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Category: Research

Measuring the Long-Term Effects of Advertising with Marketing Mix Models

Marketing mix modeling is a well-established and widely used standard approach for measuring key drivers of sales or any other business metric. In our previous article we provided a detailed explanation of how this tool works and compared our solution with Robyn, the open-source tool by Meta. Here you will learn about how MMM is used to measure the long-term effects of advertising. MMM allows estimating the incremental increase in sales, driven by both media features (through the nonlinear transformation of their metrics — response curves) and other external factors (macroeconomic indicators, pricing, promotions, distribution, etc.). They are particularly useful and are usually applied for identifying the short and medium-term impact of marketing This approach works well for products in mature stages or those that have reached a certain level of brand-awareness. However, products in the growth or market entry stages often require a different approach. Brand-building through creating an emotional connection between the consumer and the brand forms enduring consumer preferences and directly influences the upward trend in sales. To understand and evaluate the real effectiveness of marketing in such cases, it is necessary to assess not only short and medium-term but also long-term marketing effects. Approaches to measuring… Read more »

Comparison of Facebook MMM vs AdoptoMedia MMM

Introduction to MMM Marketing Mix Modeling (MMM) has been around for over 30 years and almost every marketer at least once has heard about it. It was first introduced in the 1980s as a tool for analyzing the impact of various marketing activities on sales or any other business metric. The idea was pretty simple: if we can use multiple regression analysis to describe processes in economics, why not use it to establish a relationship that describes the responsiveness of sales to marketing spending? Since then, the methods and approaches have changed and improved, the amount of data increased, which led to the rise of alternative methods for measuring marketing effectiveness such as attribution models, but MMM stands as the most useful and essential tool for optimizing marketing strategies. Due to recent changes in privacy regulations regarding the user data, it’s getting much more challenging to implement third-party cookies into analysis. That is another reason to rely on MMM for measuring campaign performance. It only needs aggregated data to function and will not be affected by the phase-out of third-party cookies. However, MMM also may be challenging for those who want to use it in decision-making, because it is not… Read more »

Marketing effectiveness measurement in a cookieless world

Customer data online is getting more protected with new privacy-related announcements from Google and Apple. Marketers already have to comply with GDPR in Europe, CCPA in California, etc., and recent changes are going to influence marketing effectiveness measurement even more. After third-party cookies are eliminated and iOS 14.5 update is rolled out the effectiveness and accuracy of some measurement approaches will suffer. This article will help you understand how the changes will affect the tools you are currently using and what solutions you should add to your measurement arsenal to ensure business growth. Take a free test to check if your company is ready to face the post-cookie reality. Google has announced that it is going to phase out third party cookies in its browser Chrome by 2022, and Firefox 86 already has a total cookie protection feature. Another news comes from Apple, that has released an update for iPhone with a new privacy-related feature. IDFA tracking used to be enabled by default, and now you can opt out of in-app ad tracking, and 88% of iOS 14.5 users globally have already done so, which led to a negative reaction from Facebook and ad spending drop. The IAB Advertising Effectiveness… Read more »

Sponsorship effectiveness measurement: Part 1

Since sponsorship deals provide unique value, many brands are actively investing in sport and entertainment events. But not all of them know how effectively this money is spent, because there is no standard approach to measuring the impact sponsorships have on business KPIs. In the article we will discuss how planning and executing sponsorship deals can improve their accountability. Exploiting media resources of high-profile sport and entertainment events like Oscars or The Olympics gives advertisers access to a huge audience and allows creating unique brand experience, that is why companies are expanding their sponsorship portfolios. According to Forbes, in 2020 brands were planning to invest over $68 billion in different events, and the figure doesn’t even include related costs like activations, promotions etc. Here are some benefits of sponsorship that improve brand awareness, consideration and customer loyalty: Logo visibility: it’s the most obvious value. Whether a person attends an event, watches it online or on TV or just comes across promotions for the event, they will see the sponsor’s logo.  Activations & Promotions: these are activities carried out by the brand within the event, like organizing contests or giving out free product samples. They increase brand affinity and positive associations… Read more »

Marketing spend management in a downturn

Why cutting marketing spends during a downturn is not the most reasonable solution and how marketers can negotiate and justify the necessary investments when the company is trying to save money. In this article you will learn about four tips on managing marketing spends during a slowdown more efficiently. Since during crises and downturns budgets are especially strictly controlled as companies try to save resources, marketers find themselves under even more pressure to communicate the value of their investment decisions. Simply reducing media spends will not do because in the long term it will negatively affect brand equity and future sales. Here we will discuss some advice from a recent McKinsey article that can be useful for weathering challenging periods like we are currently going through. The Covid-19 pandemic has dramatically changed the market conditions and consumer behaviour, that’s why companies need to take prompt actions to stay competitive and secure future growth. If you use Marketing Mix Modelling to evaluate marketing performance, you need to adjust your models so that they would account for Covid-19 factor. We will also tell you how our solution helps to optimize budgeting and give the best performance with limited and fixed funds. Since… Read more »

Adapting MMM models to COVID-related changes

Evaluating media budget effectiveness and finding optimal media mix has always been an important and difficult task, and it’s even more so in the current situation during the COVID-19 outbreak. In this article we will discuss Facebook and experts’ advice on adjusting marketing mix models to the situation on the market and explain how our solution can be useful to marketers today. We are trying to keep you updated on all marketing measurement trends, that’s why we prepared an article on the use of measurement tools after the phase-out of cookies and IDFA. Get ready to privacy changes and apply solutions that won’t be affected by the new conditions. See how MMM, MTA, brand studies and other approaches are going to function without third-party cookies. Marketing budget allocation is a very important strategic process. And making the right decision is especially difficult when game-changing situations like the COVID-19 outbreak happen. Today it’s necessary to invest in channels that will bring measurable results. Marketing Mix Modelling is a well-tried, reliable tool that has been helping marketers to make well-informed strategic decisions and measure the effectiveness of advertising campaigns. In a previous article we said that modern MMM solutions meeting advertisers’ requirements… Read more »

Current state of marketing in Europe

Marketing industry is growing and developing all over the world, but everywhere the process has some unique characteristics. In this article you will learn about European marketing ecosystem, its trends, challenges and needs. We will also tell you how our solution can be useful to marketers. In May 2020 Boston Consulting Group published a report after surveying C-suite marketing managers in the UK, Germany and France. Here we will discuss what problems marketers in Europe face today and how they deal with them. Digital transformation has brought significant changes into the marketing industry, making technology and tools more complex and sophisticated to match the arising needs. To cope with the innovations and grow, 97% of European marketers turn to external partners in such areas as technology, measurement, media planning and buying, etc. Experienced agencies and consultants provide companies access to cutting edge technology and help them to increase ROMI.  Due to fragmentation of European market one-size-fits-all approach doesn’t work here, so campaigns have to be adapted to local cultures and languages. For the same reason countries progress at different pace and have different levels of digital maturity; the UK, for example, is ahead of all Europe in terms of it…. Read more »

Our solution to the current ROMI challenges

Even though marketing technology is advancing, existing tools don’t fully match arising needs and challenges of the industry. There are still no universal measurement standards, so marketers around the globe are struggling to justify huge investments, which amount to $560 bln annually, according to A. Guttmann research. In the article we will cover the limitations of the current ROMI approaches, that McKinsey experts point out, and our capabilities for dealing with them. We are trying to keep you updated on all marketing measurement trends, that’s why we prepared an article on the use of measurement tools after the phase-out of cookies and IDFA. Get ready to privacy changes and apply solutions that won’t be affected by the new conditions. See how MMM, MTA, brand studies and other approaches are going to function without third-party cookies. Due to users massively shifting to online and mobile content, a huge part of the marketing spend is allocated to digital channels. It’s a reasonable strategy, but what we do wrong is measure the results of such campaigns. We focus too much on short-term results and user-level data, that seem more accurate, just because the tools like multi-touch attribution allow it, and not always because… Read more »

CMA reveals digital advertising market problems in the UK

The digital marketing spend is growing putting marketers under pressure to justify huge investments. And even with a variety of measurement techniques it’s not easy to find what really works, especially taking into account transparency issues. In this article we discuss new problems related to digital media and how to cope with them. An independent government department in the UK that promotes competition and consumer law – Competition and Markets Authority’s (CMA) – carried out an investigation of digital advertising sphere as a part of the new strategy designed to better handle quickly growing digital economy. In July 2019, they started looking into operations of online platforms, including the two biggest ones – Google and Facebook. The report voices concerns about transparency of the business, but before we go deeper in detail, let’s take a look back and see how we got to the current situation. It all started with the 2016 ANA/K2 Intelligence report on media transparency in the U.S., which was a true wake-up call for the advertising industry. The report revealed numerous non-transparent business practices like rebates in different agencies. The fact that they failed to act in the best interests of their clients severely shook the… Read more »