When Did the Future Stop Counting?

Most media buyers would recognize the absurdity immediately, and might nevertheless spend Friday afternoon preparing a budget recommendation which does something remarkably similar.

For that buyer, and the marketing leader who must defend the recommendation, the dilemma is this: how do you divide the next dollar between capturing existing demand and developing new customers, when the evidence accepted at the budget meeting favors the results which arrive fastest?

Sophisticated buyers generally know better than to believe in last-touch attribution, but the operating arrangements of the business can reward it long after everyone in the room has disavowed it. A weekly report is required; an acquisition target must be met; each channel must demonstrate its own return. Together, these reasonable requirements can encourage us to harvest the effects of earlier advertising without adequately accounting for the cost of replacing them.

Imagine being asked to shift money from broader-reach video into search and retargeting because the latter reports a lower acquisition cost. You suspect that some of those acquisitions depend on preferences developed elsewhere in the plan, but cannot quantify that contribution on the same timetable or with the same apparent precision. How do you defend the allocation without asking the client to accept a matter of faith?

Call the underlying tendency the Now Bias: an organizational preference for effects which become legible soon enough to influence the next decision. The future is not denied; it is invited to return when it has a receipt.

Even an incrementality test can answer a question narrower than the one confronting the buyer, if its observation period captures an immediate response but not subsequent purchasing, or its headline result combines existing customers with the new customers the business needs to attract.

This is why I would put new-customer growth near the center of the allocation discussion, rather than leaving it as an interesting supplementary statistic after the overall ROAS number has settled the argument. A plan can become increasingly efficient at reaching familiar customers without expanding the population of buyers, and for a while the attractive return can make that distinction less conspicuous.

The useful question is whether an investment produces additional new customers, at an economically sensible cost, and whether their subsequent behavior supports the value assigned to acquiring them. Not every purchase labeled “new-to-brand” was caused by the advertising; some people would have become customers anyway. We need a credible comparison, and an agreed definition of “new,” including the purchase-history window and the limits of the available data.

Retention remains valuable, but its contribution should be distinguishable from acquisition before we decide which activity deserves the next dollar. Nor should we infer the effect from a budget labeled “brand” or “performance”: a video exposure can help produce a purchase now and strengthen a preference for later, while a search advertisement can introduce an unfamiliar brand. The consumer’s response is not obliged to conform to our departmental organization.

The answer is neither to abandon accountability nor simply to become more patient. It is to make allocation decisions using evidence of incremental business contribution, observation periods appropriate to the purchasing process, and new-customer growth, rather than principally the speed or volume of attributed conversions.

Buyer and client should agree before the campaign begins on what evidence would justify self: does moving money improve the results of the whole plan, rather than merely improve the report for one channel?

Intermediate reviews should be distinguished from final judgments, with enough time allowed to observe the category’s purchasing cycle. Where longer-term value remains uncertain, that uncertainty should be visible rather than replaced by either an optimistic lifetime-value assumption or the equally convenient assumption that everything beyond the reporting window is worth nothing.

My own work at RMTLabs makes me especially interested in how motivational alignment can help attract new customers, and I am hardly a neutral observer. But our work should face the same test as anyone else’s: does it bring additional people into the brand, beyond what the comparison would have produced, and do the economics justify the investment? An explanation of why something should work is the beginning of the inquiry, not its conclusion.

There is nothing particularly visionary about believing in the future. The more consequential achievement is arranging the present so that a buyer can invest in it without being penalized for failing to produce all of its benefits by Friday, while still being required to demonstrate that those benefits eventually arrive.

We should certainly inspect the garden, compare methods, account for the water, and investigate plants which are not growing. We should also allow the people responsible for the harvest to distinguish a failing crop from one which our own evaluation procedure has prevented from bearing fruit.

Posted at MediaVillage through the Thought Leadership self-publishing platform.

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The opinions expressed here are the author's views and do not necessarily represent the views of MediaVillage.org/MyersBizNet.