The merits of Marketing Mix Modeling (MMM) are universally acknowledged for organizations with multiple brands operating around the world. Without it, media budget allocation and MROI optimization would be a tangle of speculations.
Of course, What cannot be measured cannot be improved. Measuring media & communication efforts is a catalyst for optimizing marketing investment, and delivering actionable media and marketing plans. As such, it is crucial to harness the proliferation of Data Sources and mitigate against the difficulties of sharing data with external parties by in-housing Marketing Mix Modeling within your internal measurement efforts.
The Growing Interest in In-housing Marketing Mix Modeling
In-housing Marketing Mix Modeling has been on an upwards trajectory in the last years. This fact has only been consolidated as the epidemic has hastened the need for contemporary, future-proof, and robust internal measurement—a key foundation for optimizing Marketing Return On Investments (MROI). Furthermore, the newest privacy regulations and the rising increase in data sharing and security compromises make it a more compelling case for in-housing Marketing Mix Modeling as a key strategic measurement decision. According to a 2021 report released by Bannerflow, 58% of Senior Marketers say that technology has impacted in-house teams’ use of data. Additionally, 63% of marketing professionals reported a positive change in their ROI since in-housing. The report also shows that many brands are starting their in-house journey — leveraging advanced MMM technology with the right partners to navigate new marketing challenges. However, some organizations are considering relying instead on the open-source Marketing Mix Modeling solutions available.
Free Marketing Mix Modeling Software, Is it Really Free?
Of course, every Marketing Mix Modeling practitioner wants to get the most bang for their buck. They would not be doing their job properly if they did not explore employing open-source solutions such as R, which is considered to be “free“. Some could argue that such “freeware” solutions are similar to an iceberg in that their full cost is generally hidden. These hidden costs can manifest in various aspects such as:
- Estimating the total cost of ownership (TCO) of freemium solutions: Once you start using open source code, you would inevitably identify technical gaps. You would then have to employ people to make up for the shortcomings, tweak the code for your use case, and build your own solution. As such, many companies fail to calculate the time and resource commitment necessary to run and maintain the open-source code which translates in missed efficiencies and, ultimately, lost business opportunities.
- No support when attempting updates and troubleshooting: You cannot log a defect with the project and expect someone to solve it. The reality is that project contributors have no responsibility to do so, and the lack of transparent and well-structured documentation can make it hard to do it on your own. If you want to ensure that problems in such black-box solutions are resolved, you must either have the capability to correct them yourself or pay someone else to do it for you.
- Expensive and time-consuming setup: Rather than being free, such home-built MMM solutions can be exorbitant. They are frequently unstable, prone to errors, and present a steep learning curve to newly hired teams. As a result, MMM projects typically demand a significant amount of resources and time, making them unaffordable to anyone other than the largest advertising companies. A much wider pool of potential buyers is left out in the cold, despite the fact that a far larger market is just around the bend.
Why Rely on Ready-to-Use Marketing Mix Modeling Software
Advertisers and agencies alike need a robust solution that offers powerful and well-supported capabilities with guaranteed time and cost-efficiency. However, organizations willing to bring the Marketing Mix Modeling capability in-house often feel an unfamiliarity with its concepts, techniques, and process and find it hard to make a start without the required specialist support— something open source solutions lack. Ready-to-Use Marketing Mix Modeling software makes up for these shortcomings by:
- Establishing a supportive partnership with a specialist measurement provider: One of the most perks of ready-to-use MMM solutions in that regard is the underlying value of finding the right technology provider to effectively function as an MMM partner. Working with the right MMM partner will ensure that you are building powerful MMM capabilities that are staying up to date with the changes occurring in the industry in terms of model granularity, project turnaround speed, and model update frequency. This technical prowess will allow conducting various projects and update them at a higher frequency, which will ultimately provide more insights that can be leveraged for an increased MROI.
- Premium support and knowledge transfer programs: Experienced and responsive support teams can be the life or death of fast-paced measurement projects, and receiving prompt responses to your business inquiries can not only improve the accuracy of your modeling but translate into powerful insights with real impact. Additionally, leveraging an extensive knowledge-sharing program will decrease your team’s learning curve significantly, as they will be learning how to fully capitalize on the MMM solution from its very creators.
- The ability to run pilot Marketing Mix Modeling projects: Few MMM providers, such as MASS Analytics, even offer the ability to run collaborative projects and training courses to immerse your team in the field and teach technical independence as soon as possible. With no coding necessary and intuitive UX, these technical tools can turn an analyst into an Marketing Mix Modeling savvy statistician in record times. Of course, not all software providers commit to this level of transparency and support, which is why it is important to choose wisely.
- Marketing Mix Modeling software built specifically to fit your needs: Ready-to-Use MMM solutions are built to fit a specific need, with extensive support already accounted for in the pricing model. By working with a specialist MMM solution provider, you can rest easy knowing that the solution has been adapted and proven to be a good fit for your intended use. Finally, with provided training, support, and a strong development team keeping the software up to date, you can leverage the analytical power of MMM without worrying about hidden costs or data security threats, and you can easily estimate the return you would be generating from investing in them.
In the end, the benefits of building modeling capabilities internally are definitely worth the effort, but that’s easier said than done. The path to running Marketing Mix Modeling in-house requires investing in an in-house marketing analytics team, relying on a supportive and established technology provider which can train the client team, and leveraging powerful experts’ knowledge transfer programs for shorter learning curves.