Refresh the model

How to refresh your model and how often depends on the data frequency (such as daily or weekly) and in what timeframe the marketing team makes decisions. If decisions are quarterly, we recommend running the model each quarter. The data window can be expanded each time, so that the older data still has an influence on the most recent estimate.

Consider the following:

  • Meridian doesn't model media effectiveness as time-varying. So, the decision to discard old data versus append new data is a bias-variance trade-off. Appending the new data reduces variance because you have more data, and this can increase bias if media effectiveness and strategies have changed drastically over time.

  • Appending a small amount of data can have a big effect on results because, in general, MMM estimates are high-variance.

  • When you append new data, you can set the priors so that they match the posterior for results before the appended data. This action encourages the old results to match the new results, and there can be valid business reasons for doing this. We recommend that you set priors based on prior knowledge and intuition, and it is perfectly valid for this intuition to be informed by past MMM results. It is your decision as to how strongly you want past MMM results to inform your prior knowledge and intuition. However, consider that setting priors that match a previous MMM's results effectively counts the previous data twice.