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“Figure out what’s working and double down on it” is common advice in the entrepreneurial space. It’s good advice, too! It works — to a certain extent.
Measuring the ROI of marketing, PR, or advertising and attributing sales to the right channels has always been the Achilles’ heel of the industry. We have all these fancy analytics tools and dashboards where we can seemingly track everything that matters.
Armed with the knowledge of who clicked, who bought, who (un)subscribed, and where all these people came from, you’d think we’d always know exactly what to do to double/triple/quadruple our revenue overnight.
We don’t, though, and it’s often precisely because we’re drowning in (the wrong) data and chasing (the wrong) metrics.
“When a measure becomes a target, it ceases to be a good measure”
This is Goodhart’s Law and it’s perfectly applicable to marketing.
Marketers turn a lot of metrics into end goals to justify their investment and to prove to their higher-ups that their work is meaningful. Enter attribution and accountability, marketers’ kryptonite.
Attribution = you spend X amount of $ to make Y amount of $.
Example: you spend $5K on ads to make $20K. Fairly simple and helpful, right?
Right, but not every sale can be attributed or mapped back to a tactic. Worse yet, attribution is often a fool’s errand because your data is flawed.
Instead of accepting that marketing is NOT an exact science, we came up with a ton of metrics that we turned into goals in a futile effort to prove marketing ROI.
Reach, views, follower counts, traffic, subscriber counts, downloads, engagement rates — all of these are valuable but you can rarely attribute sales to them. This is precisely why, as Goodhart advises, they should never be end goals.
They are stepping stones.
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Why marketing metrics and analytics are fundamentally flawed
The attribution obsession kills good marketing opportunities because you end up using most of your budget or time on PPC or social media (something you can measure) and end up nixing PR/earned media efforts because sales are harder to attribute to them.
All marketers get giddy when they can measure CAC (Customer Acquisition Cost), CPC (Cost Per Click), CPL (Cost Per Lead), and so on. It’s trackable and attributable → accountability is demonstrated.
Is it, though?
Some of these models are fundamentally wrong and they make you waste a ton of money/time:
- Retargeting ads i.e. showing ads to people who visited your website before. You’re going to attribute the sale to the ads, although they may have just postponed buying and would have bought anyway.
- Organic social media views and reach come with quick dopamine hits. Likes, shares, and comments keep us going. But have you tracked the number of hours you spent on social media last week? How many sales/hour can you attribute?
- Doubling your ad spend doesn’t necessarily mean doubling your sales. You might have reached the ceiling of your TAM (Total Addressable Market) and need to double down on converting the people you already reached instead.
- An old marketing rule of thumb says that it takes 7 touchpoints until a prospect acts on your CTA. This means that you need to repeat your message several times. You usually attribute the sale to the last touchpoint and that may be entirely false: the purchase decision could have been made months ago. Your prospect was just waiting for a cash influx to pay for it or for a window of time to place the order.
It’s very easy to get lost among so many metrics: impressions, views, clicks, and so on. Ad-selling companies like Google and Meta will give you hundreds of metrics because they know you like them.
This isn’t just about paid growth tactics. Social media platforms will drown you in metrics as well and get you to spend more time on their platform just so you can get that million views already.
And yet, some of the best tactics are impossible to measure or to attribute sales to.
To attribute or not to attribute — one of the fundamental questions of marketing
My formal education (bachelor’s and master’s degree) is in PR and comms. We were taught that PR efforts are hard to measure and that you will always be struggling to prove your work’s worth to the powers that be.
We were also told that you see the ROI of PR when you stop doing it.
My professors were right on all counts.
When you stop investing in media relations you see your sales, your brand awareness, and your reputation dwindle, even though you were never able to attribute any of it to earned media.
Many things in marketing and especially in PR are hard to measure and attribute. You never know their exact ROI. You know the negative ROI of not doing them, though.
Balance! Where’s my balance?!
So should you stop measuring things altogether and just wing it?
Absolutely not!
Keep measuring everything you can measure but be wary of assigning goal value to your metrics.
Always look back at the goals/overarching objectives in your marketing strategy. Can you track your tactics back to them?
I’m not talking about attributing sales, mind you, but about doing things that move the needle toward your goal, attribution be damned.
By the way, my Guided Marketing Strategy Template includes a handy way of tracking your tactics back to your goals.
The real trouble with the excessive focus on metrics and attribution is that it prevents you from investing in assets/tactics that compound with time and bring sales but are harder to track, like content, SEO, or earned media.
Hard-to-measure and hard-to-attribute things you should STILL do
Branding: you can’t tell who bought because your branding is spot-on but that doesn’t mean you should stop investing in branding.
Organic social media: remember the point above about needing 7 touchpoints to make a sale? Don’t give up on promoting your products on social media just because the first 3-4 posts didn’t net you any sales.
Organic content and SEO: both are excellent ways of getting discovered and/or converting people to your email list. Ideally, push more BOFU and MOFU content (I wrote about this in my recent 2024 trend analysis).
Keep on increasing your audience size: there is a direct correlation between sales and audience size, even though it may not be obvious in the beginning.
I’m teaching the Audience Accelerator workshop in February. If audience growth is one of your 2024 priorities, join the waitlist and be the first to know when it goes live.
Earned media: being a guest in podcasts, getting quoted on other websites, being featured in various media outlets — all these are hard to track but have a huge contribution to your bottom line. They are excellent trust and credibility signals!
Social proof: websites like Capterra or G2 (where most people look for social proof for SaaS companies) may not net you attributable sales. But people will check them before buying from you. The same goes for all your testimonials, reviews, and case studies. Their clickthrough rate may be low, but their contribution to sales is huge.
Common sense and intuition are underrated metrics
Most things that lead to people discovering your brand or trusting it are hard to measure and to attribute sales to.
Without them, though, yout audience growth stagnates and your credibility becomes shaky.
Is there data to support this? Some, but it’s not conclusive — for obvious reasons.
However, common sense and intuition point straight at these tactics, measurable or not. You’re more likely to trust someone who’s been featured in Forbes than someone with 100 social media followers who promises you the world.
This is why, out of all of the above, earned media is my favorite, followed closely by social proof.
They are the absolute needle-movers. When in doubt, this is what your leads will look at before they buy.
In 2024, add earned media to your list of priorities. Go on podcasts, live events, use websites like HARO or Qwoted to get your name out there.
Did you Google yourself recently? If all you can find are your own website and social media profiles, it’s time to work on earned media!
That’s it from me today!
See you next week in your inbox.
Here to make you think,
Adriana
P.S.: This topic was requested by my friend Hannah Szabo. If you want to see your own topic featured in an upcoming issue, fill in this form.
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