Incrementality testing is a game-changing measurement approach for marketers. In the ever-evolving marketing landscape, this method holds the key to smarter decision-making, better allocation of resources, and, ultimately, greater ROI. Our most recent report, Testing, Testing: Use Incrementality Tests To Lift Your Marketing ROI, has best practices to get started with building an incrementality testing strategy.
What Is Incrementality Testing?
Incrementality testing is a powerful method for determining the true impact of your marketing efforts. Rather than merely measuring the overall performance of your campaigns, incrementality testing focuses on understanding the incremental lift, or the change in behavior, directly attributed to your marketing activities. It helps you answer the fundamental question: “Did my marketing campaign make a difference, or would the same outcome have occurred without it?”
Why Should You Conduct Incrementality Tests?
Incrementality testing is most effective when used to measure the uplift that marketing initiatives have on the business. It adds the most value in the following scenarios:
- New campaign/channel/tactic launches. When introducing a new marketing campaign, you’ll want to assess its impact on conversions, customer acquisition, and other relevant KPIs.
- Budget allocation. Before allocating your marketing budget, consider incrementality testing to determine which channels or strategies drive the most incremental value.
- Inaugural market entry. When your brand enters into a new market, launch incrementality tests to determine the right channels, programs, and tactics that drive short-term conversions.
- Ongoing optimization. Regularly evaluating the incremental impact of your marketing activities can help fine-tune your strategies over time, leading to continuous improvement.
How To Master The Art Of Incrementality Testing In Marketing
Implementing incrementality testing can be quite challenging. It involves the intricate process of configuring test cells, rigorously establishing causality with statistical precision, and executing replicable tests. Marketers should consider incrementality testing best practices to ensure confidence in the results. For starters, setting up a clear hypothesis will help identify the target audience as well as expected results. Marketers should also consider working with their data science teams to create test parameters, establish testing duration, and help with creating the desired approach. Once these pre-testing steps are taken, it will also be important to document and replicate the testing results in order to try to establish a stronger statistical significance.
To learn more about the right testing strategies for your specific needs and objectives, request a guidance session with me.