What’s involved in in-housing MMO?
Managing growth and optimizing marketing investment by internalizing MMO is a journey, not a destination. It’s a long-term strategy that aims to drive lasting change – and not a quick-fix – which requires building internal capabilities in data, technology, and people, and at scale. Some of the barriers standing in the way of successful in-housing include: poor data readiness, a lack of team members with relevant skills, and a siloed business not structured to benefit from in-housed MMO.
Even if a business succeeds in in-housing some or all of its data management, modeling, and marketing analytics, an internalized MMO function will need constant evolution – with new or enhanced models, new data sources, new product lines, and new markets coming into the mix. It makes sense to in-house MMO progressively and not attempt everything at once and so to build a hybrid model in partnership with expert external service providers.
Internalizing MMO is a four-step process, starting with a review of the status quo to frame the challenge, followed by a “Build – Operate – Transfer” model to embed it in the business. Ironically, businesses looking to in-house MMO often kickstart the process by working with expert, third-party advisors – with experience of helping others on this journey – to assist with the framing process. This will enable you to understand and plan what’s required for in-housing, as well as how the business will need to evolve its organization and governance processes.
The first step is for a C-level sponsor to frame the human, data, tech, modeling, and analytics requirements for in-housing MMO. At Ekimetrics, we ask three core questions to assess a company’s MMO capability maturity:
From these three questions, we calculate a composite MMO capability maturity score which helps to determine the company’s expectations, the business case for in-housing, and standards – both key marketing drivers and data sets – specific to the business. The process of framing helps businesses align on objectives and set out ground rules for how they plan to achieve them.
It’s important to remember that, even if a company seeks to in-house most or all aspects of its MMO – an exercise that will absorb considerable time and resources – in-housing is not a “once and done” operation. There will likely be some short-term gains delivered in a matter of months, while other returns may take a year or two to be realized. Internalizing MMO will also require considerable resources to maintain and run the solution developed and to evolve it over time. In this way you can accommodate new marketing drivers, new channels and platforms, new brands and franchises, as well as second and third tier markets to which in-housed MMO could be introduced. This is one reason why many big businesses favor and have started to invest in a hybrid model.
In-housing MMO demands companies bring together, cleanse, and harmonize all relevant data sources into a data lake. This becomes the single source of truth for all MMO modeling and analysis. As far as possible, the data lake needs to automate data flows from all the agency partners, platforms, and publishers with and through which marketing activity is undertaken.
The first step in data integration is for a company to map out its data maturity in detail, moving beyond the global overview established in the Framing stage. This enables you to understand precisely what data and tech, people and skills, tools and processes are in place already; what you need to achieve your ambitions for in-housing MMO. This is followed by an assessment of data readiness, to create a common language in the business. This helps to ensure that, once pilots have run in a couple of markets, the MMO modeling can be industrialized at scale across the business.
Getting this right has two principal benefits. First, it will set you up for success for the long-term, as a wholly-owned data lake that successfully integrates the right data sources represents the foundation of great MMO. This is true whether it is delivered entirely in-house or by working with external partners. And second, this decreases the time marketing teams need to spend preparing data for MMO programs, saving both time and money whoever ultimately performs the analysis.
With the data lake created and being populated, the next step is to build pilot models using the data to optimize investment. This involves iteratively developing minimum viable products (MVPs) to test and assess operations, to inform second-generation MVPs, and then rolling these out across the business at pace. Often, MVPs can be created at the same time as the data lake is being architected and filled to deliver value and impact from the get-go rather than waiting for the full data lake.
Typically, the pilot phase and initial modeling are run in partnership between the growing team responsible for MMO within the client organization and expert, external partners.. But critically, MVP models are built using the client’s data lake and in its own environment to enable successful models to be industrialized at scale. However far a company goes down the route of internalizing MMO, the journey should always aim to create custom solutions.
It’s important to choose pilots carefully, and this will be determined in part by data maturity, ongoing marketing activity covered by the pilots, and the ability to imagine working differently tomorrow. You should aim to build at least two pilot programs, MVP1 and MVP2 – for different products and/or in different markets – so that when you assess their impact you can factor in different perspectives. Piloting is less about taking a ‘test and learn’ approach and more about building models that are relevant and fit with decision-making processes; producing reporting that displays the results of the modeling so that they can and will be used with impact.
Pilots need to be properly scalable from the start, not just prototypes or proofs of concept. By creating custom MMO pilots in this way, successful programs can then be adopted by other products or categories in the company’s portfolio and also in other markets, not stuck or siloed in one product or country. The hybrid approach of working in partnership with an expert, external service provider allows a business to validate the first run and use their experience to identify and implement improvements.
With lessons learned from the pilot in-housed MMO programs, the fourth step is to scale this new approach across the enterprise, progressively taking in more products, categories, and markets.
Because in-housing MMO represents a new way of working for many organizations, there are a number of actions you should take to set up this innovation program for success. These include:
Ekimetrics has recently published a white paper on in-housing MMO. In March 2022, our Global CEO, Jean-Baptiste Bouzige hosted a webinar on in-housing MMO in partnership with Forrester. To read the Executive Summary and download a copy of Ekimetrics’ White Paper, click here.
The third and final article in this series of articles focuses on the benefits of in-housing MMO. You can read this article here.