Magic Quadrant for Marketing Mix Modeling Solutions

Context

• A tremendous increase in macroeconomic and business volatility affects both marketing results and planning. This increases the value of high-quality MMM scenario planning and other solutions that address enterprisewide challenges.
• An enterprise focus on short-term priorities, in reaction to macro volatility, challenges marketers focused on brand and other longer-term (or intangible) impacts. This increases the importance of demonstrable and explainable marketing investment benefits.
• An “Era of Less” persists, as postpandemic marketing budgets are less than three-quarters of prepandemic levels. As budgets stayed flat in 2025, CMOs have chosen to allocate more of their budgets to paid media, increasing the need to show returns.

• Planning for volatility — Scenario planning capabilities make volatility something to plan for instead of something to be impacted by. MMM helps CMOs explore the changes in macroeconomic policy, weather variability, advertising creative, competitive tactics and marketing strategy, media plans, and distribution management needed to maximize sales or profits in each scenario. Sophisticated tools can identify the most likely scenarios based on trends. And vendors with extensive benchmark databases can estimate the impact of factors the business hasn’t encountered before.
• Counteracting a short-term focus — The ability to distinguish between the short- and long-term effects of marketing helps CMOs mitigate the risks of a short-term focus. While there are multiple ways to calculate impact, CMOs should ensure their MMM vendor’s software clearly distinguishes between the two, and that the vendor executes a collaborative and comprehensive model development plan (see Case Study: Gain Buy-In for MMM Adoption Using Model Co-Creation for a successful approach).
• Managing budget and expectations — The Era of Less demands that CMOs (1) set clear expectations with the C-suite about the limits of marketing’s effectiveness in a volatile environment, and (2) maximize the impact of their budget, including media dollars. MMM can help CMOs do both. For example, if macroeconomic conditions cause sales to decline, even as marketing performance improves, CMOs can use MMM driver analysis to explain why. They might also use MMM scenario planning to predict depressed sales in 2Q but not 3Q, allowing them to manage C-suite expectations and perhaps shift marketing budget from 2Q to 3Q. MMM optimization calculators can also recommend media budget allocations to achieve a specific goal (e.g., a revenue target) in the context of unique constraints (e.g., a media contract that requires 30 days’ notice and a fee to cancel).