CURRENT PRACTICES IN ATTRIBUTION AND ROI ANALYSIS

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A White Paper For The Coalition for Innovative Media Measurement and The 4As

February, 2017

What is the current state of marketing/media ROI analysis – and marketing mix models and attribution?

That’s what we set out to determine.  We interviewed industry experts and issued an RFI to research providers throughout the industry.  What did we learn? The promise of attribution is compelling. As one marketer said; “We are looking into adapting marketing mix modeling into something more dynamic and useful – more like attribution.” And marketers are willing to experiment and learn.“We’re on Year 2 of a 5-year journey.”  But there is a lot more to be done and our paper provides a roadmap and important next steps for the media measurement and analytics industry.

 

Downloadable from CIMM!

https://lnkd.in/eVRvTiZ

 

Driving Profitable Growth with Full Customer Attribution Modeling

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Case Studies in Attribution

March 29, 2017

 

The promise of attribution is compelling — analytics at the tempo and granularity of management decision making. Its defining characteristic is that it operates at the individual level — and brings consumer insights back into marketing.

The next few years will bring great excitement as the industry leaps to the next generation of analytics and ROI-based decision making. We had the opportunity to work with our client, MMA, to highlight several case studies that demonstrate attribution modeling that reaches beyond the digital silo … that include offline marketing and baselines to avoid misattribution … and that help marketers distinguish long-term branding and short-term conversion tactics.

Work like this should propel the analytics industry forward and ensure even greater business success.

Here’s the paper that sheds new light on the subject! Copy the link and drop it into your browser.

https://www.dropbox.com/s/tpwxudr6i3f2krg/Driving%20Profitable%20Growth%20Through%20Full%20Customer%20Attribution.pdf?dl=0

 

 

Case Studies In Holistic Marketing Mix Modeling

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New Sequent Partners White Paper

March 28, 2017

Marketing Mix Modeling is evolving as a discipline. Sequent Partners recently looked into a number of revealing case studies on behalf of our client MMA, the venerable modeling/analytics company.

This work showcases the huge payoff associated with applying precise, reliable modeling analytics to the fuller set of business drivers that impact sales and profitability.  Sales force efficiencies, retail environment characteristics, online/offline media synergies, customer segmentations and other factors all meaningfully influence conversions and sales — and dramatically affect the impact of marketing.

By encompassing areas of management decisions beyond marketing, modeling can steer investment strategies and transform businesses.

Here’s the paper – drop this into your browser.

https://www.dropbox.com/s/bsl58u2yzl2jarx/Driving%20More%20Profitable%20Business%20Investments%20With%20Holistic%20Commercial%20Effectiveness%20Analysis%20.pdf?dl=0

 

Combining Marketing Mix and Attribution Models

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Combining Marketing Mix and Attribution Models

Admap - December 2016

Attribution modeling has emerged as a more agile, dynamic and granular alternative to the lumbering, macro marketing mix models of the past and moves us on from measuring to managing ROI. But while the science is still raw, the challenge facing the industry is how to integrate the best of both approaches.

Read the Full Report
 

Marketing Measurement Evolves:

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Jim Spaeth and Alice K. Sylvester from Sequent Partners were published as part of the RAB Radio Impact Reports Series.  Their paper, “Marketing Measurement Evolves: Why You Should Care about Multi-Touch Attribution is a preview of the industry’s Attribution Accelerator Forum in New York on November 30th. For more information and a full agenda please visit here.

 

Read the Full Report

 

Current State of Marketing Mix Models

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Current State of Marketing Mix Models

A Report for the Council for Research Excellence

Sequent Partners, June 2013

Objectives

Our objective is to provide the Council for Research Excellence an in-depth understanding of the principle methods currently used to estimate advertising ROI and take actions, such as budget allocations, on the basis of those estimates.

An impartial assessment is made of the strengths, weakness, opportunities and threats related to key aspects of the data, analytical techniques, and organizational processes employed. We also initiate a process to define best.

 

Read the Full Report
 

Advertising in Context

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The Anthropology of Contextual Media Planning

Tom Laranjo
Admap - May 2015

The arrival of advertising technology, powered by intelligent, algorithm-driven machines, means we're all obsessed by 'maths'. As Sir Martin Sorrell puts it, 'Maths Men' and 'Mad Men' have come together to marry science and art.

It's a seductive idea: the intuition and creativity of traditional Mad Men given added impetus by the rigour, data analytical skills and empiricism of Maths Men. The combination of mass digitisation, the proliferation of devices, and the rapid development of programmatic trading, means the advertising business has a wide canvas on which to bring this new era to life.

At the heart of this idea lies the notion of contextual advertising, the possibility of serving up the right ad, to the right individual, at the right time, when they are at their most open to relevant commercial messages.

Contextual advertising is based on four pillars: time, location, device and content. By pulling together these four variables, we can create more meaningful, more relevant, advertising solutions. Take the example of a digital display ad for a Software as a Service (SAS) provider served up to a CEO poised to make a major investment in their IT infrastructure.

 

Read the Full Report

ROI Driven Programmatic

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IN BRIEF

Advertising ROIs, as measured in marketing mix models, are marginal on average.  Anecdotal evidence suggests that this may be getting worse.  There is an opportunity to use emerging ROI related analytics and metrics to guide better media/advertising decisions, reversing this apparent decline.  Such new capabilities could enhance marketing in many ways, but a better “guidance system” for programmatic buying is certainly one of them.

 

THE PROBLEM

Sequent Partners has done a lot of work with various methods of measuring marketing ROI.  Over the past few years we have done a number of public and proprietary studies of the landscape that have put us in close communication with all of the important modeling companies.  Both our direct experience with modeling and the interviews we’ve conducted with every major modeler confirm that advertising ROIs are marginal.

 

That’s not to say that there aren’t some great campaigns that do well.  Some industries fare better than others and some media perform better than others.  But it is a common situation that advertising investments often need to be justified with a variety of arguments.  For example, one favorite is - “when you count the long-term effect, the sales effectiveness of advertising is really twice what was estimated by the model and the ROI twice as high, as a result.”

 

Most recently, we have spoken with a number of experts from the advertiser, agency and modeling worlds who suggest that this situation may be getting worse.  They often cite “the lack of fundamentals” as a potential cause.  Poor creative, creative poorly paired with media environments, poor control over scheduling and reach/frequency and unsure targeting based on look-a-like models are all contributing factors  to this ROI decline.  We only take these as hypotheses, but judgment suggests they may not be wrong.

 

When you consider the rapid move toward programmatic and other less comprehensive forms of automation, this issue earns an exclamation point!  While computerized buying and allocation is unquestionably a necessity in today’s micro-fragmented media world, the algorithms have to be smart enough and fueled by metrics good enough to replace human judgment — or else the result will be worse.

 

THE SOLUTION

Modeling has been used to measure marketing ROI for decades.  Most often it is used on an annual basis, its insights used to shift money around inside the marketing budget.  A model may conclude that one medium wasn’t a good investment, the brand should allocate those funds to a different medium next year.  Useful.  But it reduces the role of the marketer to a fund manager, buying and selling assets.  It often results in over-investment in one medium, driving it to the point of diminishing returns.  Marketing used to be a creative function!  The real opportunity should be in finding insights that enable the marketing team to make each medium the best investment it can be.  (Especially when, from a strategic, or channel planning, perspective they know that each medium plays a different role to move the consumer through the purchase journey.)

 

We are at the beginning of a new generation of ROI analytics.  Single-source data, attribution modeling, big data, agent based models and other tools deliver granular insights at the level of households, and eventually consumers.  Modeling insights at the market or store level were great for marketing activities that happen at those levels, like promotion.  But advertising is about consumers.  These new solutions could guide: targeting, creative strategy, media selection at the media vehicle level, and the effective joining of brands with creative with media and life context to deliver the right message to the right consumer in the right moment. 

 

SO WHAT?

It seems clear to us that moving from market or store level data; from mix modeling to attribution modeling; integrating media and the vehicle level and creative at the execution level, will enable marketers to move from measuring ROI to managing ROI for better business outcomes. 

 

The most immediate frontier for this evolution is programmatic buying.  With the newest innovations in measurement and analytics enlisted, programmatic can be expected to produce better and better ROIs.

 

If not, a different three letter acronym will prevail – CPM — where cheaper is better and quality goes unnoticed and underutilized.  That’s a race to cheap, low quality media that will only deliver an acceptable ROI when it is cheap enough.  Prices will drop, budgets will be reallocated to more effective marketing factors.  A gruesome future for media and agencies and a huge missed opportunity for advertisers.