The AdWords Illusion: Forget the sales funnel

I’ve written before about the problem with using “last-click attribution” as a key metric for deciding where and how to place your advertising.

Who gets credit for driving customers? The last thing they visited.

Many marketers are just counting the click and forgetting about all the other marketing it took to get that click.

Why would they click on, call, or visit your business over the other 10 listings in Google? Because they already know you. Maybe they’ve seen your trucks, your building, know your reputation, or seen your advertising. In other words, building your brand is what made the conversion when they needed you. If you wait until they need you before getting your name in their head, you’re no more likely to get the call than the next guy. And you’d better hope the next guy isn’t outspending you on keywords.

Tim Mayer on Search Engine Land posted about the “AdWords Illusion,” in much the same way. AdWords gets credit for the conversion, but it’s a combination of marketing that occurred before that click that led consumers to click.

To grow a healthy sales pipeline, it is essential for marketers to work the top of the funnel and spur introduction to the brand. This is how wise marketers feed volume to the bottom of the funnel, where the conversion events happen. — Tim Mayer in Search Engine Land

Here’s how I laid out my case along the same lines earlier this month in a post titled: What really drove the sale: When Metrics Lie. Here’s a short excerpt:

A study out by AdRoll emphasizes just this point when they say that Last Click Measurement doesn’t tell the whole story. Follow their logic trail:

Only 16% of all internet users click on ads. Of those, half account for 85% of all clicks on display ads. Let that sink in for a minute. The ads you place on-line only get clicked on by a small number of people seeing them. That means basing your success on that last click means you aren’t tracking the vast majority of people seeing your content. Depending on this last-click attribution means you are only tracking a small portion of your marketing funnel.
Last-click incentivizes users already likely to visit or purchase. That’s the so-called funnel jumpers. That’s great to move people quicker to commit, but it discounts people who are earlier in the funnel or in the awareness stage that you want as customers as well. Today’s browsers are tomorrow’s shoppers.
Last-click gives all the credit to the final-click and discounts any marketing that happened beforehand. Any brand building or awareness campaigns, or online presence designed to educate, inform, and push people through the purchase funnel is ignored. And yet it’s the “beforehand” marketing that makes the “now” marketing work.

We know this to be true from decades of studying consumer behavior. While the delivery mechanisms may be different, the behavior is still pretty much the same.

Almost nobody buys anything the first time see it — and the more expensive something is, the longer it takes to move them to purchase.