Course 4 / Lesson 4
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Incrementality Testing Basics

What Is Incrementality Testing?

Incrementality Testing is a proven experimental approach for measuring the incremental contribution of media. Tests are executed by systematically withholding ad exposure to a representative subset, or “cohort,” of the target audience (the control group) while maintaining normal ad exposure to the broader audience set (the test group). As long as the control group is selected at random and sizable enough to be statistically significant, then the incremental contribution of the media can be determined by the difference in performance results (conversion, revenue, profitability, etc.) between the test and control groups.

Incrementality testing is often used interchangeably with lift testing, uplift modeling, or A/B testing but this is actually inaccurate.

Definitions:

  • “Incrementality” is the portion of last touch conversions that were truly driven by a media channel or tactic.
  • “Lift” is typically higher than incrementality, because it indicates the total number of conversions that the incremental contributions add up to.

Why Is Incrementality Testing Needed?

In order to optimize media investments, marketers need to know how much each media channel or tactic is contributing to results and how much is being wasted. For years multi-touch attribution promised to deliver accurate insights, beyond last touch metrics, to help marketers understand how much each marketing touchpoint contributed to a resulting conversion, but it was expensive and difficult to implement. Walled gardens, privacy regulations, and the increasing limitations being put on third-party data use have now rendered user level attribution next to impossible.

On their own, individual reports from publishers are useful for targeting optimization, but combined with controlled experiments they can reveal accurate insight into causality and incrementality, arming marketers with the data to make informed decisions, based on science. Plus, they don’t require any cookie syncing or sharing identity with third parties.

About Measured
Measured helps brands grow by measuring incremental media contribution to maximize performance results. Through a transparent experimentation approach that is always learning, Measured delivers ongoing actionable insights for marketers to increase efficiency and scale media for maximum growth. Experiments are powered by Measured’s privacy compliant Marketing Data Warehouse, which is purpose-built for analytics with data the customer owns. For more information, visit www.measured.com.

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Course 4 / Lesson 5

Incrementality and Customer Lifetime Value