Unleashing the power of advanced analytics: Prophet vs. traditional Market Mix Modelling (MMM)

In today’s fast-paced business world, leveraging the right predictive models can be the key to unlocking unparalleled predictions that guide strategic decisions and enhance the bottom line. Two notable contenders in this sphere are traditional Market Mix Modeling (MMM) and Prophet. Each approach offers unique features, but understanding their differences is crucial for businesses aiming to adopt the most strategic and cost-effective methods. This article delves into the core contrasts between MMM and Prophet, providing insights into how they could impact your business decisions.

The Model: Automation vs. Manual Effort

• MMM relies heavily on human resources for the static and manual updates of its models, which are often delivered through dashboard visualisations. This traditional approach demands a significant investment in personnel and time for data analysis and model adjustments.

• Prophet, on the other hand, offers customers a customizable Software as a Service (SaaS) platform. It boasts a sophisticated neural network and an array of mathematical models to offer daily updated data feeds and re-modelling, all tailored to individual user preferences. Prophet's automation and customisation options position it as a more agile and responsive tool in dynamic market conditions.

Real-Time Data Insights: Speed of Business

• When it comes to the pace of insights, MMM operates within a 60-90 day delayed timeframe. This delay could hinder the ability to make timely decisions based on the most current market dynamics.

• In stark contrast, Prophet provides daily, near-instantaneous insights, equipping decision-makers with fresh and relevant data. This capability ensures businesses can adapt quickly to market changes, keeping them one step ahead of the competition.

Macro Data Consideration: Breadth of Analysis

• MMM takes into account a limited scope of macro data based on its 60-90 day analysis window, possibly overlooking critical trends and patterns that could influence strategic decisions.

• Prophet analyses an extensive array of over 86,000 macro data points in nearly real-time. This comprehensive approach allows for a deeper understanding of business impacts as they unfold, offering a significant advantage in strategic planning and forecasting.

Channel Performance: Direct and Indirect Impacts

• MMM’s analysis predominantly focuses on the direct impact of channel performance on revenue, potentially ignoring the nuanced effects of various marketing efforts.

• Prophet excels by evaluating both the direct and indirect effects of channels on a business’s bottom line. It connects impacts across a wide range of mediums, from billboards to digital ads, and provides granular predictions by regions, campaigns, and even individual products. This holistic view is invaluable for optimising marketing strategies and budget allocation.

Data Integration, Build, and Onboarding: Ease of Use

• The MMM model demands manual data sharing and typically involves onboarding times of 4-6+ months, which delays the implementation of insights.

• Contrastingly, Prophet promises easy integration with any data source and a swift onboarding process of 6-8 weeks, thanks to its secure API library, CSV submissions, and intelligent natural language processing capabilities. Its modular design not only streamlines marketing intelligence but also incorporates commercial intelligence aspects like pricing and loyalty, making it a more versatile tool.

Predictive Scenario Planning: Scope and Precision

• MMM is limited to media-only scenario planning based on budgets and objectives, which might not fully capture the complexity of business operations.

• Prophet, with its capability to factor in media budgets, organisational elements, and macroeconomic conditions, offers detailed financial predictions with precision down to the dollar. This comprehensive approach enables more nuanced and accurate scenario planning, driving more informed strategic decisions.

While MMM has been a staple in marketing analytics, the advent of technologies like Prophet represents a significant leap forward. Prophet’s real-time insights, comprehensive data analysis, and precise predictive scenario planning cater to today’s need for agility and depth in strategic decision-making. As businesses strive to navigate the complexities of modern markets, adopting advanced platforms like Prophet could be the key to unlocking strategic advantages and achieving cost-effective results that positively impact the bottom line.