“Hands-on” Marketing Mix Optimization Reallocates Ad Spend and Unifies Marketing & Sales Teams
Challenge
- To maximize profitability, a leading global alcoholic beverages company set out to optimize media budget allocation across their key global markets.
- Given the complexities of alcoholic beverage production and distribution and given the diverse portfolio of brands each at different life-stages with asymmetric appeal globally, it was necessary to have a measurement approach that could include both short- and long-term analysis of the impact of both marketing and trade promotions.
- Furthermore, any optimization would need to be in the context of broader strategic plans and based on the longer-term trajectories of the brand portfolio development.
- They chose Marketscience specifically for the company’s heritage in portfolio budget allocation, advanced modeling and ability to support clients with more sophisticated needs.
Solution
- To ensure adoption of budget recommendations from the Marketscience SimOpt tool, it was important to foster a close collaboration between the client’s advertising, trade marketing and finance teams.
- In addition to the MMM estimated short and long-term response curves, it was also necessary to effectively score the strategic importance of the brands and country combinations and integrate more forward-looking drivers of marketing effectiveness.
- Marketscience provided “hands-on” workshops that challenged the marketing and merchandising management teams to develop strategic scores for the brands based on “marketplace attractiveness” and the brands “right to win.” This unique consulting approach was effective at building marketing and sales team consensus around the task, unveiling highly valuable considerations and challenges that factored into the final plan.
Results
- The first round of optimizations revealed a 14% increase in marketing ROI and the marketing optimization approach now forms the cornerstone of the client’s 5-year investment plan across key global markets.
- Today, Marketscience continues to use econometric modeling to track the results of the major brands across markets in order to continually refine the client’s marketing budget allocation and support detailed planning by brand.
What We Did
- Marketing Mix Optimization
- Adoption and Use of Analytic Outputs
- On-site Training
Client Quote
“Marketscience’s unique approach to data analysis provides the insight we need to make strategic decisions, while at the same time approaching it in a way that builds consensus internally. We’ve relied on Marketscience’s expertise for years and they continue to deliver meaningful insights and guidance that informs the growth of our business.”