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Market Research Council

Welcome!. Market Research Council. Measuring Marketing Spend: Multi-Stage Marketing Mix Modeling. Doug Jensen VP, CRM & Corporate Marketing Analytics Estée Lauder Companies. October 2018. Marketing Objective : Accurately Measure Marketing Across the Consumer Decision Journey.

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Market Research Council

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  1. Welcome! Market Research Council

  2. Measuring Marketing Spend:Multi-Stage Marketing Mix Modeling Doug Jensen VP, CRM & Corporate Marketing Analytics Estée Lauder Companies October 2018

  3. Marketing Objective: Accurately Measure Marketing Across the Consumer Decision Journey • Challenge / Opportunity: • Measure marketing objectives when sales isn’t the only outcome • Measure the tactics’ contribution on each stage of the journey: awareness, consideration / engagement, conversion • Understand how upper funnel tactics contribute to each stage of the journey • Determine how digital & e-commerce marketing efforts drive upper funnel activity • Measure e-commerce marketing halo onto brick & mortar

  4. Consumer Decision Journey • We conduct consumer research to determine the important touch points on the consumer’s journey with our brand in a key category • Answers questions such as: • What are the purchase journeys for a brand in a given category? • What tactics or touch points are important for awareness, consideration, conversion? • What does this mean for our brands? The counter experience In-store Experts Advertising In-store Displays and assortments Word of Mouth Online reviews Promotions Social Media (“Owned” and “Earned”)

  5. Consumer Decision Journey / Funnel = Many Tactics • There are many choices! Awareness Create Demand & Drive Traffic Consideration & Engagement ENGAGE Conversion & Loyalty CONVERT

  6. Marketing Mix Modeling – Multi-Stage Approach • Multi-stage approach is a cascade model that measures the direct and indirect effects of marketing performance at each stage of the consumer journey / purchase funnel • Multi-stage approach allows to measure impact of both offline and online media investments on awareness, consideration, and conversion to sales 2. CONSIDERATION 1. AWARENESS 3. CONVERSION Offline Media TV Print Radio IN-STORE-SALES Direct impact Direct impact Direct impact QUERIES (GOOGLE) OOH WEBSITE TRAFFIC ECOMM-SALES Online Media Display Search Indirect impact Indirect impact Social In-Store STEP 1: IMPACT OF BOTH ONLINE & OFFLINEMEDIA ON SEARCH QUERIES STEP 2: IMPACT OF BOTH ONLINE & OFFLINEMEDIA ON WEBSITE TRAFFIC STEP 3: IMPACT OF BOTH ONLINE & OFFLINEMEDIA ON B&M AND ECOM SALES Promotions Worker Hours Other actions, etc.

  7. Marketing Mix Modeling – Multi-Stage Approach • Estimate a total ROI per marketing lever by funnel area by integrating online to store effect • Identify differences of efficiency between lever at each step of customer purchase Contribution Illustrative ROI

  8. Google & Facebook Actively Partner on Measurement

  9. Marketing Mix Vendors Source: Forrester Research, “Marketing Mix Modeling Landscape Overview” by Luca Paderni, 2011 (classifications), updated with additional vendors listed in Forrester Wave, Q4 2016

  10. My Perspective on Marketing Mix Modeling vs Multi-Touch Attribution

  11. Conclusion on Marketing Mix • Marketing Mix Modeling is a standard method for measuring overall marketing effectiveness and endorsed by Google and Facebook • Multi-stage modeling allows us to measure all parts of the consumer decision journey and have a good integration of ecommerce investments: • Having an un-siloed measure: same ROI scale for online & offline tactics • Understanding impact of digital & social media levers at each step of the consumer decision journey • Measuring the Online to store effect: how e-commerce investments are impacting B&M directly and indirectly through halo and cross channel effects

  12. Market Research Council

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