What is Meridian?
Disclaimer: This article is based on publicly available information on Meridian's website. At the time of writing this article (13th March 2024), Meridian accepts applications for early access, but is not available to a wider audience.
Meridian is an open-source Marketing Mix Modeling (MMM) package developed by Google, publicly announced in 2024 March. Meridian enables users to conduct Bayesian Marketing Mix Modeling, and is expected to replace Google's first Bayesian Marketing Mix Modeling package, Lightweight MMM. Below is a screenshot from Meridian's landing page:
With Meridian, skilled analysts and data scientists can create Marketing Mix Models with ready-made modeling tools:
Building models with python
Reviewing model outputs (such as Marketing ROI, Diminishing return curves) in plotted graphs
Optimizing media budget allocations by building scenarios with python and reviewing output as plotted graphs
Meridian makes it faster for data scientists to build Bayesian Marketing Mix Models, compared to developing MMM features, such as adstock or diminishing returns, themselves.
Background of Meridian
While Meridian builds on the achievements of Lightweight MMM, it also incorporates the long-standing research work done by Google on Marketing Mix Models. We at Sellforte are big fans of Google's work on the topic, and have incorporated many of the ideas from Google's papers in our work. Examples of Google's research on Marketing Mix Modeling below:
Challenges And Opportunities In Media Mix Modeling (2017, Google - Chan et al.)
Bayesian Methods for Media Mix Modeling with Carryover and Shape Effects (2017, Google - Jin et al.)
Geo-level Bayesian Hierarchical Media Mix Modeling (2017, Google - Sun et al.)
Hierarchical Bayesian Approach to Improve Media Mix Models Using Category Data (2017, Google, Wang et. al)
Bayesian Hierarchical Media Mix Model Incorporating Reach and Frequency Data (2023, Google -Zhang et al.)
Media Mix Model Calibration With Bayesian Priors (2024, Google - Zhang et al.)
Who is Meridian for?
Meridian is built for:
Data scientists and skilled analysts, who wish to do the whole Marketing Mix Modeling workflow themselves, from data cleaning to model outputs.
Hobbyist modelers and statisticians who wish to learn more about how Marketing Mix Modeling works.
Key features
Meridian's key features include:
Marketing Mix Modeling package with Bayesian approach:
Incorporating external knowledge in the form of priors
Accounting for media saturation and lagged effects
Evaluating and reporting model goodness of fit
Media budget optimization and estimation using what-if scenarios
Hierarchical geo-level modeling (instead of national modeling)
Optional use of reach and frequency data for additional insights:
Modeling lower funnel channels (such as paid search)
Extensive documentation
1. Bayesian Marketing Mix Modeling package
Similar to Lightweight MMM, Meridian offers marketing mix modeling based on the Bayesian framework, which has become popular in the marketing mix modeling community. It should be noted though, that it is not the only approach. For example, Robyn by Meta does not use Bayesian approach.
Incorporating external knowledge in the form of priors. Bayesian modeling is the gold standard for marketing mix modeling for many reasons, of which one is the ability to provide external information to the model in the form of priors. Optimally priors are set to be as informative as possible, leveraging lift tests and other information about the behaviour of the medium.
Media saturation and lagged effects. Being a marketing mix modeling package, Meridian incorporates the industry standard MMM features, such as adstock and diminishing returns, to account for media saturation and lagged effects.
Evaluating and reporting model goodness of fit. Meridian provides tools for the data scientist to review model fit statistics to understand statistical quality of the model, as well as to evaluate and compare different models against each other.
Media budget optimization and estimation using what-if scenarios. Meridian enables users to get optimal budget allocations, based on the modeling results, as well as how media ROI behaves in different scenarios.
2. Hierarchical geo-level modeling
Based on Google's research paper Geo-level Bayesian Hierarchical Media Mix Modeling, Meridian enables geo-level modeling. Instead of having one national model, Meridian enables splitting the model into geographies, and modeling them together in a hierarchy. This enables getting more granular results (instead of only national results), as wells as getting more robust results as the models are connected.
3. Optional use of reach and frequency data for additional insights
User can input reach and frequency metrics as additional inputs to the model. The objective is to reach more reliable results and deeper insights, as proposed by this article: Bayesian Hierarchical Media Mix Model Incorporating Reach and Frequency Data.
4. Modeling lower funnel channels (such as paid search)
Meridian provides the option to use Google Query Volume as a control variable in the model.
5. Documentation
Meridian has supporting documentation available, as illustrated below:
Limitations
Based on Meridian documentation, following limitations likely apply:
Focus on weekly data - daily data not supported(?).
No campaign-level results.
Not designed to be an end-to-end MMM platform:
No data connectors.
No data processing tools.
No built-in visualization / reporting tool with a graphical user-interface.
No easy end-user interface for optimization.
1. Focus on weekly data - daily data not supported(?)
"Meridian supports fully Bayesian models with 50+ geos and 2-3 years of weekly data." Source
Meridian's documentation on data preparation strongly hints that using daily data in the model is not supported, as all examples and recommendations only mention weekly data and the documentation package does not discuss how to address for weekday differences. The rich information available in daily data is lost if it's aggregated to weekly level.
Sellforte's recommendation is to use daily data in the modeling, as long as it's available. There are some industry segments and geographies, where weekly sales data might be the only available option. For example, some FMCG / CPG companies might struggle getting access to the daily sell-out data for their products in retail. But many companies, especially in retail, have access to daily sales and media.
2. No campaign-level results
"The Meridian model is focused only at channel-level." Source
Understanding performance of each media channel is already a great step forward for any marketing team, as it enables optimizing marketing budget across media channels. However, practical marketing execution typically happens in campaigns. Being able to track a campaign's performance and being able to optimize budget allocation across media within a campaign, are important MMM use-cases, which are currently not supported by Meridian.
3. Not designed to be and end-to-end MMM platform
As Meridian is not designed to be an end-to-end MMM platform, some features that are available in many MMM SaaS platforms are not available.
No data connectors. Getting the data together for modeling can be a huge undertaking if done manually. In larger MMM projects, time can be spent on data gathering than on the modeling. With Meridian, the user is responsible for orchestrating the data gathering. When setting up Meridian, our recommendation is to use data connector companies, such as Supermetrics, for the effort, as they also enable automated data updates in the future.
No data processing tools. After the dataset for MMM has been collected, the next big hurdle is to process the data to be ready for MMM. Raw data coming from ad platforms and sales systems is rarely usable as such if one wants to get the maximum benefit from the data. Data processing includes for example setting up media and sales data hierarchies, campaign mapping, data transformations, and enriching the data. For example, getting campaign-level MMM results in requires advanced data processing. Based on the documentation, Meridian does not offer comprehensive tools for data processing.
No built-in visualization / reporting tool with a graphical user-interface. Meridian is built for data scientists and skilled analysts, so it is no surprise that the modeling outputs are static plots, which the user can print out with python commands. This can be sufficient for the data scientist building the model. However, making the analysis accessible for the stakeholders making decisions based on the analysis, the marking team, can be challenging with this approach. One option is to make PowerPoint decks based on the analysis. Another option is to build a connection to a dashboarding tool, such as Tableau.
No easy end-user interface for optimization. Meridian does not currently have an interactive tool for media budget optimization, and the optimization scenarios are built with python. Again, this can be sufficient for the data scientist, but makes scenario testing more challenging for the marketing team, as it takes time for the data scientist to translate marketing team's questions to code, and then communicate the results back to the marketing team, e.g. in a PowerPoint deck.