Contribution Charts

The Contribution Charts session in the MMM Advanced Workshop teaches participants how to convert model outputs into clear visuals that show how each marketing factor contributes to outcomes like total sales. These charts help both technical and non-technical stakeholders understand and act on model results.

Key topics covered in this session include:

1. What is a Contribution Chart

   • A tool to break down total outcomes (like sales) into parts attributed to different marketing drivers such as media, pricing, and promotions.

2. Absolute vs. Non-Absolute Contribution Methods

   • Absolute Contribution Charts: Assume a fixed total (e.g., 100 units of sales). Each variable is allocated a share of this total. Negative effects are included but the overall total stays fixed.

     • Example: TV = 32 units, Promo = 20 units, Price = –2 units, Total = 100 units

   • Non-Absolute Contribution Charts: Allow for the total to exceed or fall below a base level. Negative contributions are shown explicitly, making it more realistic.

     • Example: TV = 52 units, Promo = 40 units, Price = –30 units, Total = 162 units

3. Key Interpretations

   • Negative values like price increases can reduce overall contribution.

   • Non-absolute charts are more realistic when negative effects are strong.

   • High-performing media should reflect higher contributions.

   • Charts must be clear and accurate for business presentations.

4. Hands-on Calculation in Excel

   • Contributions are calculated using the formula:
     Contribution = Coefficient × Input Value

   • These values are then scaled or normalized to build the final chart.

By the end of the session, participants will be able to:

• Understand the difference between contribution chart types.

• Build contribution charts using MMM model outputs.

• Present results clearly to non-technical stakeholders.

• Align contribution insights with business decisions like budgeting and media planning.