“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Max Mead, CEO at Acceleration Labs.
You were probably expecting to read about why you should boycott politically oriented media properties or remove controversial political intonations from your brand’s messaging.
This column is actually about improving your marketing ROI and, just as important, building a culture within your marketing team that’s driven by data and insights instead of organizational politics. For anyone who wanted to read about the other kind of politics, stick around, especially if you’re a consumer marketer, because there’s revolution coming that you’ll want to know about, too.
Even companies that have aspired to have a data-driven culture have had difficulty achieving it. Why? For starters, they just haven’t had the tools to make it truly possible.
Media-mix modeling (MMM), the cross-channel marketer’s go-to planning tool – consider it the conservative incumbent – has its merits, including its ability to measure all channels. It also has some support for experimental design so you can tell what’s driving real lift. But MMM has major shortfalls, including being way too slow to enable in-flight optimizations – it requires years’ worth of data and can take months to get results. It’s also not detailed enough to inform anything other than top-level channel budget allocations.
Then there’s digital attribution – the new establishment. Digital attribution gives more detailed insights, but it only covers digital, and most models have fundamental design flaws that make them easy to game. Even they are cumbersome and too slow.
As such, most companies use both approaches and try to reconcile them. But they rarely cross the aisle effectively – the two models never agree, resulting in subjective decisions about how to spend precious marketing dollars between digital and nondigital channels. That’s where politics take over. Attribution gridlock.
As Larry Gamache from Carfax puts it, “Unless everyone’s budgets are going up, someone will be unhappy. You’ll end up with decision-making that’s guided by politics or whomever has the loudest voice in the room.”
Now that digital is as big and important a channel as TV, this is no longer a trivial problem.
But the future of attribution is here – a liberation, enabling data-driven cultures to finally bloom and thrive. Forrester describes a new category of measurement that it labels “unified measurement,” which ties these two previously separate approaches together. Gartner has a similar concept it calls “total marketing measurement,” which includes all marketing touch points, not just media, such as customer service interactions.
The companies in these emerging categories have different approaches, but the concept generally involves establishing a person-level graph that captures cross-channel media exposure, then backfills with something that resembles MMM to round out the edges. Benefits include more granular and faster insights that become actionable in-flight, which is where a large portion of the payoff resides. Some vendors enrich the models with additional external data to bring even more signal, and may even begin to address the relationship between branding and sales.
The implications are vast.
First, with a singular lift-based model that everyone can agree is fair, there’s higher voter turnout and no more subjective fighting over budget using different data sources. Channel-specific teams can shift focus to optimizing within their channels on a level playing field and finding synergies with other channels.
Second, with faster and more granular insights, the concept of attribution and optimization come together, and analytics and media buying functions begin to merge as they have started to in some organizations. Longer-term, marketing teams may reorganize in pods around audiences rather than channels.
Not only can culture within marketing teams improve, but the marketing team’s relationship with the finance team will improve, too, like a new data-driven alignment between branches of government. How many marketing teams can say that their CFO believes he or she has a handle on marketing ROI today?
If you’re a marketer interested in this new category, you’ll need to be discerning, as there’s still some selling ahead of its time happening by the vendors in the space. Fact-check your candidates to make sure that people in your organization – especially skeptics – can trust you to guide them through the process.
Whatever your previous attribution affiliation, there’s a massive opportunity available to the early movers who’ve aspired to have data and analytics drive decision-making – and to those who have the vision and wherewithal to bring their organizations along for this journey to marketing-ROI freedom.