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Be Aware of Selection Effect – Focus on Incremental Effect

Be Aware of Selection Effect – Focus on Incremental Effect

This is a blog by Mark Verzijl, Consultant at Sciential.

The ever-important question within marketing communications is whether new leads (or sales) are the result of your advertising efforts or whether these leads would have been acquired either way. In other words, do you know to what extent your campaigns REALLY added value?

It is crucial for life science marketers to distinguish such a selection effect (people see your ad, but were already going to click, buy, register, or download) from the advertising effect (people see your ad, and that’s why they start clicking, buying, registering, downloading). One of the most famous quotes in marketing stems from John Wanamaker in the 1910s, who said that half of the money he spends on advertising is wasted, the trouble was that he did not know which half. And although we came a long way in digital measurement, his quote still holds some truth.

The marketing machines and algorithms are developed in a way that they optimize for the selection effect. Think about it, algorithms optimize for an objective, for instance, prospects that are most likely to convert. And what group is that? Presumably, retargeting groups, lookalike audiences and other high-intent groups. By no means I am saying that life science marketers should not use these audiences but they should be aware of the possible selection effect when analyzing data and performance.

This brings me to my actual tip: become a lift-driven marketer, measure incrementality always-on and also test broader (and out of the box) targeting audiences. The latter might not result in the same cost-per-lead as e.g., lookalike groups, but you most likely have incremental leads – leads that you otherwise would not have generated. Always keep searching for added value and impact!

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