Doom loops
Doom loops are where businesses get stuck in a myopic view of their data such that they lose the woods from the trees.
This can have profound effects. Nike were the canary in the coal mine for this, they shifted too much into performance, without continuing to invest in the brand.
By zooming in too far on attribution and without thinking about how advertising activity is expanding the market that a brand plays in.
Pete Buckley highlighted how it plays out:
Finance tighten attribution targets (e.g. COS or ROAS).
Marketing focuses on easier conversions.
Meaning you spend more on existing sales.
Attribution metrics improve.
But growth stagnates, so finance tightens attribution targets.
Why? Because you’re capturing easy sales vs creating net new demand. The solution? WARCS Multiplier effect, which "argues that the strongest returns from advertising come from using brand equity as an accelerant for commercial performance.” And metrics wise, shift the focus from absolute performance, to incremental performance in channels.
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Dig deeper
Pete Buckleys post.
Origin of the Doom Loop.
WARC on the Multiplier Effect.
Dan Wilson on breaking the loop.
Nike performance vs brand.
Nike: An epic sage of value destruction. And the cautionary tale of Nike.
Play Doom online.
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