Marketing Mix Modeling: The Why?

Walter D. Scott, an American psychologist and professor of advertising, remarked in 1909:

"Man has been called the reasoning animal, but he could with greater truthfulness be called the creature of suggestion. He is reasonable, but he is to a greater extent suggestible."

When was the first time you encountered an advertisement?

For those born in the 2000s, it was likely through social media ads. If you grew up in the 80s or 90s, it probably came from television commercials. For earlier generations, it could have been via websites, radio, newspapers, magazines, or even wall posters. We don't have to go back all the way to 4000 years ago but advertising has roots stretching to the Egyptians using papyrus and the Chinese employing copper plates. I don't expect anyone from those generations to read this blog though.

But if you’re, do drop me a message! 😉

Scott’s observation has proven increasingly accurate as time has gone on.
It has proven that humans, while rational and reasonable, we fall for whatever is suggested. The art we appreciate, symmetry, colours to like, books to read, etc. everything we do have a reasonable amount of recommendations from people around.

As technology advanced, so did our methods of suggestion. Influencing a decision to purchase an item or even forming an opinion is based on various advertising techniques. Marketing strategies subtly guide our perceptions and actions. Billions of dollars have been invested in suggesting people what to think.

It obviously raises significant privacy concerns. With every data collection and harvesting platforms being used to tailor ads, the invasive nature is unsettling. In the battle between convinience and privacy, the soldiers lost are our own inhibitions. The blurred line between surveillance and helpful suggestions makes us question our autonomy and control on our own life.

This pervasiveness is not new though. Internet has only scaled it up. The key lies in how these suggestions are used. Some have used it to spread the awareness, start a revolution, seed the ideas and grow them like a forest.

Religion might have had the oldest successful mass marketing campaigns.

Religion is a very powerful tool for the manipulation of people. -- Richard Dawkins

As we navigate this landscape where every second is tinged with suggestiveness, it's important to understand how we analyze and optimize these influences.
This is where Marketing Mix Models come into play.

In a nutshell, MMMs collect data from various channels and tell how the impact of our advertisements have been on people at an aggregate level. It doesn't focus on singular customer journey through out the web, doesn't necessarily offer tracking an individual.

MMMs aren't just about tracking what works though. They help us create a framework to balance people's autonomy and give them reasonable suggestions that resonate with them. Without impacting behaviour at an individual level with persausive tactics, the framework helps create effective strategies. Instead of personalised ads, we would be able to translate the age old "place a wall poster on this street, lot of teenagers play football here." to the internet marketing world.

A surveillance on people is never in their best interest.

"The more you can make someone think they’re being watched, the more you can make them act in ways that you want." -- Cory Doctorow, author and activist.

As we move forward, demanding regulatory disciplines and advocating for transparent practices will be crucial. Analytical tools like MMMs help us refine our strategies and foster a marketing environment that supports informed, empowered choices.

P.S.: Like any framework, Mixed Marketing Models do suffer from consequences of impacting a set of population. It brings down the people to an absolute digit or data point in the realm. The marketing folks using these models must be mindful of impacting lives and not merely impacting purchases.

Part 2: Marketing Mix Modeling: The How will cover technical aspects.