How to Build a Framework for Incrementality in Marketing

On the surface level, your campaign looks like a well-oiled machine. The cogs are turning smoothly, and the numbers look pretty solid. The CTRs are healthy, CPAs are manageable, and the ROAS is trending upward.

Every piece seems to be spinning in perfect sync. But is the campaign actually driving more conversions, or would they have happened anyway?

Incrementality testing answers this question with utmost precision. It shows you whether your marketing campaign truly has a real, tangible impact. In this article, we’ll show you how to measure incrementality in marketing and how to set up an incrementality framework.

Key Takeaways:

• Incrementality in marketing helps you understand whether your marketing efforts are driving conversions. It answers the question, “Would these customers have converted if I didn’t run this campaign?”
• An incrementality test helps you quantify the actual impact of a marketing activity and shows you whether the activity has a positive, negative, or neutral effect, and by how much.
• Utilizing specialized tools like RedTrack can help you create a robust incrementality testing framework through cross-channel tracking, advanced segmentation, and privacy compliance.

What Is Incrementality in Marketing?

Marketing incrementality is the impact on sales or conversions driven by a certain marketing activity over a particular period.

It’s the added value from your marketing efforts beyond what would have happened without these efforts.

But don’t conventional metrics show that? Metrics like clicks and conversions tell you what happened. Incrementality marketing tells you why it happened and whether your campaign was behind it.

For example, let’s say a customer in your target market completes a purchase from your online store after seeing a social media ad. You could conclude that your campaign directly impacted this conversion. But what if they were already going to buy from you, with or without the ad? Then the ad didn’t incrementally drive the conversion.

Even as data access and tracking capabilities evolve, it’s getting harder to determine which campaigns are genuinely driving new customers and sales. Ultimately, this means that measuring incrementality is important. It lets you isolate true campaign impact and avoid wasted spend. This matters a lot, especially keeping in mind the decline of third-party cookies and the fact that privacy laws are getting stricter.

Attribution vs Incrementality: What’s The Difference?

Essentially, these two terms aren’t the same. Here’s a brief overview comparing incrementality vs attribution.

• Attribution credits the appropriate marketing channel, strategy, or campaign that led to a conversion. Marketing attribution is achieved through one or more methods like first-touch, last-touch, or multi-touch attribution (MTA). But attribution is limited to just measuring clicks.
• Incrementality marketing isolates and quantifies the true impact of a strategy, channel, or campaign by comparing it to a control group or baseline scenario. It allows you to measure the impressions and clicks in each channel or campaign, giving you a more accurate insight into the true contribution of your marketing efforts. It also answers the question: “What would have happened without this marketing activity?”

How to Measure Incrementality in Marketing [3 Core Metrics]

To quantify the incremental impact of your marketing efforts and isolate the true causal effect of your campaigns, you’ll need to go beyond surface-level metrics. As such, you can leverage these crucial metrics.

Incremental Conversions

This is the number of conversions that can be directly attributed to your marketing efforts. It’s calculated by determining the difference between conversions from the test group and conversions from the control group.

Incremental Revenue

This metric measures the extra revenue generated directly from your marketing activity, beyond what could have occurred organically. It’s calculated by getting the difference between revenue from the test group and revenue from the control group.

Lift (%)

This is the percentage increase in conversions due to your campaign. You can calculate it by dividing the incremental conversions by the control group conversions and multiplying the result by 100.

Benefits of Using an Incrementality Framework

The incrementality framework moves away from granular user-level and attribution data and embraces a more causality-focused and aggregated way of measuring marketing efforts. Here are the key benefits of adopting the incrementality testing approach.

• Precise measurement of true impact — Instead of assuming your campaign was effective because conversions happened, the incrementality framework helps you identify what actually caused those conversions. This helps you avoid over-crediting high-visibility channels or retargeting that won’t drive new results.
• Better budget allocation — With a bigger picture of what drives incremental performance, you can reallocate your budget to high-impact campaigns and channels. You won’t have to drain your budget on tactics that appear effective but don’t actually drive meaningful and measurable results.
• Clearer, more actionable ROI — Incrementality helps you quantify how much additional revenue and conversions your campaigns drive. This gives you a more accurate picture of your return on ad spend (ROAS) and the pay off of other expenses.
• Cross-channel and cross-campaign insights — When deployed across campaigns, the incrementality framework gives you insights into how different channels interact, including where there’s synergy, overlap, and cannibalization. This gives you a holistic overview of performance across the entire funnel, leading to more strategic media planning and smarter sequencing.
• Privacy compliance — Data-privacy regulations (like GDPR and CCPA), depreciation of third-party cookies, and increased limitations of tracking across platforms (like iOS updates) make it more difficult for marketers to view user journeys. But incrementality testing offers a privacy-first way to assess effectiveness through anonymized or aggregated data.

What Is Incrementality Testing?

An incrementality test is a controlled, randomized experiment that quantifies the actual impact of a marketing activity. It shows whether the activity has a positive, negative, or neutral effect, and by how much.

Incrementality testing in marketing involves splitting your audience into control and test groups and comparing them based on revenue and conversions. The difference between them gives you the incremental lift driven by your marketing efforts.

Suppose your business launches a new product, and your marketing team is trying to evaluate whether to invest more in your Facebook ads. Incrementality testing marketing can help you decide if this campaign will drive the desired outcome.

What Do You Need for Incrementality Testing?

To run a reliable incrementality test, you need to set up the right structures, isolate the impact of your efforts, and access quantitative data. These are the key elements to run incrementality experiments.

Baseline

Before you measure lift, you need a benchmark for “normal” results in the absence of your marketing effort. That’s your baseline. The results could be average revenue, conversions, or user engagement over a specific period or from a similar audience.

A baseline allows you to detect meaningful changes and determine whether your efforts drive those changes.

Control and Test Groups

The core of your marketing incrementality test is the division between:

• Control Groups — The audience that is not exposed to the ads. Serves as the baseline for comparison
• Test Groups — The audience that is exposed to the ads. Used to measure the causal impact of your marketing activity

To maintain a fair comparison, both groups should be similar in size, behavior, and demographics. The difference between the groups reveals your incremental lift.

You can segment your audience randomly, by region (geo-testing), or by customer list, depending on your business model and platform.

Campaign Environments

Your campaign environment needs to remain stable throughout the test period if you want incrementality marketing to generate valuable insights. This means avoiding other overlapping promotions, major creative changes, or significant shifts in targeting that could influence the results.

Keep the following factors consistent:

• audience criteria and targeting rules;
• creative assets and messaging;
• budget and bidding strategy.

The cleaner the environment, the more confident you’ll be in the test results. Observe this for at least seven days before and after the incrementality test.

How to Run an Incrementality Test in 5 Steps

Running an incrementality test involves more than just comparing numbers. It’s about leveraging data to uncover the real impact of your efforts. Here’s a step-by-step guide to conducting an incrementality test.

Step 1: Define Your Objectives and KPIs

Start your incrementality test by defining what you want to achieve with your campaign. You might find a lift in conversions, but did you get a positive ROI? And did your target audience really convert? Your goals will guide your incrementality measurement strategy and remove all the guesswork.

Set the right goals and KPIs to ensure your marketing incrementality test focuses on real impact, not misleading vanity metrics. You may want to concentrate on these KPIs:

• awareness;
• downloads;
• purchases;
• form fills;
• sign-ups;
• trial rates.

Ideally, your KPIs should be SMART (Specific, Measurable, Achievable, Relevant, and Time-bound). Some of them will be easier to measure than others.

For example, if you want to track sales, you could measure lift by evaluating how much the revenue or average order value has increased. On the other hand, measuring awareness is difficult.

Step 2: Launch the Campaign

Deploy your marketing campaign as planned. Whether it’s a new paid ad campaign, email workflow, retargeting strategy, or platform-specific activation, be sure to target only the test group and exclude your control group from any exposure to the campaign.

Monitor external factors like seasonal trends and customer behavior shifts that can skew your test results. For example, if you run an e-commerce gift shop, sales might spike during the holiday season. But how many of those conversions are actually from your campaign and not due to holiday shopping trends?

If you don’t account for these external factors, you risk overestimating your incremental lift and making budget decisions based on misleading numbers. To avoid that, you can use:

• comprehensive ad tracking software;
• platform-native lift testing tools (like Meta Conversion Lift or Google Ghost Ads);
• customer relationship management (CRM) software to monitor group responses in real time.

Step 3: Collect Data

Track conversions from both your control and test groups. Note the number of users in each group, revenue per user, and overall revenue. Ensure that every data point is accurately attributed to the relevant group in your tracking framework.

If you notice a wide margin between your control and test group results, it could mean that something is wrong with your test configuration. In this case, you might want to retest.

Let the campaign run long enough to collect statistically meaningful data. Two to four weeks is ideal for short campaigns, while longer ones require several months, depending on volume and traffic.

Step 4: Use Your Results to Measure Incrementality

While it’s nice to have a tool that will do all the heavy lifting for you, it’s smart to understand how to crunch the numbers on the fly. Here are a few ways how to evaluate whether your campaign was successful and by how much.

1. Calculate Conversion Rates

Start by determining the conversion rates for both your control and test groups. Here’s the formula:

Conversion Rate = (Number of Conversions ÷ Number of Users) ⨉ 100

For example, if your test group has 1,500 users and 150 conversions, the conversion rate is 10%. If the control group has 1,500 users and 120 conversions, the conversion rate is 8%.

2. Determine the Absolute Difference

Now, get the difference between the two conversion rates using the formula below:

Absolute Difference = Test Group Conversion Rate − Control Group Conversion Rate

Using our example:

10% (test group) − 8% (control group) = 2%

This 2% is the raw lift in conversions due to your marketing efforts.

3. Find the Incremental Lift

Finally, calculate the incremental lift, which is the percentage increase in conversions. Here’s the formula:

Incremental Lift (%) = (Absolute Difference ÷ Control Group Conversion Rate) ⨉ 100

In this case:

(2% ÷ 8%) ⨉ 100 = 25% Incremental Lift

This means your campaign increased conversions by 25% over what would have occurred without it.

Step 5: Analyze Incrementality Testing Data

You’re now ready to turn the data into results. Expand or maintain your efforts if the test calculations reveal a positive incremental lift. Experiment with targeting, creative, budget, or timing adjustments if negative.

Compare the incremental revenue to the campaign spend to see if the campaign is ROI-positive. If you’re spending $7,000 and only generating $5,000 in incremental revenue, the campaign may not be worth pursuing in its current form.

Also, break down the results by channel, geography, and audience segment to see which ones drove the lift. This will help you understand what worked, for whom, and why.

Adopt your findings from successful tests to refine future cross-channel marketing campaigns and continuously monitor them.

Specialized tools can help you ensure there’s no mess or gaps in your data. For example, RedTrack’s cookieless and privacy-first tracking technology ensures accurate GDPR, CCPA, and iOS-compliant data collection.

You can also enjoy server-side data tracking, event deduplication across channels, and postback URL support for affiliate and media buying campaigns. Plus, all your performance data is stored and visualized on one dashboard, making it easy to compare control and test outcomes.

Improve Your Results With Accurate Data

Every dollar you put into your marketing campaign should drive growth. It’s not enough to know what happened. You need to see why it happened and have data to back it up.

Marketing incrementality shifts the focus from attribution to causation. It helps you measure the true impact of your marketing efforts and evaluate whether your customers would have converted anyway.

Building an incrementality framework helps you cut through the vanity metrics, optimize your budget allocation, and make smart, data-backed decisions across your marketing channels.

And you don’t have to do it alone. RedTrack simplifies the entire process for you, from unified campaign tracking and advanced segmentation to real-time performance insights and budget optimization. With cookieless, cross-channel tracking, privacy compliance, and customizable attribution models, it gives you the necessary tools to measure true impact.

If you feel that it’s time to stop the guesswork and start proving what works, we welcome you to sign up for a free trial and see how RedTrack can power your incrementality testing and marketing efforts.