Geo testing — the practice of isolating specific geographic regions to measure the incremental impact of advertising — has become a crucial tool for marketers needing accurate media measurement and optimization insight.
Geo testing is the optimal method to measure the incremental business lift of ad spend. Unlike traditional measurement methods, which often struggle with attribution challenges, signal loss, and an over-reliance on correlation techniques, incrementality testing provides a true causal view of media performance leading to optimized spend, refined targeting strategies, and higher ROI.
While geo-testing may seem simple on the surface, it’s important to remember that when testing media performance, you can do it quickly and cheaply, or you can favor a high-quality result that minimizes risk and maximizes confidence.
For that reason, a more sophisticated geo testing solution will offer the right balance of accuracy and flexibility. Precise measurement requires a fully prescriptive design that ensures conclusiveness and yields a robust result without sacrificing a significant portion of the business. Without this level of precision, results may be misleading, leading to poor budget allocation and ineffective strategies.
Flexibility is essential to accommodate your knowledge and context of the business you operate in. For example, market dynamics and consumer behaviors are constantly evolving, requiring marketers to refine and adjust tests accordingly. A flexible geo-testing strategy enables continuous optimization for relevant and actionable insights, while a more rigid approach ends up limiting learning opportunities. Statistical rigor and flexibility are not mutually exclusive.
Building Tests Around Reliable Parameters
There are several factors to consider when balancing flexibility and accuracy. At Measured, we design tests with several parameters. Some key ones include:
- Include or Exclude specific test or control markets
- Length of experiment
- Coverage of the hold-out
- Detectable effects
- Significance or confidence
Recommending optimal design and providing flexibility against the five parameters above, we lead with precise test designs that drive conclusive results based on our proven methodologies. Marketers get the right balance of flexibility + accuracy to ensure smarter, faster decisions. We focus on minimizing risk via an advanced market selection process that finds the most representative markets of minimal volume, while maintaining statistical integrity and offering the ability to run more concurrent tests.
As a marketer, you have a choice: You can follow Measured's best recommendations for your business or choose your own adventure by modifying any of the above parameters. For example, this could be the length of time the test should run to pick up enough data, or the minimum threshold for market size to avoid disruption to your business.
Regardless, without scientifically validated frameworks, the freedom to define your desired test cell size or the desired run length based on what’s convenient becomes a serious gamble.
A Sophisticated Approach to Synthetic Control Testing
At Measured, our geo tests are expertly designed and over 95% of them lead to conclusive, actionable results, empowering marketers to make smarter decisions with confidence so you never have to second-guess your results.
We accomplish this level of precision using state-of-the-art modeling methodologies, particularly Synthetic Control Methods (SCMs) — widely recognized as superior to other methods, including Matched-Market Tests (MMTs).
However, SCM alone is insufficient. It’s a baseline requirement for geo testing, and an important one. But it’s not unique in itself, and it’s certainly not new to the world of geo testing. For that reason, Measured goes beyond SCM to ensure the highest levels of accuracy by employing a rigorous simulation and search methodology to determine test cells based on a representative of the national total market. You can learn more about our approach to SCM here.
Don’t Choose One Approach Over Another
Let’s face it, in today’s high-stakes marketing landscape, guesswork is not a strategy. Don’t risk your budget or your results on platforms that prioritize flexibility over accuracy when you need both. Flexibility without expertise in geo testing, and without a solid foundation of data science rigor, doesn’t lead to innovation or empowerment — it leads to avoidable mistakes that can derail your marketing efforts.
If you’re ready to uplevel your geo testing practice with an industry leader, get in touch with a Measured expert today.