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How does Marketing Mix Modeling help performance marketing teams?
How does Marketing Mix Modeling help performance marketing teams?
Lauri Potka avatar
Written by Lauri Potka
Updated over a week ago

Performance marketing teams - Here's 4 ways how Marketing Mix Modeling can help you

MMM has only recently advanced to the level where it can support decisions that performance marketing teams regularly make. MMM used to be about "TV vs Facebook", but today's MMMs support campaign-level ROI tracking within ad platforms. Here's four main ways how performance marketing teams today can use MMM:

1️⃣ Understand the level of saturation in each marketing channel

For example, it could be that your Branded Search is already at 90% of its maximum spend before the channel is saturated, but PMAX is only at 40%. MMM provides you response curves which enables you to analyze the level of saturation

2️⃣ Understand the true ROI of each campaign within ad platforms

ROI reported by MMM is based on true incrementality. This enables you to compare ROI of Facebook Ads vs Google Ads. Or a campaign within those platforms against a campaign in another platform. ROAS metrics reported by ad platforms are not comparable, even when comparing e.g., retargeting vs prospecting within a platform.

3️⃣ Optimize bidding strategy types and campaign objectives

MMM enables you to analyse the ROI for different bidding strategy types (e.g., target CPA, target ROAS, max conversions, max conversions value, enhanced CPC), and campaign objectives (e.g., sales, conversion, traffic). When you plan a campaign, you can check how different campaign objectives and bidding strategy types have worked for similar campaigns before. During campaigns, you can also reallocate more budget to campaigns with bidding strategy types and campaign objectives that seems to be working.

4️⃣ Optimize bid levels

You can optimize bid levels during your campaigns. For example, for campaigns within Google Ads, MMM helps you set optimal levels for target ROAS, target CPA, target CPM, or CPC bid ceiling, depending on your campaign.

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