With the death of third-party cookies underway, the pressure is on marketers to adopt latest solutions for targeting, tracking and measurement before long-standing tactics grow to be inoperable by the tip of the 12 months. While lots of Google’s efforts to lay the groundwork for a cookieless future have centered around its Privacy Sandbox proposals, the corporate this month announced plans for an additional tool that would help marketers in search of latest ways to measure the effectiveness of their promoting.
Google on March 7 announced the launch of Meridian, an open-source marketing mix model (MMM) that goals to provide marketers with the muse for comprehensive, privacy-durable measurement. The introduction of Meridian represents a serious step in boosting marketers’ measurement capabilities, but comes with its own caveats and challenges, according to industry experts.
“The initial impression here is that Google is once more rolling out a tool primarily tailored for its own products. However, what’s truly commendable about this release is that Google is recognizing a pivotal shift: the demise of traditional tracking and attribution methods,” said Matt Hertig, CEO of analytics company ChannelMix, in emailed comments. “This recognition is one other signal to marketers that the walled gardens are getting higher, marking a big breakthrough in adapting to the evolving digital landscape.”
MMM, MMM, good (and bad)
While MMMs have been around for the higher a part of a century, Google has observed a “renaissance” within the technique, with 60% of U.S. advertisers currently using MMMs and 58% of those not using these models considering doing so in the long run, per Kantar data cited by Google in a blog post. The tech giant defines MMMs as statistical analyses for measuring the impact of cross-channel marketing.
Meridian, which is currently offered in limited availability, with plans for general availability to all marketers and data scientists coming soon, is built around 4 pillars: innovation, transparency, actionability and education.
Meridian will work to make MMMs more accurate and analytically rigorous by incorporating methodology innovations around incrementality, reach and frequency; ensure transparency by being open source; provide wealthy data inputs across Google and YouTube to enable cross-channel budget optimization; and supply documentation and opportunities for further education.
“MMMs today should not perfect, but are evolving. With Meridian, we glance to help your team navigate toward your future North Star, each through innovation, and by sharing our data together with an open source model,” said Harikesh Nair, Google’s senior director for data science, within the blog post.
While it’s difficult to fully judge Meridian before it’s widely available, its 4 governing pillars and the flexibility for marketers to modify open-source algorithms to suit their unique business objectives could make it attractive to a wide range of marketers, according to Tina Moffett, principal analyst at Forrester.
“Meridian could also be enticing for the mid-market brands which have data scientists or people who find themselves savvy with analytics that may use Meridian’s algorithmic framework to construct a marketing mix model, but may not have a giant budget to go along with other independent marketing analytics vendors or service providers,” Moffett said. “I believe that is where the sweet spot shall be for Meridian.”
“There’s just a little confusion available in the market of what an MMM does versus what an advertiser actually needs.”
Tina Moffett
Principal analyst, Forrester
However, as with Google’s Privacy Sandbox proposals, Meridian shouldn’t be seen as a one-to-one substitute for the form of measurement allowed by third-party cookies. Marketing mix modeling inherently cannot provide the identical level of granularity in tactical, day-to-day reporting about ads being served to specific audiences at specific times, for instance.
“There needs to be just a little bit more clarity around what an MMM can provide and what it cannot,” Moffett said. “I believe there’s just a little confusion available in the market of what an MMM does versus what an advertiser actually needs.”
Despite advertisers’ long-term reliance on third-party cookies, the technology has been an unreliable mechanism for tracking online behaviors and targeting media buying amid an increasingly fragmented marketplace. By removing third-party cookies from the board, Google is encouraging marketers to use tactics like MMMs that, while less granular, could be simpler overall.
“You don’t necessarily need that form of data to make investment decisions, and I believe Google realized this and created this framework for advertisers which can be promoting inside YouTube or buying media inside Google to make smarter investment decisions inside the ecosystem,” Moffett explained, noting that MMMs will help with larger decisions about budget allocation.
Steps marketers must take
There are several steps that marketers looking to utilize Meridian to construct their very own MMMs must take, according to Moffett. The primary challenges that enterprise clients face when using marketing analytics models, including MMMs, are transparency and selling it to business leaders — despite businesses putting a premium on analytics and technical knowledge — according to a recent Forrester Wave report. And while Meridian is open-source, that doesn’t guarantee full transparency.
“It’s transparent for the info scientists and the machine learning engineers because they will see the code,” Moffett explained. Forrester’s research shows that VPs and CMOs are sometimes buying marketing analytics model tools and services providers but don’t necessarily understand how underlying models or algorithms work.
To ensure true transparency around models like MMMs, organizations must provide you with plans to engage not only stakeholders who use the models, like data scientists, but primary stakeholders and marketing executives who make purchasing decisions. Transparency levels will differ across those groups, Moffett notes.
That transparency goes hand-in-hand with education around different service providers and never only their competencies around measurement but additionally their ability to develop tactical strategies which can be tailored to brand needs.
“It’s essential for advertisers to really take into consideration constructing a holistic strategy,” Moffett said. “What that appears like, tactically, will not be only marketing mix as an option, but understanding what different methods will help answer certain questions and what their goals are.”
For example, MMMs can helps allocate budgets to appropriate programs and channels to drive short-term revenue goals. But marketing executives will likely also need other models and tools to measure incrementality, or identity-based approaches that underpin sophisticated attribution models — two areas where Forrester sees marketers investing in measurement. While it would only help with certain measurement cases, Meridian remains to be a serious step forward for marketers preparing for the death of the cookie.
“Meridian symbolizes one of the significant changes in marketing over the past 15 years,” said ChannelMix CEO Hertig. “Tools like this offer a latest opportunity for marketers to rejuvenate the analytics space by leveraging advanced technologies like AI for effective navigation on this latest era… This way forward for marketing measurement is now.”
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