Opinion

The cobra effect is poisoning digital marketing

Richard Shotton uses the tale of Delhi's cobra bounty as a warning against setting ill-thought-out digital marketing targets.

Of all the decisions made by the colonial governor in Delhi, offering a bounty for dead cobras was one of the worst.

It had seemed a sensible policy. After all, cobras were a deadly hazard that needed culling. But as the governor had limited manpower at his disposal, he needed others to conduct the cull. So, a small bounty was offered for every dead cobra handed in to the authorities.

Credit: Boris Smokrovic / Unsplash

The policy began well enough. Cobra corpses came in; rupees went out. The governor basked in his success.

And yet, the underlying problem of cobra bites continued.

The cobra effect

The problem was that the bounty was for killing cobras, not reducing bites. Therefore, enterprising, if unscrupulous, folk had begun breeding cobras so they could be killed and handed in.

From a safe distance this tale of unintended consequences seems farcical. Yet the “cobra effect”, as German economist Horst Siebert termed it, is far from a historic quirk. Similar examples have been recorded with rats in Vietnam, pigs in the USA and, most worrying for us, digital advertising.

What’s the cobra effect in digital advertising?

The key point about the cobra effect is that when you set a naïve target, it encourages behaviour that superficially meets that target, rather than the underlying goal.

The targets set on most digital activity measure short-term effects: immediate sales, visits, views. These short-term approaches are popular as they’re easy to measure. However, ease and appropriateness are different things. After all, we know that the majority of advertising’s effect is long-term.

Yet as it’s hard to measure the long-term, the tendency is to ignore it.

We’re like the drunk in the old joke: A policeman sees a drunk man searching for something under a streetlight and asks what the drunk has lost. He says he has lost his keys, and they both look under the streetlight together.

After a few minutes the policeman asks if he is sure he lost them here, and the drunk replies, no, and that he lost them in the park. The policeman asks why he is searching here, and the drunk replies, “this is where the light is.”

These naive targets have an insidious effect – our plans are optimised to the wrong metrics, thereby reducing the effectiveness.

What happened to the cobras?

When the Delhi governor discovered his folly he was distraught and ended the bounty. Unfortunately, that was his second mistake. The cobras became worthless and disgruntled snake-farmers let them loose, exacerbating the original problem.

Just as a knee-jerk reaction to the cobra effect caused more problems so would cancelling short-term targets. Instead we need better targets. Every plan should blend long-term metrics with short-term ones. Only then will we avoid the cobra effect.

Richard Shotton is deputy head of evidence at MG OMD and the author of The Choice Factory. This post was first published on WARC.

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