By: Yael Heffetz, Media Consultant, CvE & Jordan Kernahan, Practice Lead, Marketing Activation, CvE
Introduction
Digital marketing evolved soon after the internet was introduced to the commerce world. E-commerce followed quickly.
One of the best traits digital marketing always took pride in is its ability to measure precisely its effectiveness and impact. Terms like ROI, ROAS (RETURN ON AD SALES), CPA, ABV and others were standardized, allowing brands and marketers to align and optimize their marketing efforts with surgical precision (unlike traditional advertising on TV, radio and press).
But did it really? Have we ever really managed to measure digital marketing efforts precisely? Well, the truth is, discrepancies were born almost immediately. Gaps between measuring platforms, media buying platforms and internal BI systems were always present. But with that said, it usually gave a good directional indication to the best optimization points.
And while we were all rather comfortable with the level of data accuracy, someone decided that all this goodness needed to perish. With cookie deprecation, it is time to turn a page into the marketing measurement evolution.
This article reflects on how:
- MTA will soon be redundant due to its reliance on the cookie and inability to provide the accuracy it once did
- MMM & Lift testing will be the new normal, with the best proponents of media measurement working with both methodologies.
- Machine learning & AI will open the door to more powerful analysis with more dimensions and data-driven outcomes.
The Future of Measurement Techniques
Multi-Touch Attribution (MTA)
MTA attributes conversions or sales to multiple touchpoints along the customer journey, rather than assigning credit to a single touchpoint. When it was built, the desire was to create a model that provides a more accurate assessment of each touchpoint’s contribution. While the intention was pure and accurate, the implementation was lacking. As mentioned above, gaps between measuring platforms, media buying platforms and internal BI systems were always present. Somehow, we never managed to get all platforms to align and the quest for the holy grail of a single point of truth was never accomplished. And this happened before cookie deprecation.
These days, when all marketers and brands are preparing to transform the cookie-less future into the present, the future of MTA is starting to be very clear – it will most probably perish. Tracking users across multiple properties of the web will no longer be possible, and even accurate measurement on one property will be hard in a live environment without expensive user-matching platforms.
We believe businesses will choose to opt out of MTA, as without the accuracy it promised, which was not solid even with the associated cookies, its contribution will be taken with a pinch of salt, which would eventually make it redundant.
Media Mix Modelling (MMM)
MMM quantifies the impact of various marketing channels while factoring in sales or other key performance indicators (KPIs) using historical 1PD. It uses this data to determine the contribution of different marketing elements, such as advertising, promotions, pricing, and distribution, to overall business outcomes. As such and as it is not dependent on external sources of truth, it is considered robust and accurate.
Up until recently, MMM was perceived as an advanced methodology, used by industries with deep pockets allowing them to invest in teams that can manage and execute marketing operations utilizing MMM.
With the cookie deprecation, it seems like more and more businesses will be forced to shift their marketing operation and start using MMM, as other methods would not manage to provide a true evaluation of their marketing efforts.
Lift Testing
Lift testing is a statistical technique used to evaluate the effectiveness of marketing activities. The primary goal of lift testing is to measure the incremental impact of the marketing initiative on desired outcomes, such as sales, conversions, or customer engagement. One can always argue that organic growth would have happened without the support of marketing, lift testing takes that ambiguity away. While no one will argue that lift testing can quantify marketing effectiveness, it adds many complications to the marketing operation.
With the cookie deprecation, businesses will be forced to have internal analysts and marketing teams trained to have lift testing as second nature. It should, very quickly, become as easy as it is today to create a new campaign and start optimizing it. As if they won’t, they will find themselves in a situation where they cannot assess their marketing efforts properly.
But worry not, a future that utilizes AI and machine learning is our reality. Once combined, the power those two provide businesses is exactly what we all need to reach the next page of measurement evolution.
Evolution of Measurement Techniques
Integration of machine learning, AI (Artificial Intelligence), and predictive modelling in marketing measurement sits at the core of the measurement techniques transformation (did we say the combination of lift testing and MMM is a winning horse?).
This integration will revolutionize the way businesses understand and engage with their customers. By utilizing these advanced technologies, companies can analyze vast amounts of data to uncover valuable insights, predict customer behaviour, and optimize marketing strategies for better results (lift testing).
Machine learning algorithms can sift through massive datasets to identify patterns and trends that human analysts might overlook. Artificial intelligence enables marketers to personalize their campaigns based on individual preferences and behaviours, leading to more targeted and effective messaging. Predictive modelling allows businesses to forecast future trends and outcomes, using 1PD (MMM) to help them make informed decisions and stay ahead of the competition, with no dependencies on 3PD.
So where is the future going?
Those businesses that adopt a cohesive multi-measurement strategy for assessing the impact of their media will be the winners of this new wave. It is crucial to understand your media’s real-world impact, whilst also being able to pull optimisation levers in flight, and only by employing a mix of measurement solutions will this be achieved.
As we see the cookie disappear, lift testing will be the key to optimising in flight, with short bursts of testing everything from audience to creative elements within your campaign. Harnessing MMM to truly understand the impact of your channel mix on your real-world business performance will be the key to understanding if your macro investment choices were right, and to inform future planning.
Overall, the combination of machine learning, AI, and predictive modelling has the power to transform marketing measurement, drive ROI, and create more meaningful connections with customers in today’s fast-paced digital landscape.
Measurements will be changing a lot! The importance of staying informed about advancements in measurement methodologies has never been more important to businesses, especially those who are investing significantly in competitive fields.
This is the time to invest in data-driven measurement that you control to get ahead of the curve!
Questions or Comments?
Let’s connect and continue the discussion!
