. Outside of digital marketing, everything is done to improve the brand’s equity. This is what brings new customers and creates differentiation and profit.
It’s no surprise that the largest companies are the biggest brands. In fact, sometimes they are just brands – take Nike as an example, with few tangible assets other than intellectual property. But, in digital, we often forget the importance of branding: that brands generate demand.
Instead, we deliver high volumes of low-quality creative to capture existing demand, or to drive direct-response-based actions because they are trackable within an e-commerce environment. This high frequency of low-quality ads damages the brands themselves – the clearest example of this being the high prevalence of ad blocking.
Avoid opaque business models
Quite simply, if businesses that want to work with your brand don’t deliver frequency reports, or won’t work to consistent studies for incrementality, don’t work with them!
You wouldn’t pass your entire CRM file to an email provider in order to let them message your customers and prospects as much as they wanted, with whatever message they wanted. It would face rapid attrition and damage your brand relationship. So, why do so many brands do exactly that in digital media?
If a vendor can’t prove, or won’t work towards, incremental returns then it’s highly likely their model doesn’t generate growth. What other reason do they have?