Measuring Marketing Effectiveness

The Guest

As the founder of Recast, Michael Kaminsky is committed to ridding the world of wasted marketing spend, using advanced techniques and technologies to solve the most important problems in marketing measurement. He’s worked as a senior analyst, data scientist, a director of analytics, and now he brings his spreadsheet of skills to the NinjaCat podcast to talk about measuring marketing effectiveness.

Marketing effectiveness VS efficiency

Our conversation with Michael began with an overview of the differences between efficiency and effectiveness in marketing. Michael explains that the difference between efficiency and effectiveness comes down to goals.

“Efficiency is doing more with less, and if that’s your goal, great," says Michael. "But if you want to rethink how you measure marketing, figure out how to expand and do new things, this is where effectiveness comes in. Ideally, long term efficiency is an outcome of effectiveness, so the goal is to have a clear understanding of how you measure marketing impact and always aim to be somewhere in between the two concepts.”

What goes into measuring marketing effectiveness?

We then pivot towards measuring marketing effectiveness and hear about how MMM (marketing mix modeling) is a great tool for teams, and datasets, of a certain size.

“You asked what goes into proper measurement of marketing and in my view,” explains Michael, “it’s about incrementality and narrow MMM; attention metrics, audience reach, and funnel stages are all critical metrics to measure and make smart bets on. However, MMM is not for everyone. Bigger brands that have both offline and online channels. spending millions on paid advertising will see more benefits from MMM because they can’t rely on marketing attribution models that work fine for smaller size teams.”

Michael then unpacks MMM and what kind of insights marketers can unearth and aim their strategies towards through proper use of this measurement technique.

Is marketing mix modeling for you?

“MMM is a top down historical model using stats to look for revenue boosting patterns in the data,” states Michael. “Ideally, MMM can be a central location to pull all the performance data and then use that to optimize budgets, ID opportunities with media, seasonality trends. Most businesses have a bunch of disconnected spreadsheets where marketing effects and impacts are measured, MMM is a way to consolidate and calculate all that activity into insights that can become actions.”

The future of measuring marketing effectiveness

When the conversation pivots to the future of measuring marketing effectiveness, Michael shares some interesting observations about how the ways marketers have historically measured performance may clash with the future.

“With limited visibility and lack of ability to track people across channels and devices, its been hard the last few years, and it's going to get harder,” says Michael. “Fragmentation and walled gardens in social/CCTV, can make stitching a user's journey across all those platforms and places hard, so I think marketers need to think about what metrics they are using to create effective marketing performance reporting. You have to recognize that there will always be a part of the journey that is unavailable, and historically this has always been the case, but since all these platform-based analytic tools showed up, this lack of data feels scary, but it’s really just the same effectiveness measurements marketers have been using for decades. If you're basing strategy off attribution models, you’re going to bias the channels you can track, and then you prevent yourself from expanding into channels where tracking is traditionally difficult. You have to really embrace omnichannel metrics, incrementality, and experimentation if you want to get ahead of the datapocalypse.”

To hear a few stories about effectiveness gone right (and wrong), how smaller brands can get into MMM, and if Michael prefers breakfast in bed, listen to the entire show at the links provided. 

The Links

https://getrecast.com/
Michael on LinkedIn

LISTEN TO THE FULL SHOW -> Stay tuned, stay curious and subscribe to What Gets Measured on Apple Podcasts, Google Podcasts, Spotify, YouTube or add it as a Favorite on your podcast player of choice.