At Recast we generally recommend using spend — not impressions — to represent channel activity in a marketing mix model. This isn’t a technical limitation of the model itself, but rather reflects our beliefs about the critical limitations of “impressions” metrics that modelers should be aware of. This recommendation is …
Scenario planning or demand forecasting decides everything an enterprise does. Right from quantities of raw material sourced to the inventory that needs to be stocked, through to shipping, packaging, hiring, and all the way down to purchasing office supplies — everything is dependent on accurate forecasting and scenario planning. Forecasting …
You cannot double spend and expect sales to double. Advertising on auction-based platforms like Meta or Google exhibits diminishing returns, meaning as you increase spend, efficiency suffers. When you continue to increase your advertising spend you see increased customer acquisition cost (CAC) and lower return on investment (ROI). Essentially, there’s …
Diminishing Returns: Accounting for Channel Saturation Read More »
Disclaimer: This blog post was written by an external contributor about detecting and addressing heteroskedasticity in marketing mix models. The approach laid out in this document is not reflective of how Recast approaches heteroskedasticity and model validation. The actual model specification can be found in the technical model specification. Heteroskedasticity …
How to fix heteroskedasticity in your Marketing Mix Model Read More »
Multicollinearity is one of the hardest problems in marketing analytics. If you took a statistics course in undergrad, you might have covered it; it describes a phenomenon where two or more variables in a model are correlated. Let’s bring it to marketing to make it more tangible. Imagine we’re trying …
How D2C Brands Can Deal with Multicollinearity in their Marketing Mix Modeling Read More »
With digital tracking breaking and privacy concerns on the rise, more consumer brands are looking for alternatives to multi-touch attribution. While MTA is still the standard measurement method, especially in the early growth stages, marketing mix modeling is quickly growing in usage across top brands because it only needs aggregate …
There are three main ways that consumer brands measure marketing effectiveness: digital tracking (MTA), marketing mix modeling (MMM), and testing/conversion lift studies (CLS). For the last few years, we’ve lived in a world where most consumer brands didn’t have to think too much about this – they got away with …
Top consumer brands don’t pick one measurement method: they triangulate. Read More »
Marketing Mix Modeling’s main goal is to find the incremental return of every marketing investment – how many sales did each channel drive that we wouldn’t have gotten otherwise? If you can find true incrementality, you can use it to optimize your budgets, get the right channel mix, and get …
3 Methods To Validate Your Marketing Mix Modeling for True Incrementality Read More »
Most small e-commerce brands probably don’t need anything more complicated than digital tracking tools for measuring marketing performance. But when the channel mix gets more complex and their marketing grows, digital tracking is simply not enough. After $100k+ / month in paid media budget, it’s a good time to start …
From Digital Tracking To MMM: How Brands Scale Through Marketing Experimentation Read More »
MMM is hard – we totally get that, but there are common mistakes made by consultants in the MMM space that need addressing. Here’s 10 of them: 1 – Focusing on the in-sample R-squared metric for MMM models. The standard definition of R-squared is “the amount of variation in the …
