Mobile Dev Memo Podcast
Season 4, Episode 3: What is advertising incrementality? (with Garrett Johnson)
Sep 17, 2024
Garrett Johnson, an Associate Professor of Marketing at Boston University's Questrom School of Business, dives into advertising incrementality. He explains how marketing teams can measure the true impact of their ads and whether that impact is genuinely knowable. The intriguing concept of Ghost Ads is introduced, showcasing how they automate experiments and improve understanding of ad effectiveness. Johnson also discusses the commercial risks of ignoring incrementality, emphasizing the need for rigorous measurement in today's complex advertising landscape.
40:46
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Quick takeaways
- Advertising incrementality measures the actual causal impact of advertising on sales, highlighting the need for accurate metrics in marketing strategies.
- Ghost ads provide a solution for improving incrementality measurement accuracy by simulating ad exposure without facing traditional experimental challenges.
Deep dives
Understanding Incrementality
Incrementality refers to the causal effect that advertising has on sales or other key metrics, distinguishing between purchases made due to advertising and those that would occur regardless. The core idea is that consumers often buy from advertisers even when they are not exposed to advertisements, which leads to a need for measuring the additional sales driven by ads. For instance, specific research indicates that only about 10% of sales attributed to retargeted advertising are truly incremental, challenging the notion that all sales linked to advertising are a direct result of that advertising. This measurement is crucial for marketers as it ensures that businesses assess the real value created through their advertising efforts.
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