“It’s Amazon.” That was Sir Martin Sorrell’s answer to the question, “What keeps you up at night?” (O’Reilly, 2017). Not Google or Facebook, but the new kid on the advertising block. The former WPP chief executive officer even predicted that Amazon’s advertising budget one day would reach $100 billion—rivaling other walled gardens (Weissbrot, 2018).
Advertising professionals often are reminded that advertising dollars follow eyeballs. Although this is true over the long run, shifts in marketing budgets do lag the evolution of media consumption. Dollars do not reallocate themselves magically according to engagement. Inertia is a powerful force, and budgets need an impetus to act.
In the digital era, that impetus—more than anything else—has been measurement.
Over the past 20 years—largely because of the forces of measurement—spending on U.S. digital advertising has soared to $108 billion, and it is forecast to grow another 19 percent in 2019 (eMarketer, 2019). Google introduced digital marketers to this lesson in the early days of paid search. Weighing the cost of a paid search impression against the e-commerce sales it generated put return on investment (ROI) in black-and-white terms. It also made it clearer when to lever up advertising spending.