Breaking the Black Box of ROI: Bringing Transparency to the Myth of MMM & MTA

Breaking the Black Box of ROI: Bringing Transparency to the Myth of MMM & MTA 1

Digital advertising is breaking records! In the first six months of 2019, U.S. digital advertising revenue hit $57.9 billion — the highest spend in history- according to the latest IAB PwC Internet Advertising Revenue Report. This translates to roughly $1.45 trillion marketing budgets for full year 2019, based on the CMO Spend Survey 2018-2019 by Gartner.

That’s not a trivial amount of money. Marketing investments are the lifeblood of countless brands and companies for finding and keeping customers. Which is why in today’s marketplace, CMOs demand proof in a clear form of return on investment for their stakeholders.

They require proof that their advertising works and not just in the form of standard media metrics such as reach, or vanity metrics such as engagement or click-through rate. Today’s marketers need metrics that translate into real business outcomes and actionable insights.

Ultimately, CMOs need to generate results that link to the business’s bottom line, not only for campaign validation but for planning and future earnings.

Enter MTA or Multi-Touch Attribution. As the digital ecosystem is continuously evolving, MTA has gained noticeable traction in the past few years, especially among digital players in our industry. However, many advertisers have been using Marketing Mix Modeling (MMM) for much longer and are hesitant to move beyond this more familiar methodology. Furthermore, when they tried to apply both, some experienced conflicting results which led to confusion and dissatisfaction.

With the belief that MMM and MTA can be complementary instead of competitive, IAB’s Measurement & Attribution Committee launched a working group focused on the reconciliation of MMM and MTA. The working group conducted an industry-wide survey and convened an expert panel to dissect these measurement techniques examining familiarity, benefits, challenges, pain points, and future plans.

Topline survey findings include:

  • MMM is more broadly adopted than MTA, especially among advertisers
  • The high cost of adoption, lack of knowledge, data collection, data quality, and transparency are the common pain points for both approaches

To demystify the “black box,” the panel of advertisers and industry experts explored topics ranging from methodology limitations, implementation thresholds and walled gardens of using both approaches, including how to choose the right vendors and when not to use MMM or MTA.

With such rich material, the working group has published a The Essential Guide to Marketing Mix Modeling and Multi-Touch Attribution that offers an overview of industry viewpoints on measurement techniques for marketers. The paper focuses on answering the following:

  • Why and how to use MMM and MTA together
  • What to expect from MMM and MTA including restrictions, and tradeoffs
  • How to choose a solutions provider

Rather than endorse any specific approach, this guide aims to empower IAB members and the industry with knowledge and transparency so each marketer can make their own informed decisions. We look forward to continuing the conversation about MMM and MTA in the coming months.

Read "The Essential Guide to Marketing Mix Modeling and Multi-Touch Attribution"


Sable Mi
Chief Research Officer
at NinthDecimal