Home Research ARF Forum: Marketers Weigh Impact Of Marketing Mix Modeling

ARF Forum: Marketers Weigh Impact Of Marketing Mix Modeling

SHARE:

ARFartAt the Advertising Research Foundation’s Industry Leader Forum yesterday in New York, one point of contention was around marketing mix modeling.

Marketing mix modeling is “a core part of our decision-making,” remarked Patrick McGraw, director of consumer and market at P&G, during a panel about measuring marketing effectiveness. “It helps us develop a better understanding of what’s happening, what isn’t and deliver better value to consumers and better shareholder return.”

But, according to McGraw, something’s missing. On the one hand, there has been a surplus of talk about data integration, but few answers to “how we bring analytics together that builds on the backbone of our marketing mix model.”

Another area for improvement, he said, is taking a “total, comprehensive business” look at the marketing mix model. “Much of the focus has been on media and advertising, but [we need to look at] how we drive business growth overall and pull all the levers in our mix.”

At ESPN, the “longitudinal” aspects of data and modeling – “being a historian and determining results year-over-year” — are important, said Julie Perlish, senior director of advertiser insights.

For General Mills, marketing mix modeling provides a “common framework” across marketing, finance and operations, according to John Walthour, director of global consumer insights for General Mills. His team, going by unit-name Business Driver Analytics, is responsible for measuring the direct interactions between paid, earned and owned media at the brand level, as well as the organizational level.

Panelists fielded a question about the biggest challenge for marketing mix modeling, with one audience member citing the CFO and overall accountability if the mix model is unable to prove out or otherwise properly attribute data outcomes.

“Finance,” responded McGraw, “is a critical partner for us. Sometimes, the results seem different from what we might have anticipated.”

As Pat LaPointe, EVP of MarketShare Partners, later pointed out, there is no such thing as “a model” anymore.

Marketers need to look at broader market factors like mergers and acquisitions, short-term revenue vs. long-term brand effects and the customer lifecycle in its entirety. “We’re building a whole bunch of little models that talk to one another,” LaPointe said. “But any time we try to build [data] optimization models [on a] large number of variables, we need the horsepower” that advanced analytics and technology bring.

At one point, the panel digressed into a quasi-debate about the correlation component of marketing mix modeling vs. causality; an audience member called out that critics of the marketing mix model are, inherently, stakeholders that could potentially take a budget hit if attribution/mix models dictate that action, should they claim that statistical regression is flawed.

“I think the key to having success is being closely aligned and integrated with the business teams, which is true not just with marketing mix modeling, but any analytics,” Walthour remarked. Thus, keeping revenue management, finance and operations included in the marketing conversation, could make for more effective execution.

Must Read

shopping cart

Moloco Invests In Its Competitor Topsort As The Retail Media Stakes Go Up

Topsort can lean into Moloco’s algorithmic personalization, while Moloco benefits from Topsort’s footprint with local retailers in the US and in Latin America.

CDP BlueConic Acquires First-Party Data Collection Startup Jebbit

On Wednesday, customer data platform BlueConic bought Jebbit, which creates quizzes, surveys and other interactive online plugs for collecting data from customers.

Comic: The Showdown (Google vs. DOJ)

The DOJ’s Witness List For The Google Antitrust Trial Is A Who’s Who Of Advertising

The DOJ published the witness list for its upcoming antitrust trial against Google, and it reads like the online advertising industry’s answer to the Social Register.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters

Why Vodafone Is Giving Out Grades For Its Creative

One way to get a handle on your brand creative is to, well, grade your homework, according to Anne Stilling, Vodafone’s global director of brands and media.

Inside The Fall Of Oracle’s Advertising Business

By now, the industry is well aware that Oracle, once the most prominent advertising data seller in market, will shut down its advertising division. What’s behind the ignominious end of Oracle Advertising?

Forget about asking for permission to collect cookies. Google will have to ask for permission to not collect them.

Criteo: The Privacy Sandbox Is NOT Ready Yet, But Could Be If Google Makes Certain Changes Soon

If Google were to shut off third-party cookies today and implement the current version of the Privacy Sandbox, publishers would see their ad revenue on Chrome tank by around 60% on average.