Marketing Mix Modeling & Optimization
Key Elements:
Measures effectiveness of all types of marketing – branding as well as promotional, including competition and external factors like weather
Provides ROI for each advertising and promotional campaign, including halo effects on related brands
Shows how to maximize sales and/or profit by finding optimal marketing spend
Allows for diminishing returns, cannibalization, and media lag effects

Marketing Mix Models quantify the sales impact of various marketing activities and determine effectiveness and ROI for each marketing activity. Our optimization techniques can provide a roadmap for the future by showing how to adjust marketing strategies, plan budgets, manage channels, create pricing strategies, and produce the highest return for your marketing investments.

Marketing Mix Modeling helps brand managers identify the right mix of advertising media and make better business decisions in terms of allocating marketing spend and media planning.

Analyze Current Business Performance
How We Do It Key Model Insights

Why are sales up or down vs. a year ago?

What is incremental sales lift from promotion vs. media advertising?

Does any vehicle look to be near diminishing returns in terms of spending?

Which ad campaigns run recently have been most effective? Which least?

Which markets exhibit the greatest response to promotions?
 Align sales with marketing.
Sales
Promos
TV
Attribute sales to activities occuring when sales increased.
Time

Decompose SalesExplain Change vs. Year-AgoCalculate ROI
Maximize ROI by Allocating Marketing Spend to More Productive Investments
How We Do It Key Model Insights
Models Financial Input Business Rules

What is the highest revenue/profit that can be achieved with the current marketing budget by shifting spend to more productive investments?

What is the minimum marketing budget and allocation strategy to meet a sales target?

What is the right balance of broad scale and direct marketing for revenue/profit maximization?
Optimization Algorithms
Optimal Spend
by Vehicle by Item by Weeks
Conduct Deep Dives on Advertising Effectiveness
Key Model Insights

We typically include all relevant advertising vehicles in our standard marketing mix models, and deep dives are an extension of those models encompassing a broader range of marketing tactics as well as other environmental factors. This approach enables us to provide accurate sales response measures by vehicle that let you build more effective media plans. We track advertising effectiveness on all types of vehicles: TV, Magazine Print & ROP, Radio, Online, Outdoor/Out of Home, In-Store Radio/TV, PR/Word of Mouth, etc.

Advertising Effectiveness analytics involve examining a wide range of factors, including audience selectivity, reach potential, speed of audience accumulation, geographic flexibility, creative executions, and media weights. We measure ad response by campaign so effectiveness can be compared through key advertising metrics, including carryover after air date (adstock), saturation, and diminishing returns levels. Direct and halo effects can also be measured to determine portfolio level effectiveness.

Which media vehicle drives the most incremental sales? TV? Radio? Online?

Does any media vehicle look to be near diminishing returns?

Which advertising daypart is most efficient (incremental sales $ per $ spending)?

Which recent TV campaigns have been most effective? Which media vehicle works longest after airing?

Which type of advertising drives more incremental sales? Brand? Product? Promotional?
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