Rockerbox

Had the chance to talk marketing measurement with Paul Kovalski on the The Efficient Spend Podcast. Outside of some usual topics (MMM, MTA, experiments, identity resolution) we touched on the concept of Paid Marketing Fit (a riff off Product Market Fit). Paid Marketing Fit is when a business has a repeatable way of acquiring customers via paid marketing with finance-determined marketing KPIs. Once you have Paid Marketing Fit, you’re well-positioned to start investing in marketing measurement. I’ve spoken to many brands that are looking for marketing measurement help before they have Paid Marketing Fit. I think this is the wrong approach. All that measurement will tell a brand before Paid Marketing Fit is that you need to start from zero and scale back up because none of your media is repeatable or hitting the marketing KPIs you’ve been assigned. The brands that most often come to Rockerbox without Paid Marketing Fit are early/earlier-stage, VC-backed companies. Admittedly, this has gotten better since VC Winter started in Q2 2022, but it’s still far too common.

Looking at other brands' marketing measurement is like copying someone's homework who isn't in your same class or even grade. "I heard [F500 brand] uses an MTA, so we should too!" "I know the CMO at [startup] and they just look at CAC!" "[B2B brand] doesn't even use incrementality tests..." "["Everybody", in quotes] is using MMM, we should too!" The fact of the matter is that all of the different measurement tools exist for a reason, and are heavily influenced by: • Industry • Brand maturity • Marketing complexity • Business model • Culture It's borderline trivial to do a geo-based incrementality test in ecommerce, but it's almost impossible to do so in B2B unless you're selling highly localized solutions (such as local small business providers). It's an absolute waste of time to do a complex marketing mix model (MMM) when you're a little ecommerce brand with one marketing channel, only sell online, and do seven figures of revenue per year. But for a massive brand with 3+ rev streams and 10+ channels, it's a must. Measuring CAC is a waste if your business is dependent on "one and done" purchases, because all that you should care about is overall revenue and margin delivered by the business. You're on borrowed team and your job is just to get the money when and where you can. But if you're a subscription or recurring revenue business then understanding CAC is vital to knowing if you can push and get more aggressive, or if you need to pull back to make your customer lifetime economics work. Multi-touch attribution is great if you've already saturated and dominated a market, and have cleanrooms and known first party data. If you're working with a super dialed in CDP or a CXP (think something like Sprinklr) and you're not in the acquisition game anymore, then leveraging deterministic tracking is more viable. An ecommerce brand though that's pushing nine figures and wants to carve out a sector a massive industry? I think the data issues and the custody of customer interactions is going to lead you astray, better to look at something else. My advice? • Know where you live in the maturity curve • Align methodology to relevant information • Use said information to make relevant decisions • Stop copying others' homework, it isn't useful Ecommerce: • <$10m: platform + blended metrics (MER/CAC) • $10-20m: above + simple incrementality tests • Four or more channels: above + light MMM • $50m+: start looking into CDP/1PD collection • $100m+: 'realtime' MMM + complex incrementality Don't waste your time copying the answers to another assignment. Focus on what matters. If you're sub $50m and struggling to grow, it PROBABLY isn't due to your measurement (it could be, but, probably not). It's more than likely something off with your product market fit. Want me to weigh in on how you're measuring today? Reach out and I'll give you my POV. #attribution #incrementality #mmm #measurement