Dare to Succeed in 2019: All-Time Marketing and Other Measurement Trends
December 13, 2018
There’s a quote I’m fond of, from a guy who’s done his share of measuring.
The words have helped on many occasions, so poking holes in them has me feeling a touch ungrateful. That said, I’ve come to learn that Charles Schwab’s assertion — “The best place to succeed is where you are with what you have” — is profoundly intelligent if your goal is to create content that generates ROI, but acutely ill-advised if your goal is accurately measuring ROI for your content.
Let’s start with when it makes sense to strive for success with what you have.
We all need revenue-generating content in one form or another. But how best to produce profitable content while not wasting resources on “flops”? The answer is in our proven winners. Proven winners are easier to “bring back” and “riff off” because the renditions and offshoots typically succeed at a higher rate than net-new content. From our proven winners, we can create all-time winners.
The Smartest Companies Invest in All-Time Content
Saturday Night Live’s recent Netflix commercial parody makes light of the streaming company’s seemingly insatiable appetite for creating new content. The gag is that Netflix’s goal is the “endless scroll.” When you reach the bottom of the menu, new shows will have already been created at the top of the menu, “and thus the singularity will be achieved.”
The spoof posits that Netflix can make the endless scroll a reality because they “buy everything,” often without thought. It’s funny because it feels true, except it’s not entirely true. Netflix won’t touch two topics in particular: news and sports. Reason being, news and sports offer no “lifetime value.” People tend to only watch this programming once. Also, when’s the last time you watched old news or sports? Immediate, steep depreciation is the norm for most types of real-time content.
Netflix aims to create all-time content with a high lifetime value. The company does so through focusing on what they’ve figured out: success is most easily found from working with your winners. In other words, Netflix capitalizes on its old stories, as do entertainment heavyweights like Disney and Marvel. All three have mold-breaking budgets, but for ROI purposes, all three tend to stick to their proven molds when creating new content.
In the video below, LinkedIn’s Jann Schwarz explains why marketers are smart to find new ways to succeed with their tried-and-true content. He also sheds light on why Oreo’s famous “dunk in the dark” campaign spent too much time in the spotlight, and calls your attention to what may be the most underrated KPI in marketing.
When does it not make sense to succeed with what you already have? When what you have can be detrimental to your success.
Measuring ROI, Fast and Slow
You prefer simple answers over hard ones. That’s not a knock on you, it’s a knock on all of us – we’re innately hard-wired to choose an easy decision that’s wrong over a hard decision that’s right.
Proving this point are two widely-used metrics for measuring marketing ROI: click-through rate (CTR) and cost-per-lead (CPL).
CTR, a metric that currently determines where billions of marketing dollars get spent, in no way correlates to brand awareness or sales. Worse, CTR is often a negative indicator. We typically throw more money at campaigns with the highest CTR even though those clicks – such as those from clickbait headlines, low-frequency campaigns, and targeting robots – are often detrimental to our brands.
CPL is considered a step up from CTR, and is almost universally used by B2B marketers. But it’s still too easy, and thus not effective for measuring ROI on its own. How is CPL too simplistic? Well, suppose Channel A gets you a $5 CPL and Channel B gets you a $100 CPL. Why not take Channel B’s budget, pour it into Channel A, and problem solved, right?
Maybe, but what if your $100 leads became customers 30% more often and spent 10% more over time? Without this context, our “effort” to optimize for CPL just pulled the plug on a profitable channel and funnelled its budget into a less profitable one.
The harder decision is to allocate your budget based on something you may not already have: revenue-per-lead (RPL). There’s no question that RPL is more difficult to track than CPL, but if you are dead-set on making decisions that lead to greater lifetime value, the choice is to slow down and measure more thoughtfully.
Check out the video below as LinkedIn’s Peter Weinberg expands upon the marketing world's analytical shortcomings, and then makes a convincing case for marketing ROI measurement that’s more scientific.
In short, if attempting to create ROI-generating content, start with what you’ve got. If attempting to accurately measure the all-time value of your content, realize that it may be time to scrutinize the science by which you're measuring ROI.
Check out our B2B Marketing Trends site and let’s bravely venture together into the new year.