Adidas Reveals Surprising Finding: Traditional, Not Digital Ads Driving E-Commerce Sales
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The explosive growth of digital advertising over the past decade can be credited — at least in part — to how measurable the channel makes campaigns.
But these metrics can sometimes distract brands from what’s really driving customer behavior, according to Adidas’ global media director Simon Peel, who gave a presentation Tuesday at EffWeek, a London marketing conference.
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The ability to “look at short-term measurements in real time” encouraged Adidas to become “overly focused on digital attribution,” he said, according to Campaign. Like many companies, it invested heavily in channels that seemed to be paying off in terms of last click attribution, such as paid search.
About two years ago, though, a Google AdWords error prevented the company from being able to buy keywords for two days. Despite this, it didn’t see traffic or revenue plummet. Then, the same thing happened again six months later, lasting for a week. “Again, we were chasing and investing in a particular channel to drive ROI, but it was sales we were going to get anyway,” said Peel.
At the time, Adidas was spending a much smaller share of its budget on brand advertising — which builds an emotional connection with consumers over time but can’t be easily tracked. By improving its analytics tools, it has since come to better understand the effectiveness of traditional advertising channels such as television and billboards. Looking at this modeling, he said, “It’s telling you that you should be investing in video — which doesn’t do very well in last click attribution — that you should be investing in TV, that out-of-home and cinema is driving e-commerce sales.”
Global digital ad spending is expected to reach $333.25 billion in 2019, according to the research firm eMarketer, and this year marks the first time that digital will account for about half of the total market. With so much of consumers’ media consumption now occurring on phones and computers, it’s understandable that marketers want to meet them where they are. But as Adidas illustrates, it’s also important for brands to also think about what’s going to keep them coming back in the long-term.
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