New Outcome-Based Marketing 2.0 research shows targeting the “movable middles” improves return on ad spend by 50%, attracts more non-buyers, and increases penetration across all brand buying groups
MMA Global has introduced a new marketing growth strategy and research initiative dubbed Outcome-Based Marketing 2.0 (OBM2). Through initial research, this model outperformed traditional reach-based marketing plans by more than 50% on return on ad spend (ROAS). OBM2 represents a major step forward in validating how marketing organizations can achieve profitable growth through responsive audiences for their respective brands in today’s rapidly changing marketing world.
In the current economic climate, marketers are under pressure to deliver marketing plans that are better aligned to business growth. The Outcome-Based Marketing 2.0 strategy enables brands to align budgets, channel allocation, and audience targeting directly with ROAS tied to consumers who are more likely to respond to and be impacted by a brand’s advertising. This groundbreaking new approach is based on scientific validation for a more targeted method with significantly better performance to brand growth, refuting the decades-old reach-based plans that may be good for broad exposure but are more wasteful and less efficient in reaching interested buyers.
MMA found that a marketing campaign organized around the most responsive target audience for a brand – dubbed the “movable middles” — will yield far better outcomes than traditional media plans optimized for reach. Movable middles are defined by having a mid-range probability of buying an advertised brand; they are proven mathematically to have five times the responsiveness to that brand’s advertising. They are unique to each brand. While they overlap somewhat with heavy buyers, they also include medium, light, and non-buyers. This helps marketers not only achieve good returns, but also expose their brand to a larger group of receptive consumers for long-term growth.
In this first proof-of-concept study, MMA and Neustar deployed agent-based simulation methodology to target the movable middles on behalf of a brand of frozen pizza in the U.S. market. The analysis proved:
- An Outcome-Based Marketing 2.0 plan optimized to target the movable middles outperforms a traditional reach plan by more than 50% on ROAS
- Targeting the movable middles helps marketers increase marketing outcomes across the board versus traditional reach-based approaches, including attracting more non-buyers, increasing total consumer reach, and increasing buyer-penetration across light, medium, and heavy buying groups
- Movable middles can be predicted with 99% accuracy for each brand, regardless of industry vertical
Additional categories, including detergents, nutrition bars, and margarine, will be run through the same analysis in the coming months. The MMA has raised funds and expects to validate this planning approach in real-world, in-market experiments that will last a full year called “Brand as Performance.”