Hello! And welcome back after the last of the bank holidays until the end of August, still nearly 3 months away. I’ve never been a big fan of bank holiday Monday’s, as it always feels like you’ve been given an extra Sunday, whereas an additional Friday or Saturday would have been more welcome. One of the things that I’ve enjoyed about writing this blog has been the freedom that it has given me to explore the various aspects of online monetization and the wider field of making money from digital.
Much of my spare time seems to be comprised of hanging around with other people who work within digital & online, where we spend many happy hours discussing how things are developing and probably sounding like complete nerds to those around us. Such was the situation last Friday when me and an old colleague found ourselves drinking past the point when our more sensible companions had called it a night and gone home.
It turned out that both of us were getting concerned about the funnel trickledown effect as we termed it, and how this was skewing how things were viewed in online monetization. Performance marketing concentrates at the sharp end of the funnel as it were, the area within which audience and traffic has reached a point where a purchase action is likely. So much focus has been put on this part of the funnel and it’s almost mythic properties of ROI that it’s become easy to forget that other less immediately measurable bits of it exist.
This is a problem which I feel afflicts not only performance marketing, but all forms of promotion, and it stems from a desire to make each individual element accountable and measurable. This was evident at the recent social media conference I attended and is probably extant everywhere from merchandisers trying to measure the effectiveness of in store promotions, through to direct mail.
The process and amount of touch points and influence that it takes to drive a purchase is of course extremely difficult to measure. It is after all much, much easier to measure part of the process. Part of this would be the measurement of paid of search effectiveness within Google, where it is relatively easy to calculate the ROI of spend. This though necessarily assumes that this part of the process happens in isolation from anything else, and that the profit relating to it should solely be associated with that activity.
To me this is flawed reasoning, but difficult to argue against, since the correlations between activity at the top of the funnel (branding activity, brand perception, strength etc,) can take to filter down and that it would be impossible to measure everything that can effect a decision. So far, so what? Well what I am talking about here is that by measuring success and determining strategy solely around performance marketing, is like determining everything around the success or not of a point of sale promotion.
I work in performance marketing, and I believe in it. We should however look at it more as part of the overall marketing and perception strategy, and how successful it is for a particular product or brand can be seen as reflection on how the rest of process through the funnel is working. Again comments welcome, and apologies for the delay between the last blog and this.
Rob