As marketers embrace omnichannel advertising to deliver a connected brand experience, marketing executives are spending hundreds of thousands of dollars to understand the types of marketing investments that are most likely to produce - viable, long-term revenue growth and profitability. Broadly speaking, marketing mix models evaluate the key components of the marketing plan, such as promotions and advertising by combining data from online and offline sources to present a clear guidance for an improved return on marketing investment.
However, data forms a crucial element to Marketing Mix Modeling – and it’s not just clean data but data that is specific to a KPI being analyzed, such as pricing, promotions, events, campaigns, macro-economic indicators and other salesforce drivers that can help is robust model build. Now, MMM have become the workhorse for enterprises and even SMB’s but marketers need to understand one model will not fit the entire portfolio of offerings they have. Given how MMM is an ongoing process, the models need to be reweighted on a regular basis.
Is Your Marketing Mix Modeling Platform Delivering Measurable Value?
Is your team or vendor able to deliver a marketing mix model that can lead to sustained, long-term sales growth and improved profitability? Are the simulated marketing variables delivering the right results and is it viable for marketers to implement the recommendations as part of their strategic planning activities? Most MMM solutions available in the market today do not allow any clear visibility into the link between ad spends, promotions and the measured KPI, leading to a black-box experience for consumers of these solutions.
Rise Of Independent Vendors In Market Mix Model Landscape
There are several profiles of solution providers with offerings in this ever-growing landscape from large software-service providers, pure-play analytics services firms to traditional business consulting firms. Today, independent analytics vendors like Analytic Edge are at the vanguard of a new wave of companies that offer fully-featured domain-agnostic market mix modeling platforms and product suites. Analytic Edge has revolutionized the marketing mix analytics by enabling clients with features such as data onboarding, built-in marketing plan templates and “What If Scenario” simulation analyses that enable real-time dissemination of insights through an easy-to-use technology platform. Another key factor is the cost saving advantage offered by Analytic Edge’s Demand Drivers platform which combines data from disparate sources to develop an end-to-end analytical solution and helps organizations achieve their business goals.
While the primary objective of MMM is to quantify the link between ad spending, promotions and any KPI being measured, another objective is to maximize KPIs by forecasting the right media mix for promotions. But as marketers and CMOs, how does one actually trust the validity of MMM given the complexities involved in the underlying data science approach. This is where Analytic Edge’s Demand Drivers platform differs – instead of following the conventional black box approach, marketers get visibility into every step of MM model development.
Analytic Edge’s Demand Drivers Resolves Key Pain Points
- Time taken for data collection and preparation is reduced from 4-6 weeks to 1 week
- Time taken to secure a data review sign-off from multiple stakeholders before proceeding with the analysis is reduced from 2 weeks to two days
- Marketers with only a basic knowledge of data science can also build models, i.e., DIY
- Ability to continuously monitor effectiveness of marketing elements and take corrective action to achieve business targets
- Demand Drivers helps clients develop MMM for a larger portfolio of KPI’s at a fraction of current costs and with reduced reliance on vendors
Here’s How Analytic Edge’s Demand Drivers Platform Differs From The Standard Marketing Mix Modeling Platforms
1) DIY Platform: Demand Drivers is a cloud-based DIY platform compatible with multiple cloud-infrastructure service providers like Microsoft, AWS (Amazon Web Services) and Google. And the technology stack includes SQL server database, .NET MVC framework, Kendo UI and “R”. It includes 6 modules viz. Data Ingestion, Data Visualization, Predictive Modelling, Model Reporting, Marketing Simulation and Business Planning
2) No Black Box Approach: Clients at times do not trust the validity of MMM due to the complex underlying data science approach but Demand Drivers allows visibility into every step in the marketing mix model development. Clients can easily follow the logic due-to a user friendly and non-technical UI design.
3) Reduction In Cycle Time: With Demand Drivers, marketing mix modeling insights can be delivered in 4-6 weeks including data extraction and transformations unlike the traditional methods that range from 12-16 weeks
4) Expanded Coverage: Senior management spends millions of dollars on MMM and due to cost-pressure, the clients outsource MMM for only the high performing brands and geographies. Also, given the long turnaround times taken to deliver MMM it is often difficult to implement for multiple brands. This is where Demand Drivers scores over other vendors by accommodating a larger portfolio due to the seamless process for developing and deploying MMM at an affordable cost.
5) DIY Model: Clients who have the bandwidth to accept ad-hoc requests from management can use Demand Drivers to run MMM analysis quickly and effectively. Most of the traditional companies have MMM run by analysts proficient in “R” or “SAS” that makes it difficult for clients without a background in programming to run MMM iterations
6) Business Friendly Simulation: Marketers can choose to run an optimization that will use the sanctioned budget and allocate it across all marketing tactics. Traditionally, this is done outside the MMM platform, based on client request and incurs an additional cost. Also, one of the key differentiators of the Demand Drivers platform is that it offers a client-friendly dashboard and an easy-to-use interface to run simulation and optimization what-if scenarios.
7) Continuous Monitoring of Marketing Effectiveness: The true value of MMM is derived from leveraging it to drive decision-making to address critical business challenges. Demand Drivers’ Business Planning module has the following advantages:
- Automated data ingestion with in-built data Quality Control process
- Add incremental data periodically and refresh MMM models seamlessly, if MMM developed using Demand Drivers
- Ability to add third-party models. Often, clients develop their own MMM due to in-house constraints and don’t intend to deviate from the norms. Demand Drivers can use those models and configure the planning module
- Ability to forecast not just the response KPI using causal regression but use univariate forecasting techniques to forecast all drivers and use those values to forecast response KPI
8) Flexible Subscription Model: Demand Drivers is a good fit for both SMBs operating on small budgets as well as large organizations with big marketing budgets. The cost effectiveness of the platform makes it a viable option for licensing.
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Richa Bhatia is a seasoned journalist with six-years experience in reportage and news coverage and has had stints at Times of India and The Indian Express. She is an avid reader, mum to a feisty two-year-old and loves writing about the next-gen technology that is shaping our world.