Does the rule of “50% of media spend is wasted” still work?

By Søren Fromberg on in MMM

For more than a decade, the phrase “Half the money I spend on advertising is wasted” has been a common refrain in the marketing world. It was first spoken by John Wanamaker, an American merchant and marketing pioneer, who struggled with the challenge of measuring the effectiveness of his advertising efforts. Despite the many advancements in technology and data analytics over the years, this challenge remains a prevalent issue for businesses today.

The rule of “50% of media spend is wasted” indicates that approximately half of a company’s marketing budget is being allocated to ineffective channels or campaigns. However, with the increasing complexity of modern marketing and the fragmentation of media channels, this estimate may not be accurate for all businesses.

The rise of digital marketing has brought new challenges to measuring the effectiveness of marketing spend. The abundance of data generated by digital channels can be overwhelming, and it can be difficult to discern which metrics are relevant for your business and goals. The complexity of digital marketing also means that companies need to allocate their budgets across a wide range of channels, including social media, search engines, email marketing, and display advertising. Without effective measurement techniques, it will easily end up with a to misallocation of your media budgets and result in wasted spend.

Despite these challenges, measuring marketing activities is still crucial for companies. In today’s highly competitive landscape, as a company, you need to maximize the effectiveness of every dollar  spend on marketing. By implementing robust measurement techniques, companies can identify the most effective channels and campaigns, while allowing them to optimize their budgets and achieve better results.

One key to effective measurement is setting clear goals and KPIs (key performance indicators) that are aligned with the overall company objectives. This enables the opportunity to measure the success of the marketing efforts and supports making informed decisions about where to allocate media budgets. Companies can also use advanced data analytics tools to track the customer journey across multiple channels, gaining insights on how each touchpoint contributes to the overall customer experience.


In conclusion, while the rule of ”50% of media spend being wasted” may not be accurate for all companies, measuring marketing activities is still a critical aspect of achieving success in the existing competitive environment. By implementing effective measurement techniques, and using advanced data analytics tools, companies can optimize their marketing spend, identify the most effective channels and campaigns, and ultimately drive better results. As Wanamaker himself once said, “The person who stops advertising to save money, is like the person who stops the clock to save time.”

Based on the importance of measuring marketing activities highlighted in the article, here are 3 initiatives that your company can take to optimize the allocation of media budgets:

  • Set clear goals and KPIs:

Identify business objectives and set specific, measurable, and achievable goals for your marketing campaigns. You should also establish KPIs to measure the success of the marketing efforts and ensure they align with your overall objectives.

  • Invest in data analytics:

To effectively measure marketing activities, your need to invest in advanced data analytics tools. These tools can help your business to track the customer journey, identify trends, and gain insights about which channels and campaigns are driving the most ROI.

  • Regularly review marketing strategies:

Your Review the company   marketing strategies regularly to identify what is working and what is not. This can help making data-driven decisions about where to allocate your budgets and optimize the marketing spend.

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