❓ Why should performance marketing teams use Marketing Mix Modeling to optimize marketing ROI?
We discussed this topic recently in a webinar with the performance marketing team leader of Finnish Design Shop (ecom store for Nordic design products), Johanna Kuparipuro.
Still today, many performance marketing teams use Google Analytics 4 and ad platform -reported ROAS in marketing optimization. However, MMM adoption is increasing. These are the benefits of MMM:
👉 MMM-estimated ROI is based on true incremental sales driven by marketing
👉 MMM enables apples-to-apples ROI comparison of all marketing activities
Main limitation of ad platform -reported ROAS:
It is often inflated because it also captures conversions that would occur without marketing, as well as conversions driven by other media.
Main limitation of GA4's attribution approach (often last-click):
It typically overestimates effectiveness of media that are close to conversion (such as branded search), and underestimates the effectiveness of media earlier in the funnel, e.g. social media.