Marketing Mix Modeling (MMM).
In my current role, the overwhelming amount of marketing data presents a challenge: the inability to quantify marketing decisions often excludes marketers from critical business conversations. A statistic shows that 72% of marketing executives feel excluded from key decisions due to this issue.
The Importance of Quantifiable Results
To be effective stewards of our marketing budgets, we need to confidently identify the impact of our expenditures and focus on strategies that deliver the best results.
Understanding Marketing Mix Modeling (MMM)
Marketing Mix Modeling (MMM) is a statistical technique that helps measure the effectiveness of various marketing activities and their impact on sales. It allows companies to allocate budgets more effectively by identifying the most valuable channels.
Example of Basic MMM in Action
For instance, a company can use MMM to evaluate the impact of digital ads, TV commercials, and promotional events on sales, enabling better budget allocation and maximizing ROI.
Testing Basic MMM in Real Life
To optimize the 2025 budget, I posed three key questions to our data:
How are my marketing channels generating leads over time?
What interactions occur before a contact is created?
How are my marketing assets generating leads over time?
After verifying data structure and alignment with my goals, I used ChatGPT to summarize the MMM results.
Summary of MMM Results
Step 1: Marketing Channels and Leads Over Time
Email Marketing: Highest impact on lead generation.
Social Media: Positive impact, but less than email.
Paid Search: Moderate positive impact.
Organic Search: Smaller, yet significant impact.
Direct Mail: Least impact.
Step 2: Interactions Before Contact Creation
Key Interactions: Website visits, content downloads, email opens, social media engagement.
Frequent Sequence: Website visit > Downloaded content > Email opened > Social media engagement > Contact created.
Step 3: Marketing Assets and Leads Over Time
Blog Posts: Highest impact on lead generation.
Whitepapers and E-books: Substantial positive impact.
Case Studies: Positive contribution.
Webinars: Least impact but still significant.
These findings show the need to refine marketing strategies, optimize budget allocation, and improve overall effectiveness. As we move into the Web3 era, MMM principles can be adapted to utilize blockchain technology for greater transparency and precision in tracking and analyzing marketing efforts.
In our quest to leverage marketing data, tools like MMM are essential. They not only justify our expenditures but also drive strategies aligned with business goals, ensuring relevancy in a data-driven future.