Transcript Mixing Your Marketing in Real Time

Mixing Your Marketing in Real Time
Ross Link, President, Nielsen Marketing
Analytics
Josh Kowal, Senior Vice President, Nielsen
Marketing Analytics
MARKETING MIX CHALLENGE:
DECLINING DOLLARS / GROWING PLATFORMS
MEDIA CHANNELS
100%
BUDGET
80%
60%
40%
20%
0%
2002
2006
2012
MEASURING SUCCESS REQUIRES
FACT-BASED LEARNING
QUANTIFYING MARKETING RETURNS IS NOT SIMPLE
SOCIAL MEDIA
TRADITIONAL
DIGITAL
MASS • REACH
GRANULAR • TACTICAL
THE SOLUTION
• MARKETING MIX IS STEP 1
• GRANULAR DATA + COSTS + CLIENT DETAILS
= FORWARD-LOOKING, PRESCRIPTIVE
OPTIMIZATION
• MAGNITUDE OF RESULTS ARE SURPRISING
REI – A UNIQUE CORPORATE CULTURE
BIKING
KAYAKING
SKIING
ECOFRIENDLY
CUSTOMER
SATISFACTION
FACT-BASED INSIGHTS = OPTIMAL RESULTS
ROI
59%
1
2
3
MEASURE EVERY TACTIC IN A MEANINGFUL WAY
NON-BRANDED
BRANDED
DIGITAL
PAID
TV
RADIO
PRINT
PAID SEARCH
COMPARATIVE
SHOPPING ENGINE
UNPAID
MEASURE ALL SALES CHANNELS
BOTH TRADITIONAL AND ONLINE
TRADITIONAL
RETAIL STORE SALES
DIGITAL
REI.COM SALES
BY DMA
COMPLETE
TACTIC
PERFORMANCE
FIND THE TRUE SOURCE OF
AN INCREMENTAL PURCHASE
AND OVERCOME THE “FALLACY OF LAST TOUCH”
EXAMPLE #1
Marketing mix models
would correctly give credit
to TV
EXAMPLE #2
Assigning credit by tracking click thru
patterns would incorrectly give credit
to Search
Marketing mix models
would correctly give
credit to Display
KEY
PROPERLY CREDITED
IMPROPERLY CREDITED
Because there is no way to directly
track clicks from display to retail,
credit would be “lost”
3-STEP PROCESS TO ANALYZE CURRENT
BUSINESS PERFORMANCE
MARKETING MIX MODEL- METHODOLOGY
STEP 1
SALES
DIRECT MAIL
TV
TIME
3-STEP PROCESS TO ANALYZE CURRENT
BUSINESS PERFORMANCE
MARKETING MIX MODEL- METHODOLOGY
STEP 2
SALES
DIRECT MAIL
TV
ATTRIBUTE SALES TO ACTIVITIES OCCURRING WHEN SALES INCREASED
Print
TV
DIRECT MAIL
Online
Core
3-STEP PROCESS TO ANALYZE CURRENT
BUSINESS PERFORMANCE
MARKETING MIX MODEL- METHODOLOGY
STEP 3
ANALYZE
RESULTS
EXPLAIN CHANGE
VS. YEAR-AGO
CALCULATE
ROI
CUSTOM OPTIMIZATIONS IDENTIFY
BEST POSSIBLE INVESTMENT
MARKETING
MIX MODELS
MARKETING
COSTS AND
PRODUCT
MARGINS
OPTIMIZED
PLAN
TV
PRINT
ONLINE
BY ACTIVITY
BUSINESS
RULES
BY WEEK
BY BRAND
BY CHANNEL
OPTIMIZATION: SAME BUDGET, BETTER RESULTS
Current Spend
Optimal Spend
40,000
40,000
35,000
35,000
30,000
TV
Online
25,000
20,000
15,000
INCREMENTAL IMPACT
INCREMENTAL IMPACT
Cut $500k
Lose 2,500 units
30,000
25,000
20,000
15,000
10,000
10,000
5,000
5,000
0
Add $500k
Gain 12,000 units
250
500
750
1000
1250
SPEND IN CHANNEL
ROI = $1.25
1500
TV
Online
0
250
500
750
1000
1250
1500
SPEND IN CHANNEL
ROI = $1.42
#C360
CONTINUOUS IMPROVEMENT =
IMPROVED PERFORMANCE
REFINE
MODELS
MORE
GRANULARITY
NEW
TACTICS
MAKE STRATEGIC SHIFTS IN YOUR TIMING
MAKE STRATEGIC SHIFTS IN YOUR MARKET
RADIO
MARKETS
DIGITAL
MARKETS
TV
MARKETS
ALL TACTICS
MARKETS
CHICAGO
MADISON
MILWAUKEE
SAN FRANCISCO
BOISE
AUSTIN
BOSTON
SEATTLE
SALT LAKE CITY
MINNEAPOLIS
ATLANTA
SAN DIEGO
ACCOUNT FOR DIFFERENCES
ACROSS SALES CHANNELS
RETAIL
SALES
BUDGET
2.9%
REVENUE
(8.7%)
(2.5%)
14.7%
ONLINE
SALES
HOW TO IMPLEMENT
• KNOW NOT ONLY WHERE MARKETING DOLLARS
WENT, BUT WHERE THEY SHOULD GO
• INCREASE PRECISION WITH MORE GRANULAR DATA
AND MAKE MORE SUCCESSFUL STRATEGIC DECISIONS
• CONTINUOUSLY REFINE/IMPROVE BASED ON THE
CHANGING ENVIRONMENT