We’re in the thick of an ever-changing digital media landscape. In a post iOS 14 world, marketing is evolving every single day, and with this evolution comes a growing need for businesses to remain adaptable, and up-to-date on the newest trends and metrics.
Here at Slicedbread, we’ve combated the loss of performance due to tracking limitations caused by iOS 14, by moving almost entirely away from in-channel ROAS (return on ad spend) reporting, and focusing on more stable methods.
We know that everyone loves their ROAS, but we’ve uncovered some ways to review and optimize marketing campaigns that are significantly less impacted by changes in ad channel attribution and tracking - methods that will allow you to look at your results within channels in a new light. Keep reading to learn more.
Focusing on MER (Marketing Efficiency Ratio)
Let’s be honest: the adoption of iOS 14.5 was forced upon all of us, and we can’t deny that there was a huge loss of visibility. We saw major losses in platform ROAS - with Facebook dropping 20 - 30% and Google about 10% of tracking capabilities, respectively.
In addition to these base challenges that came with the iOS 14.5 update, different platforms run on different algorithms and attribution windows, making it even more difficult to have consistent ROAS from month to month. These days, it’s not abnormal for businesses to notice declines in performance due to unpredictable changes within certain platforms.
So what’s the fix? One alternative way that Slicedbread has found to evaluate data across ecommerce verticals, is to focus less on ROAS, and more on MER (marketing efficiency ratio). Marketing efficiency ratio refers to the total ad spend divided by total website revenue.
By making the shift from ROAS to MER, we get to analyze metrics that focus on the bigger picture. Tracking MER metrics allows for a different perspective, and can offer a better client understanding and more consistent results.
Will ROAS ever go back to “normal”?
While most of our clients have gotten used to seeing a lowered ROAS over the past year, we still get the sense that some have a fleeting hope that in-channel ROAS will return to prior levels.
Here’s our two cents: ROAS is a metric that we already know to be flawed - we know this because platforms can embellish ROAS results based on different variables such as attribution windows and how the platform itself is built.
And in the ever-changing marketing world that we’re currently in, we believe that this type of “micro focus” on ROAS - a metric that we know to be incomplete - can lead to a lack of focus on topline revenue growth, and actual profitability for e-commerce sites.
The sooner we can acknowledge and accept the fact that in-channel ROAS will never be the same in a post iOS 14 world, the sooner we can focus on what really matters: prospecting and a new customer acquisition.
Each business is unique, and what leads to success will vary from brand to brand. But one thing we know on a universal level, is that focusing on MER can drive long-term growth and brand stability, while focusing too much on ROAS can cause overspend and oversaturation.
We understand how scary it can be to shift out of old habits that have proven successful in the past. But in our current landscape, where shopping behaviors and platforms are changing every single day, it’s important to venture out of what’s comfortable, and into the future. Have no fear, Slicedbread is here to guide you every step of the way!