If Neo focused on GainZ, he would have easily beat the AI Mix Models
TLDR: The gains from an MMM optimization are limited. It’s only through continued innovation that brands will sustain double-digit improvements in their media plan performance. The GainZ Matrix is a framework for balancing the risk and reward associated with innovations in your media plan.
Every year, clients expect more from their media investments. If you work with a media mix model (MMM), optimizing your channel mix typically yields a 10% improvement in performance.
So…where do major performance improvements come from if not a MMM? How do brands grow faster? How do we increase media gains?
Beating The Model: The Media GainZ Matrix
There are three inherent limitations in a MMM:
- The model does not know how to improve individual variables (tactical optimization)
- The model does not know how new strategies will impact performance
- The model does not know how new media and behaviors will impact performance
Rather than focus on tactical optimization, let’s look at new strategies and new media. As media planners, new thinking, or innovation, is how we beat the model. The challenge with innovation is that we can’t be exactly sure how new elements in our media plan will turn out. Like aggressive stock investments, higher expected returns means higher risk. This begs the question, “How much innovation do we need to hit our goals? How risky is our growth strategy?”
To help answer these questions I created the Media GainZ Matrix. (GainZ because it’s “Gladysz with a Z” )
(Also, shoutout to Igor Ansoff and Gym Bros for the inspiration)
This is a directional guide to align innovation with growth expectations.
- Optimization, Low Risk, ~10% Improvement: Reallocating across existing media and audiences.
- New Strategy, Medium Risk, Up to ~20% Improvement: Optimization plus changes in targeting, markets, creative, brand or CX.
- New Media, Medium Risk, Up to ~20% Improvement: Optimization plus new channels, partners, placements, formats or ideas.
- Disruption, High Risk, ~20%+ Improvement: Optimization plus significant changes to both the strategy and media.
This framework can apply to both cross-channel and in-channel recommendations. In both cases, it helps teams set realistic growth expectations.
Recalibrating Expectations
Clients are under a lot of pressure to grow…but even modest growth can be a tall order. Take the following example from a recent QSR brief.
- The goal is to maintain a 4% CAGR
- Media Inflation is 6%
- The media budget is cut 10% YoY
To grow 4% with 16% less requires a ~24% improvement in performance! Accordingly, this recommendation included new channels, creative, CX elements and a menu portfolio optimization. This is risky…and asking a lot of a media agency.
When an established brand faces high-risk, the ideal outcome is a reassessment of the brief. Combined with the GainZ Matrix, a trusted MMM can provide support for:
- Reduced media goals
- Increased media budgets
- New growth strategies (markets, products, diversification, etc.)
One way to balance risk is to titrate innovations over time. This measured approach validates impact and gradually incorporates new elements into trusted forecasting models. This is not simply “Test & Learn.” This is a continual effort to optimize and identify efficiencies that fund new, untested growth opportunities.
Without new elements in your media plan, the gains from repeated optimization will quickly plateau.
Arnold’s Gains Never Plateau
Arnold Schwarzenegger is the all-time greatest bodybuilder because he never stops growing. When he hits a wall, he makes changes and teaches his brain, or body, something new.
It’s with this same enthusiasm that we need to continuously innovate in our media recommendations to unlock new growth opportunities.
Innovation is how we teach our MMM to break through plateaus and deliver consistent gains. Innovation is how we beat the old model.
Together, optimization and innovation is how brands grow faster and die slower.
Leave a Reply