The mobile gaming industry is booming, with 3 billion players projected globally by 2029. Yet, this massive growth comes with unique challenges for marketers, including skyrocketing ad costs, stricter privacy regulations, and the increasing complexity of measuring marketing effectiveness. According to the Kochava TikTok Guide, traditional attribution models like last-touch attribution (LTA) are no longer sufficient to address these challenges. Enter next-generation Marketing Mix Modeling (MMM), a revolutionary approach designed to help marketers optimize their campaigns and future-proof their strategies.
The Growing Challenges of Gaming Marketing
As gaming evolves with technologies like augmented reality, generative AI, and Web3, the marketing landscape faces unprecedented challenges:
Rising Costs: Ad spend for mobile games is forecasted to reach $130 billion by 2025, increasing competition for visibility.
Privacy Regulations: Stricter frameworks like Apple’s AppTrackingTransparency (ATT) and Google’s Privacy Sandbox reduce the availability of user-level data, complicating attribution and targeting.
Market Saturation: With more games entering the market, standing out has become increasingly difficult, making effective budget allocation critical.
Traditional methods like LTA fail to capture the nuanced contributions of various channels, often leading to under- or over-investment in critical areas.
Why Last-Touch Attribution Falls Short
LTA simplifies attribution by crediting 100% of a conversion to the final touchpoint, ignoring earlier interactions in the customer journey. This model creates significant blind spots, particularly for upper-funnel activities like brand awareness campaigns or platforms like TikTok, which play crucial roles in driving early engagement.
The Rise of Next-Gen Marketing Mix Modeling
Marketing Mix Modeling (MMM) isn’t new, but its next-generation iteration is redefining how marketers analyze and optimize their campaigns. Unlike traditional MMM, which was slow and retrospective, next-gen MMM is dynamic, delivering actionable, real-time insights. Here’s what makes it revolutionary:
Real-Time Insights: Next-gen MMM integrates seamlessly with existing platforms like Kochava’s AIM, enabling marketers to plug in their MMP (Mobile Measurement Partner) data and receive actionable recommendations in real time.
Privacy-First Approach: By relying on aggregated, market-level data instead of user-specific data, next-gen MMM remains compliant with evolving privacy regulations.
Holistic Channel Analysis: It evaluates the full customer journey, capturing contributions from upper-funnel activities, offline media, and cross-channel interplay.
Optimized Budget Allocation: By analyzing cost curves, next-gen MMM identifies the point of diminishing returns, helping marketers decide where to increase, decrease, or maintain spend.
Case Study: TikTok Under-Attribution Solved
In one example highlighted in the Kochava TikTok Guide, a gaming marketer faced a critical challenge with under-attribution using traditional LTA. TikTok’s ad campaigns were driving significant user engagement, but the LTA model only credited TikTok with 44 Day 7 revenue events per day. Suspecting this figure was inaccurate, the marketer onboarded a next-gen MMM platform.
Using the MMM platform, the marketer integrated their MMP data to analyze cost curves and calculate the true incrementality of each channel. The results were eye-opening: TikTok’s contribution was nearly double what LTA reported, with the MMM model attributing 82 Day 7 revenue events per day. This analysis revealed that TikTok was a far more valuable channel than previously thought.
The marketer leveraged these insights to adjust their budget allocation, increasing spend on TikTok while scaling back on less effective channels. The MMM platform also highlighted the point of diminishing returns for TikTok, ensuring the additional investment was maximized without overspending. This data-driven approach not only improved ROAS but also provided a more accurate, holistic view of campaign performance.
Key Benefits of Next-Gen MMM Over LTA
| Aspect | Last-Touch Attribution (LTA) | Next-Gen MMM |
|---|---|---|
| Customer Journey | Simplifies the journey to a single touchpoint | Captures the entire customer journey |
| Upper-Funnel Activities | Overlooks brand awareness and early engagements | Measures the impact of all funnel stages |
| Channel Interplay | Ignores how channels influence each other | Models direct and indirect effects across channels |
| Privacy Compliance | Relies on user-level data | Uses aggregated, privacy-first data |
| Optimization | Focuses on bottom-funnel activities | Identifies saturation points and reallocates spend |
By addressing these shortcomings, next-gen MMM provides a balanced and accurate understanding of campaign performance.
Is Next-Gen MMM Right for You?
Not every organization is ready to adopt next-gen MMM, but it’s a game-changer for those that fit the profile. Here’s a checklist to see if MMM is right for you:
Ad Spend: Your organization spends $160,000+ monthly per geo region on ads.
Historical Data: You have access to at least 12 months of historical in-app event and ad spend data.
Media Partners: Your media mix includes diverse channels, avoiding over-reliance on a single partner.
Testing and Innovation: Your team is open to adopting new technologies and challenging existing assumptions.
If you check most of these boxes, next-gen MMM could be the key to unlocking higher ROAS and long-term growth.
Future-Proofing Your Marketing Strategy
As highlighted in PocketGamer.biz’s gaming growth guide, the ability to adapt and innovate is critical for success in 2025 and beyond. Next-gen MMM offers a future-proof solution for marketers looking to navigate the complexities of today’s advertising landscape. By combining MMM’s holistic insights with LTA’s granular data, you can strike the perfect balance between strategic and tactical decision-making.
