This post is an installment of our partnership series where we invite our esteemed partners to write about trending topics and industry news that impacts our mutual clients.
As a marketer, if you haven’t yet had an ugly ROI conversation, consider yourself lucky. The ugly ROI meeting is when your boss wants you, a marketer, to actually prove “your sales” i.e. the sales that you directly helped bring in. At an ugly ROI meeting you end up defending the importance of all your stats that aren’t sales and your boss scoffs, not understanding how ALL of it correlates to sales. The reason it is so difficult to discuss sales and marketing in the same sentence with the boss is because we know it’s a trap. As soon as you go down the ROI road, you will never find your way back.
I am familiar with this scenario, having gone through it several times throughout my 19 years as a marketing professional. I have worked as the boot-strapping-no-budget-guerilla-marketer all the way up to the multimillion-dollar-ad-campaign-manager with great success. I am now lucky enough to be running a successful micro-influencer marketing agency, ApexDrop, but still cannot count the number of times I’ve had to educate marketers on the dangers of putting marketing and sales into the same ROI bucket.
As an industry insider, I’ve become aware of three major marketing myths that lead to much more than ugly ROI meetings. One of these myths has caused millions of dollars to be wasted each year on useless ads and YOU might be a victim. Keep reading and I’ll outline the three myths, their origins, and how you can avoid being a victim of the biggest scandal going on in advertising today.
Myth #1: Know Every Source
The “know every source” myth is the belief that knowing the source of every sale will help your business.
This myth was popularized in the late 90s and early 2000s when brands saw for the first time that the internet allowed them to track nearly everything. The internet seemed like a miracle that destroyed the notion that “half the money I spend on advertising is working, but I don’t know which half.”
The Harsh Reality: Proving the source of every sale can negatively affect your business.
For example, when my agency first started working with Instagram micro-influencers years ago, there was a strong demand for the ability to track every click and sale that came from micro-influencers’ posts. At first it seemed like a no-brainer to use promo codes and tracking links in influencer bios to source sales back to Instagram, but we quickly figured out that tracking links completely ruins the authenticity of micro-influencer posts. The truth is, when you remove authenticity, these posts tend to become inauthentic sales pitches that aren’t really worth the sales they muster.
There are many more examples of how this marketing myth of “knowing the source of each sale” can be dangerous. To overcome this myth, brands must ditch old mantras in marketing such as, “If you can’t measure it, you can’t prove it.” They must realize that not everything is measurable or black and white. When measuring sales, brands should take them with a grain of salt, since nearly every sale is affected by several sources.
Myth #2: Pay Marketers for Sales
The “pay marketers for sales” myth is the belief that marketing teams should be accountable and paid for immediate sales.
This myth took stride in the 2000’s, just about the time when brands saw that affiliate marketing efforts or search engine marketing (SEM) specialists could trace specific actions online back to sales. This caused brands to lean towards short-sighted marketing efforts over a long-term branding because the former could produce positive ROI reports and the latter could not.
The Harsh Reality: When marketers feel immediate sales pressure, they become consumed with proving what they do is working, instead of doing things that work.
Today, marketers specialize in Google Adwords, clickbait articles, pixel tracking, promo codes, tracking links, contests, and pop-up coupons, just to name a few. Long-term marketing methods like branding, social media marketing, content marketing, influencer marketing, and PR are taking a back seat because marketers don’t want to risk losing status or their job for long-term growth that is not easily measured.
To overcome this myth, it must be understood that great brands are not built overnight, and that successful brands use a mix of short-term and long-term marketing efforts.
Myth #3: No Such Thing as Bad ROI
The “no such thing as bad ROI” myth is the belief that when some action shows a return on investment (ROI), then this is good for business.
This myth started when ROI was invented. Making money is almost always a positive thing for a brand. But when marketers and agencies had to start proving “their sales” in the 2000s, agencies, PR firms, and SEM specialists got desperate and accidentally invented what I call ‘False Positive ROI,’ and this ended up causing quite the scandal I’ll reveal to you shortly.
The Harsh Reality: You may be paying someone for False Positive ROI, which is really bad ROI.
One of the most blatant False Positive ROI scandals I’ve witnessed is when ad firms and SEM specialists convince their clients to Bid-On-Your-Own-Brand-Name on search engines. Before you freak out because you employ this tactic, please realize that there are many legitimate reasons to do this. However, there is a massive conflict of interest for an agency to have you bid on your own brand name and can help a mediocre agency take more money from you than they deserve.
The most legitimate reason your agency wants you to bid on your own brand name is to act as insurance against competitors bidding on your brand name. However, if you are bidding on your own brand name and your competitors aren’t, the last thing you need to worry about is saving a few bucks. The real problem is that you are likely giving your agency or marketer credit for sales they didn’t earn, and marketers have a clear conflict of interest to have you spend more on Google AdWords if they can take credit for sales or clicks.
Luckily, this is a serious problem with an extremely simple fix, and I’ve created a simple step-by-step guide to help. Just shoot a quick email to email@example.com with the word “GUIDE” in the subject line and I’ll send you a copy.
In summary, by understanding these marketing myths, their origins, and how to handle them, my hope is to inspire companies to stop sourcing every sale, paying marketers for sales, and avoid marketing scandals altogether. By spreading awareness, marketers can crush these myths together and get back to what we do best… growing our brands.
About ApexDrop: Are you an advertiser sending product samples to influencers but struggle to see ROI? Stop wasting time and money on so-called “influencers” and elevate your brand today with an ApexDrop micro-influencer subscription. For a simple monthly fee, subscribers receive hundreds of micro-influencers producing license-free content on Instagram all year in exchange for product samples.