Marketing economics in practice.

Shoppers are asking ChatGPT what to buy. Here is how AI assistants pick which products to recommend, and what e-commerce stores need to do to be selectable.

The campaign ran. Sales went up. The report says the campaign drove the sales. It doesn't. It shows they happened at the same time. The difference between correlation and causation is the difference between a budget decision and a guess.

A marketing specialist manages campaigns within channels. A marketing economist assesses whether the acquisition model is commercially viable. These are not the same job. Most businesses are only staffing one of them.

A blended ROAS of 4.2x sounds healthy. It is also hiding a campaign at 9x and a campaign at 1.1x. Budget follows the average. The 1.1x grows proportionally with the 9x. The average looks stable. The economics deteriorate.

A ROAS target calculated without reference to your actual gross margin is not a performance benchmark. It is a number that feels like one. The calculation is straightforward. Almost nobody runs it.

The question behind the question is whether the analysis pays for itself. It almost always does, because the thing being diagnosed is a budget that is already being spent.

A marketing economist connects marketing activity to commercial outcomes using the tools of economic analysis. Most businesses have the campaigns covered. Nobody covers the economics.

Price communicates quality before a customer evaluates your product. Most businesses treat pricing as margin math. It is also trust architecture.

847 search terms triggered the ads. 12 converted. The other 835 spent $4,200 with nothing to show for it. This is what Google Ads waste actually looks like.

Your Google Ads report shows impressions, clicks, and CTR. It's missing the one number that tells you whether the campaign is actually working: conversion rate.

Ask your agency what your current cost per conversion is. How fast they answer reveals more about your account management than any report they've sent you.

The problem isn't your budget. It's what happens after the click. Improving conversion rate from 1% to 3% triples leads from the same Google Ads spend.

Google Ads captures demand. It doesn't create it. If nobody is searching for your product, paid search can't help. Here's how to check before spending more.

Most campaigns look profitable because of how attribution is measured, not because they actually drove the sale. Incrementality testing reveals what your ads are genuinely contributing versus what would have happened anyway.