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Marketing measurement, in plain English

Concise answers first, then the deeper explanation. The core concepts behind modern MMM, econometrics and marketing ROI, without the jargon.

What is MMM?

Marketing Mix Modelling (MMM) is a statistical technique that decomposes sales, revenue or profit into the incremental contribution of every marketing channel and non-marketing driver, so you can measure ROI and reallocate budget with confidence.

What is econometrics?

Econometrics is the application of statistical methods to economic data to quantify cause and effect. In marketing, econometrics is the discipline behind Marketing Mix Modelling: separating what drove sales from what merely correlated with them.

What is marketing ROI?

Marketing ROI is the incremental profit generated by a pound of marketing spend, divided by that pound. It is a causal measure: only sales that would not have happened without the marketing activity count.

How does MMM differ from MTA?

MMM (Marketing Mix Modelling) uses aggregate weekly data and statistical models to measure the incremental impact of every channel, including offline. MTA (Multi-Touch Attribution) uses user-level click and impression data to distribute credit across digital touchpoints. They answer different questions and are best used together.

Should I use MMM or incrementality testing?

Both. MMM answers 'what is each channel worth and how should I reallocate the whole budget'. Incrementality testing answers 'is this specific activity actually causing lift'. The best measurement systems calibrate MMM with a rolling programme of incrementality tests.

What is Bayesian MMM?

Bayesian MMM is Marketing Mix Modelling built on Bayesian statistics: the model is fit with prior beliefs about each parameter (informed by experiments and prior knowledge) and returns full probability distributions instead of single point estimates. It handles uncertainty, small data and calibration far better than the frequentist MMM of the 2000s.

What is Google Meridian?

Meridian is Google's open-source Bayesian Marketing Mix Modelling framework, released in 2024. It is a research-grade MMM library built on TensorFlow Probability, designed for advertisers who want a modern, calibrated MMM they can run in-house or with a partner.

What is Robyn?

Robyn is Meta's open-source Marketing Mix Modelling framework, first released in 2021. It is a semi-automated MMM tool that combines ridge regression, evolutionary optimisation and Bayesian elements to make MMM faster and more accessible.

What are adstock and saturation?

Adstock models the carry-over effect of advertising - the fact that a TV ad seen this week still drives sales next week. Saturation models diminishing returns - the fact that the tenth million pounds in a channel does less than the first. Both are essential ingredients in any credible MMM.

What is scenario planning?

Scenario planning is the process of using a Marketing Mix Model to simulate the commercial outcome of alternative budgets, mixes and market conditions before you commit. It is where MMM stops being a report and starts being a decision system.