Would We Be Better Off If We Could Measure Less?

The day is coming where users online will be tracked via their phone’s geo location so that a click on an ad will be tracked all the way to the in store visit. Revenue from the store visit will be attributed to paid search ads and ROAS will plummet. Investment in paid search will go up but only to a point.

I think more surety that every sale is being attributed to sales accurately will give more false confidence that the amount being invested is exactly the right amount. Marketers will be convinced further and will become more entrenched in treating paid search solely as a direct response medium – you put X amount of money in and you get Y out, both online and instore. Budgets will be under an even bigger microscope because there won’t be any question of how many people are being driven in store and online.

The full effect of advertising is unmeasurable. The intention, motivation and inception of attribution for the majority of traffic is is utterly unknowable. More tracking can give a false sense of understanding.

Advertising drives sales but it also has a less appreciated side effect. Bob Hoffman explains in this post that it also buys business insurance. This is the reason why Apple, even with no new offerings and lackluster advertising is still producing incredible returns. He explains, “the prevailing attitude among marketers that everything is immediately measurable completely ignores the insurance value. One of the reasons people continued to spend their money to purchase Apple products was not likely the result of advertising that they ran in that quarter. It was because of the advertising that Apple had run the previous 25 years. It bought them insurance.”

The long term effects from advertising don’t show up in the paid search report that you are running. More data won’t help. In fact, more data might lead some to believe that if it’s not in the data, it doesn’t exist.

“Where is the Life we have lost in living? Where is the wisdom we have lost in knowledge? Where is the knowledge we have lost in information?” T. S. Eliot

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