Pi in the Face: Why I (love and) despise ROI
Ian Lurie Mar 14 2017
This is the first edition of our annual Pi in the Face column. May many follow.
Note: If you’re a marketer, this post will frustrate the hell out of you. I apologize. I needed a good rant. Plus, at a conference last week I heard a speaker say, “If it doesn’t generate ROI, we don’t do it.” I’ve been screaming in my head ever since. With any luck, this post will help, and I can cut back on my meds.
Oh, ROI. I love you. I hate you. I put you on a pedestal. I want to jam you under the front right tire of my car. I want to rub your tummy. I want to put you in the microwave.
So yeah. I have a love-hate relationship with ROI. Here it is:
ROI is Nifty
ROI is like search rankings and media mentions. We love to talk about them when it makes us look good.
It’s also a great measure of success. If a marketing tactic generates a positive ROI, you keep doing it. Assuming that tactic doesn’t involve maiming puppies or pouring toxic waste into swimming pools.
Increase ROI, and you can write a case study. Then you can submit that case study for awards.
Most important, it makes our clients look good. We all have an executive team, a boss, or investors breathing down their neck. They whisper “I just got 400 resumes” and “I read about this new tactic in a magazine.”
Nothing puts the executive team at ease like positive ROI.
ROI is the Bane of Marketing
ROI is like that story your friend tells about 13 raccoons in the kitchen. You love hearing about it the first 10 or 20 times. After that, you want to ram pencils in your ears.
I have to qualify all this: When I hear “ROI,” I assume “directly measurable ROI.” All good marketing has a return on investment. But you can’t measure the ROI of a great YouTube series, a mind-blowing app or some other bit of creative amazingness.
You can’t just do the stuff you know generates a good return on investment because you miss the stuff that can generate a great return on investment.
You’ll never be able to accurately calculate the performance of that one, incredible piece of content. You can’t compute the ROI of a customer service Twitter account supported by great employees. You can’t track the ROI of that person on the corner flipping a sign around that says “buy now.” How about “influencer marketing?” Think you can 100% measure that?
Now and then you need to feed ROI into the shredder and just try something. Go with your gut. Otherwise, ROI will slowly kill your marketing.
We all love return on investment. We all hug our ROI. It’s perfectly normal.
But please, PLEASE DO SOMETHING CREATIVE. Once in a while. Don’t settle for the day-in-day-out 2:1 return. Shoot for 1000:1 with something that’s not guaranteed.
That’s called “marketing.”
CEO & Founder
Ian Lurie is CEO and founder of Portent. He's recorded training for Lynda.com, writes regularly for the Portent Blog and has been published on AllThingsD, Forbes.com and TechCrunch. Ian speaks at conferences around the world, including SearchLove, MozCon, SIC and ad:Tech. Follow him on Twitter at portentint. He also just published a book about strategy for services businesses: One Trick Ponies Get Shot, available on Kindle. Read More