The vision of the advertising Holy Grail inspires awe in every marketer. The original quest for the Holy Grail is a metaphor for the path to enlightenment. In advertising as in life, the first step is to know if you're headed in the right direction. In this regard, media mix optimization and attribution management are the lead crusaders.
This vision encompasses a vast ecosystem that tracks all of the money spent in every form of advertising -- including search, display, social media, television, print, radio, billboards. It measures the impact of every campaign, compares media channels against each other, identifies which forms of media were most successful, and makes recommendations on the optimal amount of money to allocate per media channel. Some would add that it should automatically generate the content that will compel consumers to engage with the brand and buy the products, as well as placing editorial content in the most effective earned media outlet and buying the paid media at the most efficient price - all in order to obtain the highest return on investment.
The advertising Holy Grail could not have been envisioned until online media came of age. But it is so large and complex that no one organization can attain it all. So there are many crusaders pursuing different approaches. It starts with the ability to attribute value to media based on the contribution of each medium to the ultimate sale. Putting it more succinctly, it answers the big question, "Where should I invest my money to increase sales?" There are two approaches from opposite ends of the path: the bottom up -- attribution management, and the top down - media mix Optimization.
So which way to enlightenment?
There is room in this article only to highlight the arguments for and against each approach. For a detailed discussion, check out this article.
The approach most closely associated with attribution management is Web analytics sequencing, which attempts to address the question: "What is the order of media interactions or touch points required to compel a consumer to interact with my brand?" This approach is the purview of Web analytics vendors. It tracks the number and type of digital media touch points -- display, search and e-mail -- to which a consumer is exposed within a specified period of time before making a purchase, and then stacks them in order with the goal of setting up future marketing campaigns to follow this path in a more efficient manner. This approach does not take into account traditional media, which still makes up approximately 90% of all media spend. And human behavior does not follow an exact sequence. We are circuitous beings, as every marketer who has tried this approach has been reminded.
Media mix optimization, on the other hand, is aimed at answering the question: "Where should I put my money to increase brand engagement?" The goal is to consolidate data around how changes in media and promotion strategies affect sales. The most sophisticated advertisers practice this decades-old discipline. The biggest drawback is that the traditional process is expensive and can take up to one year to begin executing. When all the data are finally delivered -- usually in the form of a PowerPoint with the density of a dwarf star containing the detailed findings, plus a series of consulting sessions and a massive spreadsheet -- the higher level of accuracy that recency provides is gone. It applies only at the campaign level, so the direction it offers is strategic. It cannot give tactical direction like which keyword to buy at what price or how to coordinate online with offline. This is left to the specific media-buying systems to handle.
The largest barrier to executing media mix optimization has been the cost of getting the data, online and offline, in one place. Once this huge task is completed, then the media mix analysis must be made programmatic so budgeting recommendations can be done in near real-time. Advances in technology are getting us to the point of doing all of this at a cost that can provide ever-increasing ROI.
Before embarking on the path to advertising enlightenment, marketers need to know that they are headed in the right direction. Attribution management measures the steps along the path, but it cannot tell marketers if they started out on the right track.In this crusade, media mix optimization is the marketer's compass.