Incremental lift analyzes how much impact your marketing campaigns have on your sales revenue. In other words, how do you attribute your marketing efforts to your business success? How can you demonstrate the impact that marketing has to capture new customers? Would you have acquired them without a specific marketing campaign?
These are the questions every business is asking.
However, answering these questions is becoming more complicated by the day. Brands must overcome challenges like third-party cookie deprecation and rising data privacy concerns and regulations. There are also numerous online and offline marketing channels that each house their own measurement.
Bringing all your marketing data together and attributing your efforts accurately to sales can be difficult, but it’s still possible. At Goodway Group, we help businesses identify the precise amount of lift marketing channels that are contributing to sales outcomes.
Defining Incremental Lift
If you shut off your advertising campaign tomorrow, customers might still make purchases. But how much more would they have made had the campaign been live? This “more” is called incremental lift – what happens when all else is held constant and something changes in response to a stimulus.
In other words, incrementality measurement lets you understand the true impact your marketing strategies have on a customer’s decision to purchase.
Understanding Incremental Lift Tests
In marketing, you may be familiar with a control vs. exposed lift study. Historically at Goodway, we’ve also run two types of incremental lift studies: geo holdout tests and ghost bidding tests. Those sound like a mouthful, but we’ll break them down.
Control vs. Exposed Lift Study
This lift study is the gold standard in public health. For example, a portion of your target audience receives an ad, while the other doesn’t.
How it’s done: To run a control vs. exposed lift study, you identify the KPI you hope to measure. Then, find two populations that have performed similarly historically with that KPI.
You execute the test by either:
- Removing an existing factor that both groups have been exposed to.
- Adding a new factor to only one group and keeping all other factors the same.
The difference between these two groups would be your incremental lift.
Geo Holdout Tests
Using Skai, one of our omnichannel marketing platform partners, we create geo holdout tests. These incrementality tests can reveal insights like:
- Whether your ads contribute to revenue.
- If you could get the same results without spending more.
How it’s done: Geo holdout tests compare two geographies that have historically performed similarly. We either turn on or turn off the channel we’re testing in only one of those markets.
Then, we measure the difference between the two in the KPI we’re measuring (i.e., sales) during that time. Again, this is the incremental lift.
Ghost Bidding Tests
With The Trade Desk (TTD), we can run ghost bidding tests. These tests can reveal if your ads are effective at increasing conversion rates. It’s a cost-effective way to run a control group study.
How it’s done: Ghost bidding tests withhold an ad at the last minute, so it’s not served to an individual who would’ve normally seen it. The incremental lift is the difference between the users served an ad vs. those not served an ad.
There are other ways to execute an incremental lift test, but these methods are the most common at Goodway.
Choosing the Right Lift Study
Lift studies help brands go beyond looking at basic metrics like click-through rates. Instead, you get actionable insights and measure the real impact of your ad campaigns.
Choosing the right lift study can help you identify why your campaigns are successful and how to replicate them for future campaigns.
Determine Your Ultimate Goal
The goal you choose will guide all your measurement decisions. To set your goal, ask: What is it you want to do? You may want to focus your goals on increasing metrics like:
- Foot traffic
- Trial rates
Your goal should also be realistic and measurable. Some of these will be easier to measure than others. If you select sales, you could measure lift by looking at how much revenue or the average order value has increased. However, measuring awareness might be a little more difficult. All your advertising efforts should contribute to your goals.
Executing a Lift Study
Understanding incremental lift requires a strict scientific method approach to determine direct cause and effect. The scientific method follows five main steps: Observe, hypothesize, test, implement and repeat.
Let’s look at each in more detail:
- Observe a desired outcome.
- Hypothesize the impact a stimulus will make.
- Test two randomly selected samples — one with the stimulus and the other without — then confirm or deny the hypothesis.
- Implement the results into strategic, budget or optimization decisions.
- Repeat since the quest for better results never ends.
Following each step will help you measure incremental lift accurately and repeat your results.
Growing a Retailer’s Presence and Driving Online Sales
Incremental lift can be hard to wrap your head around without testing it out for yourself or looking at real-life examples. Here’s a case study of how we measured incremental lift for a leading mattress retailer.
Our client wanted to attract new high-value customers and grow awareness. They also wanted to know the effectiveness of advertising efforts on online sales.
We used a suite of cross-channel measurement solutions to examine the entire customer journey from upper-funnel media exposure to on-site purchase. Going beyond last-touch attribution, we tracked the incremental lift of programmatic video and connected TV added to display advertising campaigns.
We seamlessly created exposed vs. control groups without wasting the budget.
When CTV or programmatic video preceded display advertising in the consumer journey, we observed a 7x lift in revenue per exposed user.
We found a 12.1% lift in display advertising, and a 17.4% lift in native advertising – totaling more than a 29% lift in combined channels. In other words, we directly correlated digital media spend to the customer purchase decision.
Accelerating a Client’s Customer Acquisition
Another client of ours, a baby nutritional product line, wanted to make informed decisions about its media mix and budget allocation.
Using Amazon Marketing Cloud, we found the purchase rate was 3x higher when customers were exposed to both display and Sponsored Product ads than Sponsored Product ads alone. It was 13x higher when customers were exposed to both prospecting and remarketing ads than remarketing alone.
Embracing the Science of Marketing
Conducting incrementality tests and measuring lift enables brands to determine the effectiveness of a new message, channel, media type or launch. It also helps you identify when campaigns are successful, pinpoint the factors that contribute to success and decide where to invest incremental funds.
Reach out to us to learn more about incrementality and measurement solutions. We can help you implement a lift study on your next campaign so you can clearly see the impact you’re making and confidently share the results with your C-suite. We can also help you answer key business questions with solutions such as media mix modeling and multi-touch attribution models to identify actionable insights to drive tangible outcomes.