MMO: key considerations before you go in-house Executive Summary

Executive summary report on a recent Ekimetrics webinar, run in partnership with ForresterTo mark the launch of its new white paper titled “Marketing Measurement & Optimization: in-house, outsourced, or hybrid?”, Ekimetrics, a global leader in data science held a webinar featuring global market research company, Forrester. The presenters were Ekimetrics’ Founder & CEO, Jean-Baptise Bouzige, and guest speaker Tina Moffett, Principal Analyst, B2C Marketing, at Forrester. This article summarizes their joint discussion.

Setting the scene

Jean-Baptiste introduced the session by setting the context. Ekimetrics is increasingly working with big multi-national and global businesses who are looking to bring some or many elements of their Marketing Measurement and Optimization (MMO) in-house. In part, this is being driven by the overarching imperative for digital transformation across different functions in many businesses, not just marketing. This means that companies are beginning to address the challenges of data acquisition and management, building analytics assets, and developing teams of data experts to better measure performance. In turn, this requires them to face up to the key choices they need to make in terms of what should be in-housed and what delivered by expert, external partners.The rationale for in-housing – at least in part – is to secure better control of data, greater transparency and privacy, and quicker, more varied measurement. In-housing MMO is not a simple question. It’s not a “once-and-done” destination; it’s very much more of an ongoing journey.

The data behind the decisions

Tina reported on the findings from recent Forrester research reports which further scope accelerated interest and activity in this area. In-housing in marketing services is not a new concept, and several core strategic functions are already in-sourced in full or delivered in a hybrid arrangement, part in-housed, part outsourced. These include analytics, media, insight, and advertising technology, although media buying and advertising operations are rarely in-housed. Until recently, the same was true of MMO, as it is more usual for vendors to have the data, algorithms, and technology required to deliver precise MMO analyses. These vendors also typically have more time and market context, and building an in-house engine to drive MMO often takes time and serious resources.Forrester’s 2022 Global Marketing Survey of almost 800 business-to-consumer marketers found that 29% of companies currently in-source their MMO and analytics completely, managing the data, tech, and algorithms with in-housed manpower ingesting, managing, and manipulating marketing data. The motivations are made real by this comment from Rob Roy, the former CDO at Sprint/T-Mobile, in Forrester’s The Brands Guide to In-housing Media:

We wanted to own our own destiny, to harness our data – how to use it, how to control it, keep it private – then we could do things with it that made business sense.

B2C marketers’ number one priority, reported by 25% of Forrester’s Global Marketing Survey sample, is improving ROI. Routinely, however, they’re held back by data challenges, lack of relevant tech resources, and not having the right people in place. Together, this inhibits successful marketing measurement strategies. Their number two priority (reported by 24%) is to improve alignment and collaboration with other departments, underpinned by a desire to incorporate other functions’ data into their increasingly business-relevant models.The increasing rate of change in the digital marketing ecosystem is also an ever-present challenge for marketers, as is inconsistent data quality, a problem that will only be exacerbated by the imminent deprecation of third-party cookies. For successful MMO, data needs to be precise, complete, and comprehensive. 19% of Forrester’s sample also report that marketing data materializes too fast for them to manage.By contrast to the 29% of marketers who in-house everything, just 13% of marketers plan to completely outsource marketing measurement in 2022. Tina reported that those outsourcing entirely tend to be medium-sized businesses with less experience of MMO, often lacking the budget to build a robust analytics function in-house.

Finding the right people

Getting the right people with the right skills is one of the main drags on companies successfully moving even to a partially in-housed, hybrid model of MMO. Forrester have found that:

• 31% of companies say they have team members in marketing departments that have the right skillsets for marketing analytics and measurement
• 25% say they plan to train existing employees, and in this way make the marketing department more data savvy
• 27% plan to hire new employees with measurement skillsets – what Forrester considers to be “unicorns”, those with a balanced portfolio of both marketing and analytics abilities
• Meantime, 18% plan to find measurement skillsets within other roles in the organisation. These individuals could come from finance or advanced analytics, and it makes sense to bring these functions closer to marketing in order to grow MMO capabilities

Three possible directions of travel

Jean-Baptiste reported that many companies that start on the journey towards in-housing some aspects of MMO come to Ekimetrics with apparently simple questions – about breaking down silos or better integrating data sources across the company. What they soon discover is that they have only identified part of the challenge. In-housing is not an end in itself, it is not the same for all businesses, and it is very much a journey and not a destination. Done right, it starts with “Why?” – understanding and articulating both the purpose and the anticipated benefits of in-housing.

In essence, there are three possible models for in-housing MMO:

1. In-housing led
2. Hybrid, where some core functions (data, objectives and goals) are moved brand-side while others (modelling and tech) remain delivered best by external third parties. Paradoxically, taking this approach gives marketers greater access to their partners’ expertise while at the same time brand teams learn more about measurement, data, and analytical processes
3. Partner-led

Before deciding on the right approach, the first step is for brands to determine their data maturity; to assess how well they currently incorporate cross-functional insights and build marketing measurement efforts directly into explaining marketing’s value to the business. By doing this, brands can pinpoint what they should bring in-house and what they can rely on their partners to deliver. Some businesses are beginners, others are advanced, but most are intermediate, with a bias either towards tech (so they’re capabilities-driven) or insights (and so they’re business-driven).

Depending on their relevant level of data maturity, businesses can either develop in-housed MMO either (a) at a relatively surface level but across multiple markets and brands, or (b) in great depth but just for top tier markets and brands. Industrializing at scale for type (a) companies means analyzing more marketing levers in greater depth, while for type (b) companies it means expanding the in-depth analysis across more markets and brands. Most businesses on the in-housing journey find that they tend to bump and weave between these two positions.

Summing up

Tina concluded that there are three factors required to make the hybrid approach to in-housing MMO really work.

1. Establish the vision and plan. Build the business case and demonstrate the benefits of the hybrid MMO model to the operation. With marketers upskilling, these skillsets can be transferred to other functions and different data-related projects.
2. Build baseline internal and external components. Internalizing expertise and forging stronger partnerships with external specialists enable businesses to realize the potential of their chosen approach and strategy. In so doing, it’s critical establish guardrails and detail the scope of work with all partners and minimize scope creep. Transition plans need to detail – precisely – who’s responsible for what, including recruiting, training, and assigning tasks across the team, both inside and outside the marketing function.

3. Scale and manage the operation. Go beyond what you’re used to measuring and demonstrate the strategic and financial value of your new measurement expertise to the C-suite.

In all of this process of transition, Jean-Baptiste and Tina were of one mind that it’s critical not to focus too much on tech or tools – “That can make you lose your compass!” said Jean-Baptiste. It is very easy to become distracted by ‘shiny new objects’ to measure one aspect of MMO. Instead, it’s vital to remember that tools are just one piece of the puzzle but never the complete puzzle. By always asking “Why?” and “What problem am I trying to solve?” you can focus on the journey and not the components parts required to take you on that journey.Tina concluded: “It all starts with an honest assessment of where you are so that you can determine what the right hybrid model should be. Otherwise, everything will break.”For Jean-Baptiste, flexibility is crucial: “There is no single journey. You really have to build your own map, based on your data maturity, your purpose, and your goals.”To find out more, read our white paper on In-Housing MMO here and discover:

1. Where to start
2. What’s involved
3. And the benefits!