Marketing professionals use a variety of measurement tools and methodologies to gain actionable insights in order to devise an effective marketing strategy. Marketing mix modeling (MMM) and data-driven attribution are two of the best and effective measurement tools available for the marketing functions. The management often questions the disconnect between marketing spend and its impact on the bottom-line. Marketing mix modeling is the process of using statistical analysis to evaluate the impact of historical performance data and predict future marketing investments. It helps the marketing function to understand the contribution of each element towards the overall success of the brand and its financial return.
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In simple terms, when you integrate marketing mix modeling with your measurement mix, organizations can amplify their digital attribution insights by linking online and offline marketing channels. This will help marketers to evaluate not only the past but also the on-going campaigns, and streamline future marketing plans across channels. It assists in identifying and measuring media channels that drive a business’s sales. This can be done by gathering weekly data and trends for each location, enabling organizations to understand how the marketing mix model works in tandem with economic and business factors in general. The plus point of the marketing mix modeling concept is that these models are built on actual and real-time sales data by encapsulating the way a business performs in the market.
Why Your Organization Needs Marketing Mix Modeling (MMM)?
The secret for any organization to successfully integrate marketing mix modeling with its measurement metrics is to comprehend the fact that these insights play a big role in taking business decisions. However, marketing professionals should note that these models are only an aid to facilitate judgment and not a substitute for good judgment.
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Traditionally, old marketing mix modeling methods revolved around the complex, inaccurate, and historical data sources which gave sporadic and vague perspectives about the marketing spend value. But today, owing to the increased popularity of digital attribution and data-driven insights, modern marketing mix modeling has matured enough to make use of additional data inputs and a wide range of marketing variables. The four marketing variables or the 4Ps of the MMM model are Product, Price, Promotion, and Place (distribution). Therefore, when marketers invest or allocate money across these marketing variables, MMM helps them to calculate the ROI each marketing and advertising campaign contributes to the overall business success and facilitates budget planning by analyzing data from both online as well as offline channels.
The marketing mix modeling has a widespread application in the service sectors such as the BFSI industry, the Telecom industry, and the manufacturing sectors such as the pharma industry as it helps them predict future investments based on past as well as real-time marketing and sales data. At Quantzig, we offer solutions that help clients to optimize their marketing campaigns and drive strategic decision making based on marketing analytics, campaign analytics, and attribution modeling.