“Is digital marketing a bubble?”
Really missing all online marketing effect? The best way to find out is to experiment and not let other advertisers’ experience become a general truth, writes Iprospect’s Erik Luhr and Martin Styrhagen.
IF OUR INDUSTRY does not adopt a scientific approach to how marketing works or does not work, it will lose its influence, says Jenni Romaniuk at the Ehrenberg-Bass Institute for Marketing Science . We are prepared to agree, which is perhaps why it feels a little sad to see how a poorly substantiated article that drives the thesis that all online marketing has no effect has been extensively shared on social channels in recent weeks.
The article is called “The new dot com bubble is here: it’s called online advertising” , and as the article title suggests, the authors believe that our industry to half (50 percent of all media investment is digital) is built on a false belief in the effect in digital marketing.
Particularly disadvantageous is the effect of digital channels on short-term sales, and the article can be summarized as follows:
Ads in search results have no effect, and the effect of Facebook advertising on short-term sales is greatly exaggerated.
We want to explain why the conclusions the article draws are incorrect, at least on the basis of the data the authors had available.
An advertiser is not a selection
The article mentions one (1) advertiser by the name, Ebay. In 2013, Ebay told the world that search results ads do not work for them. The motivation was that Ebay saw no difference in sales when they stopped buying ads on Google, the organic results simply picked up all the traffic that had previously gone to paid ads.
No emphasis is placed on trying to understand why this was the case – could it have been that eBay’s previous heavy investments in search helped create the behavior they could now enjoy, for free?
Regardless, we would like to see an increased demand for sample size before generalizing about a channel’s possible effect.
We conducted the same test for several advertisers and measured the opposite result. If an advertiser is doubtful about the incremental effect of their search investments, we suggest doing their own experiments.
Read the full article here.
