Marketing Mix Modelling (econometrics) consultancy
What is Marketing Mix Modelling (MMM)?
Marketing mix modelling (also known as MMM or econometrics) is a set of statistical analysis techniques applied to marketing or sales data to estimate the impact of various marketing activities. It will often be used to optimise the advertising mix and promotional tactics to increase ROI or incremental revenue.
The benefits for your organisation should be weighed against the costs but the fact of the matter is that in our experience many brands are missing out on a significant opportunity to maximise their ROI and incremental turnover by not conducting MMM.
We will work with you directly or alongside your MMM supplier to ensure that you measure all media correctly to give you as clear a picture as possible of how to optimise your spend.
“But you can’t measure the ROI of digital via marketing mix modelling (econometrics)”
A common misconception we come across is that you can’t measure the ROI of various digital channels via MMM. We’ve come across many big brands in various sectors that have believed this.
It is true you need a certain dataset size to have a high level of statistical significance. However, often in this case either data is not being collected in line with best practice, or MMM is not being conducted effectively.
To attribute digital marketing sales optimally you should consider digital attribution modelling. Learn how we can develop the model right for your organisation here:
Marketing mix modelling services
We can work work with you to ensure that you have advanced econometric models that can disaggregate and quantify all key drivers of historic sales including:
- ATL Advertising – TV, VOD, OOH, Press, Radio, Cinema, Digital (Online Video, Display, Programmatic, Mobile, Search SEM / SEO, Social, Influencers) and PR.
- BTL Advertising – Coupons, Sampling, Door Drops, In-Store Media, Direct Marketing (Mails/Emails), Affiliates and On / In Pack Promotions.
- In-Store Promotions – Promotional Mechanics/Offers, Special Packs and On / Off Shelf Display Support.
- Pricing– own price, competitor price, price relative to competitors and crossing of price thresholds.
- Distribution– changes in breadth and depth of distribution, facings, shelf position, new product launches and de-listings.
- Other non-controllable factors– competition, category trends, seasonality, holidays, weather, economy, national events and out of stocks.
Econometric model outputs provide clients with huge benefits including:
- A detailed understanding of the key drivers of business performance to date and the relative contribution of each one.
- Sales uplifts and return on investment metrics for each individual marketing and sales investment lever.
- Price and promotional elasticities.
Quantification of the inter-dependencies between investment levers. For example, does TV advertising drive online search?
- What is the optimal mix of media channels?
- Is there a synergistic effect when synchronising TV with in-store promotions?
Contact us to find out more. However, before you do, hear from some of our clients who have worked with our MMM lead Dan Rimmer. We can provide more references on request.