Back in 2015, a leading mobile gaming firm ushered in a new era by hiring a CMO deeply rooted in brand development. Despite spending nearly $1M daily on ads, mostly performance-driven, this visionary CMO chose an unconventional route. He halted all advertising campaigns for the month of February.
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The objective? To understand the actual value obtained by all marketing activities, before restarting channel after channel, in order to see what the actual incremental contribution each channel brings, and based on this, adjust the level of ad spend, or completely cut off channels which bring no value.
So, what did this “strategic hiatus” yield?
After trying this bold experiment, the results were eye-opening. The company realized that half of their advertising money was being wasted. With this knowledge, they shifted their funds to more effective campaigns and partnerships.
With each passing year, the CMO reiterated this experiment, consistently uncovering similar findings. They recurrently trimmed its ineffective ad spendings by half. This analytical approach resonates with John Wannamaker’s iconic statement,
“Half the money I spend on advertising is wasted; the problem is, I don’t know which half.”
John Wanamaker (1838-1922) was an American merchant and advertising pioneer
Fast forward to the age of user tracking:
By 2015, brands and ad platforms had a lot of access to detailed user data. But things started to change in 2016 when Apple introduced Limited Ad Tracking on iOS. Google’s similar feature didn’t have much impact until 2022.
During this time, everyone thought they had the perfect tools to measure digital advertising success.
Mobile tracking platforms became very popular, with some even claiming to be better than big names like Facebook and Google. But a big surprise was coming.
A leading advertiser did a study and found that 80% of their ad money was being wasted. Even worse, many ads they paid for didn’t even exist. It turned out some platforms were tricking advertisers into thinking they were getting better results than they really were.
Understanding Incrementality in Marketing:
Pausing advertising together, and restarting ad platform by ad platform to evaluate the true contribution was what is called an “incrementality study”.
The goal in such a study is to create an experiment by creating a significant change that should produce a significant outcome, in comparison with a hypothesis. It was a painful process, making some performance marketing managers shake in their seats, as there was a true empirical test, showing the actual value of marketing activities.
What does our expert say about incrementality?
“In an era where traditional attribution is fading, incrementality seems to stand out as the best option, and maybe the only in the future. It provides an alternative lens into ad impact, ensuring we’re not just tracking, but trying to understand how each cent is doing.”
Pablo Perez | Performance Marketing Director @ Admiral Media
Attribution: A Double-Edged Sword?
Imagine you believe half of your sales come from paid ads and the other half from natural, unpaid sources. You’d probably think that if you stop all ads, your sales would drop a lot, maybe by 80%, in a few weeks. But what if you stop the ads and your sales stay the same? This highlights the difference between tracking individual users’ actions and the older method of looking at the overall increase in sales.
In the chase for simplicity, user-based attribution may have oversimplified a complex puzzle. By allocating credit solely to the final user click before a conversion, it undermines the multifaceted customer journey involving multiple touchpoints.
With the dwindling ability to track users, primarily due to new restrictions from Apple and Google, advertisers all over entrenched in user-level data faced anxiety. However, those versed in broader measurement methods flourished.
Traditional ways of tracking were too simple. Now, we need a better way to measure success.
Using methods like incrementality or new tools helps brands get a clearer picture, instead of just relying on one possibly incorrect piece of information.
Lastly, a commendation is due to INCRMNTAL. They’re leading the way in ad tracking, and their tool does it all without needing individual user details.