An in-depth analysis of the current state of media ROI analysis has found that while progress has been made toward development of methods that enable near real-time cross-platform attribution and ROI analysis, much work still needs to be done and few viable integrated systems for looking at consumer behavior cross-platform are yet available.
The finding is the focus of a whitepaper, “Current Practices in Attribution and ROI Analysis,” commissioned by The Coalition for Innovative Media Measurement (CIMM) in collaboration with the 4A’s Media Measurement Task Force to determine best practices in cross-platform attribution and ROI analysis.
The research and recommendations were developed by Sequent Partners, a specialized media metrics and brand consultancy and presented today during CIMM’s 6th Annual Cross-Platform Media Measurement & Data Summit.
Sequent Partner’s review of current options for ROI analysis available says that the gap that has existed between marketing mix models, used for media and marketing budget allocation, and attribution models, which are purely focused on digital paths and allocation, is narrowing. But with differing approaches now emerging for an integrated cross-platform solution, the findings conclude that confusion among users is common and available options are falling short of delivering on promises.
“As in any early stage market, users are confused by conflicting terminology and skeptical due to the degree of overpromising from vendors,” says Jim Spaeth, co-founder of Sequent Partners. “What buyers need at this stage is to make sure they fully understand exactly what is being offered and ask smart questions to ensure the results will meet their business needs. The industry is on the right development path, and it’s too early to lock-in to one solution, which actually might thwart development.”
Sequent Partners, which interviewed twenty-one research providers in addition to industry experts in the development of its analysis, says that as methods evolve, the characteristics of what would define a best-practice solution are clear. Such a solution must:
- Provide sufficiently granular and timely detail to enable marketing plans to be optimized mid-course
- Employ a statistical model that can infer causality for all the elements of a marketing plan
- Incorporate a baseline, as well as all the drivers of consumer purchase behavior that could account for any variance in sales or other outcome variables
- Employ data for all variables that is truly representative of the brand’s business
Sequent Partners recommends buyers and users of cross-platform attribution methods ask vendors several key questions to ensure understanding and minimize disappointment:
How is attribution and marketing mix modeling being defined and how are they being used?
- Define every step of the process, from data inputs to modeling and model outputs.
How are macro level mix models and micro level attribution models being linked?
Does the data being used accurately reflect your business? Are the geographies covered representative of the brand’s business situations?
How are online and offline data being matched and potential distortions being identified?
What are the modeling techniques being used and how do they reflect the way in which consumers respond to advertising?
Does the media data in the model match currency levels? How are the data for each of the media linked together? Are individual ads and media placements identified in the data?
Does the model being used include all of the marketing drivers known to be important to the business?
While Sequent Partners foresees the emergence of models that can deliver the needed characteristics for an integrated approach, current issues with data and data integration lead them to recommend both mix modeling and attribution modeling as still being necessary. They say marketing mix models are the most reliable way to evaluate the sales contribution and ROI of each element of the marketing mix and attribution models are best able to optimize marketing tactics mid-campaign.
“What we are seeing is that simply taking the best of both marketing mix and attribution modeling and marrying the two has led to varying degrees of success,” says Jane Clarke, Managing Director and CEO of CIMM. “What’s needed are significant advancements in the area of integration of data, modeling techniques and organizational best practices. The analysis presented through the white paper presents a clear path for how to achieve that moving forward
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