5 Advertising Questions Answered by Marketing Mix Models

Navreen Aulakh
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Understanding what drives marketing success can seem complex, but Arima’s Marketing Mix Modeling (MMM) simplifies the process by providing clear answers to advertisers’ questions. Using advanced algorithms and thorough analysis, Arima’s MMM is a marketing attribution tool that helps agencies and businesses make informed decisions that lead to real results. In this blog post, we’ll explore five key questions that you may have, that Arima’s MMM can answer. 

#1: How do I know which channels are driving results? 

Marketing mix models offer a comprehensive breakdown of spending patterns, showcasing the percentage of the budget allocated to each channel. This analysis extends to measuring past and ongoing advertising performance through channel attributions, considering factors like time decay. By leveraging advanced machine learning algorithms, Arima’s MMM tests millions of correlations between sales and marketing activities, generating precise channel attributions to validate the model's effectiveness.

Arima's MMM shows what channels are driving results

Arima’s MMM analyzes millions of sales and marketing correlations, validating its effectiveness with precise channel attributions.

#2: What should I do with an increased budget? 

The model assesses the historical performance of different marketing channels and activities. If increasing the budget is an option, it recommends the allocation of additional funds based on the channels that have demonstrated the highest return on investment (ROI) or growth potential. This may involve increasing spending on high-performing channels, experimenting with new channels, or optimizing existing campaigns for better results.

Arima's budget optimizer

Arima's self-directed MMM shows users the platforms that give them the highest ROI. 

#3: What is the impact of external factors on marketing effectiveness?

Marketing mix models address the impact of external factors on marketing effectiveness by systematically analyzing historical data and performance metrics. Through statistical techniques, MMM considers variables related to economic conditions, technological changes, regulatory influences, and competitive activities. By incorporating these external factors into the model, marketers can quantify their effects on key performance indicators, enabling a more comprehensive understanding of the marketing landscape.

MMM non-media factors

Arima's self-directed MMM allows you to input any non-media factors that may impact sales.

#4: Does MMM offer a combined view of both online & offline channels?

MMM offers a holistic view that encompasses both online and offline channels. It measures the combined impact of these channels, assessing how their interactions contribute to overall marketing effectiveness. This involves evaluating cross-channel effects, interactions, and correlations to understand the outcomes of the marketing mix.

Combined view of online and offline ads

Arima's MMM offers a holistic view encompassing online and offline channels. 

#5: Does MMM tell me how my ads work together?

Arima’s MMM recognizes that combining the power of two advertising channels can often yield a greater impact than each channel operating independently. It operates on the principle that 1+1 is greater than 2. For example, you can combine channels like outdoor advertising and online search to enhance brand-building efforts or utilize cultural tactics such as radio and newspaper for specific cultural holidays. The tool provides insights on when it is most effective to use channels together, emphasizing optimization for maximum impact.

Arima's synergy tool

Arima's synergy tool showcases what channels work most effectively together. 

As businesses navigate the modern marketplace, Arima’s MMM serves as a reliable partner, offering insights that pave the way for growth and success in today’s dynamic landscape.


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