Marketing Mix Modelling Step-by-Step — Part 1: Building the Model
In part 1 of this walkthrough on how to build your own Marketing Mix Model we’ll touch on:
- What is a Marketing Mix Model?
- Data requirements
- Marketing carry over effects
- Diminishing return functions
In part 2 we’ll get into use cases from the output and wrap up the walkthrough by touching on:
- Channel contributions
- Predictive budget optimizations
What is a Marketing Mix Model?
With the number of marketing channels through which we can reach new potential clients increasing every year, it’s more important than ever to have an understanding of which channels are driving the business forward and which are not.
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” — John Wanamaker
In the world of online click-based marketing it’s fairly straightforward to identify channel performance, since, with the right back-end implementations in place, we can track click-throughs and assign attribution accordingly.
