How Incrementality ‘measures up’ and how to get the most out of it

By: Thi Thumasathit, Head of Product – Campaigns in Product and Design (Sydney)

In our Introduction to Incrementality, we discussed the Incrementality methodology and the notion of The Would Have Seen (WHS). We continue to unravel this not -actually-that-mysterious topic and uncover what incrementality measures and how to get the most out of it.

A robust Incrementality system can help brands answer a number of important questions about the effectiveness of a digital marketing platform, including:

Incremental converters: How many more unique users converted into customers because they were exposed to campaigns on this platform?
Incremental conversion rate: How much higher is the conversion rate among users exposed to campaigns on this platform?
Incremental conversions/transactions: How many more conversions/transactions did this campaigns on this platform generate?
Incremental transaction size: Does being exposed to campaigns on this platform change the average transaction size?
Incremental revenue: How much incremental revenue was generated by campaigns on this platform?
Incremental revenue per user: How much incremental revenue per unique user does this platform generate?
Incremental gross profit: How much incremental gross profit was generated by campaigns on this platform?
Incremental gross profit per user: How much incremental gross profit per unique user does this platform generate?

“The more information a brand shares with a digital marketing platform, the more the platform’s Incrementality solution can measure.”

It is vital to note that Incrementality solutions do not work on their own. Brands should expect to coordinate heavily with their digital marketing partners to craft effective integrations within their platforms. For example, the platform knows who the brand’s WHS are, but it doesn’t know if they converted and for how much. Conversely, the brand knows all conversions and conversion values that occur on the brand’s site, but it doesn’t know who is or isn’t a WHS.

The more information a brand shares with a digital marketing platform, the more the platform’s Incrementality solution can measure. For example, a brand might not be comfortable sharing gross profit values with a digital marketing platform which is completely understandable. But then that platform’s Incrementality solution won’t be able to measure incremental gross profit or gross profit per user.

At a bare minimum, brands need to share conversions. Most leading brands also share conversion values as well- it’s not just how many users converted into customers, but when they became customers and how much they spent.

Additionally, the more timely the information is shared, the more frequently an Incrementality study can be updated. Conversion values can be shared with digital marketing platforms via:

– Javascript tags: real-time
– Back-end APIs: real-time or near real-time
– Batch file upload: the less frequent the batch file upload, the less frequently the Incrementality study can be updated
– Tracking pixels: while conversion tracking pixels are real-time, they can also be highly unreliable.

In a later post, we will discuss how to get started with Incrementality.

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