The Future of Market Mix Modelling
At the start of the year it is often a good idea to get out the crystal ball and think about what next. Here we take a look at the three factors that will impact the future of Market Mix Modelling.
Still the best way to measure the long-term impact
This is an area that sets Market Mix Modelling apart from many different types of marketing analysis. It is imperative to capture this because a large proportion of marketing activity does not payback in the short-term. Therefore, it is only when the long-term impact of media is taken in to account that the total effect of media spend can be shown.
One of the most mentioned criticisms of Market Mix Modelling that some observers have argued, is that it isn’t possible to measure the long-term impact of marketing activity. In Brightblue’s opinion measurement of the long-term is a data problem and not a measurement problem.
As such, it is imperative to set up the methodology in the best way to capture this accurately:
- Ensuring the time period you are looking at, is in line with the impact you are measuring. Establishing the true long-term effect of advertising may require going back further than the 3-5 years of a typical Market Mix Modelling model, especially for large brands
- For some brands the long-term memory effect can be used to capture the direct effect
- Tracking the indirect effect on impacting the baseline through wider data sources such as brand health
Speeding up the Future
Firstly, marketing departments demand fast results in order to have the ability to dynamically adjust media laydown for the best use of marketing budgets.
Secondly, an increase in computing power has allowed for quicker analysis to take place. This allows for a very fast turnaround between receiving raw data and the measurement of media performance. This increase in technology makes it possible for Brightblue clients to view the results of Market Mix Modelling projects in an almost real-time fashion.
This speed allows marketers to compare the impact of all marketing channels, on a comparable basis, with time to make changes.
Data availability provides detailed outputs
Organisations that Brightblue work with, have become more aware of the importance of collecting data and the in-depth analysis that is possible when using this data. Due to this availability of data, it is now common to measure at the most granular level possible. For example, a retail store may choose to carry out analysis at a store level as opposed to at a national level because of the greater level of insight available.
With more detailed data it is also possible to carry out different types of analysis. This allows companies to compare what drives their KPI across:
- Delve deeper into the impacts of marketing channels (PPC terms, TV Stations, Digital buys)
- Different sections of their client base e.g. demographic, geographic etc.
Screenshot of our REACT Real Time Dashboard, showing an Overview of your marketing ROI:
Brightblue Consulting are a London based consultancy which help businesses drive incremental profit from their data. We provide predictive analytics that enable clients to make informed decisions based on data and industry knowledge. Through Market Mix Modelling, a strand of Econometrics, Brightblue has a proven track record showing a 30% improvement in marketing Return on Investment for clients’ spend. If you are interested to find out more please contact us through email by clicking here and one of our consultants will get back to you shortly.