Marketing Optimization

ModelingMaximising ROI with your current

marketing budget

About Us

Bottom-Line Analytics LLC is a consulting group focusing on marketing optimization modeling.

Our modeling experts have a total of over 50 years of direct experience with marketing optimization modeling.

We are dedicated to the principles of innovation, excellence and uncompromising customer service.

Most important, however, we are dedicated to getting tangible and positive business results for our clients.

What is Marketing Optimization Modeling? (MMO)Marketing Optimization Modelling is a statistical technique used to identify andquantify the relationships between your sales (or KPIs) and the factors that influencethem.

Sales

Macro-Economic

Factors

Distribution

Price

Mass Media: TV,

Radio, Print, OOH

SeasonalityPromotion

Paid Digital Media

Other Earned Digital Media

Social Media

MMO helps to answer basic questions

What are the most effective marketing channels – TV, Radio, Outdoor, Print orDigital?

What has been the ROI of paid search and banner ads?

How effective is social media?

Which marketing messages are most effective in driving sales?

How responsive are my customers to changes in price?

How important are holiday promotions?

What is the effect of seasonality on sales?

What is the best way to allocate my marketing budget?

Stages in Marketing Optimization Modeling

1. Using historic media, marketing plans and sales data, we assemble a predictive model which causally links each marketing activity to sales*.

2. Beyond this, we quantify the impact of media and marketing on your retail sales and provide you with direct guidance on what is working well and not-so-well in terms of ROI.

3. The greatest power and benefit from this exercise comes from our marketing spending optimization exercise: a simulation whereby we move current spending from less to more productive activities in order to maximize the growth and ROI of your current marketing budget.

Using linguistic theory we have devised a metric that captures the behavioral patterns of social networks. Our net positive social-media "engagement" (SEI) mirrors company seasonal patterns suggesting that the metric captures more than just social networks, with a correlation of 87%

The SEI is used as a reflection of total "word-of-mouth" and a proxy for consumer good will.

Pushing the boundaries with social media ROI

Key Deliverables from Marketing Optimisation

Modeling

A highly predictive sales model

Our modeling techniques prove to be highly predictive. We deliberately holdout approximately 10% of the dataset to test for accuracy.

Sales decomposition

Decomposition of sales provides a snap shot of the overall importance of media and marketing in driving total sales. In this case, 31% of total sales revenues are “due to” marketing expenditures.

Marketing return on investment

The first step in improving marketing productivity is to determine precise financial returns to marketing spending by campaign/acitivity.

Optimal spend solution across all channels

We conduct a mathematical optimization of your marketing spend and show you how to generate between 4-8% higher revenues without increasing total marketing investment.

£ £

Play out marketing scenarios and synergies

We provide an interactive dashboard that allows you to simulate different marketing mix scenarios and the resultant impact on sales.

Marketing synergies can be assessed through simultaneous activation of campaigns. The results of combined activation are always greater than the sum of the parts. This is a clear indication of synergies from running truly integrated campaigns.

What makes us different?

1. We can help to reduce wastage in your marketing spend by optimizing it across media channels with the highest ROI.

2. Our unique modeling approach allows us to quantify the synergistic effects of multi-channel integrated marketing. Traditional media mix methods do not allow for simultaneous and synergistic effects to be determined.

3. We have pushed the boundaries in modeling excellence and are able to measure the impact of social buzz by incorporating our proprietary SEI (Social Engagement Index)

4. We can guarantee to increase sales between 4 – 8% with your current marketing budget alone.

5. Our project turnaround time is only 6 weeks (subject to data availability)

Case Study: Retail bank

Business objective: Client has suffered 18 months of declining sales due to theglobal recession. They needed a new idea that would help re-charge sales across the differentlines of business (loans, deposits and home insurance). Our task was to measure theeffectiveness of multiple marketing, sponsorship and media campaigns by return oninvestment.

Solution: We undertook a broad ranging market mix modeling exercise to measure the incremental impact of media and marketing activity and provided steer on how to reallocate budget to stimulate loan applications, the deposit book and home contents and buildings insurance.

Result: Our models were highly accurate in their ability to predict future sales. Percentage year over year loan applications increased by 4 percent via a reallocation of spend towards branded online paid and display banners. Overall, all lines of business saw between a 2 and 7 percent uplift in sales in the following quarter.

Case Study: Major USA based beverage & food retailer

Business objective: Client has suffered 18 months of declining sales due to theglobal recession. They needed a new idea that would help re-charge sales andgrowth, across their network of 15,000 stand alone retail stores. Our task was to measure and compare returns from test markets for a new product. This product was a radical departure from their common product offerings and many in their marketing department were sceptical of its success. The test involved two markets. One market had minimal marketing and merchandising support, while the other had the national equivalent of $50 million in marketing and advertising.

Solution: The marketing mix models were developed and set up such that we could measure not only the impact of media and marketing on the new brand, but also the incremental impact or lift this product launch had on total outlet sales.

Result: Our models found a high return to the heavy spend marketing of $7.89 per dollar investment. We also found that this product launch actually stimulated a +3% increase in total store or system sales. One quarter after launching this product nationally, this client reported its first quarter of profit increase and growth in same-store sales in 18 months.

Case Study: Major hotel chain

Business objective: Client is a major hotel chain consisting of 350 properties ranging from extended-stay type of units to very high-end luxury hotels in resort areas. In 2009, this chain was just coming off of a major downturn due to a lapse in business travel and conventions from the Great Recession. They needed to follow the path outlined by Tom Davenport’s Competing with Analytics and leverage marketing-mix models in order to gain competitive advantage in their highly competitive industry.

Solution: We have conducted a series of three marketing-mix models by property and region for this client. Each engagement identified opportunities to optimize their marketing spend and generate growth from +8 to +12% by moving budge funds from less to more productive marketing activities.

Result: From the initial engagement, the clients annualized rate of growth has accelerated form -3 to +6 to +11 percent increase in revenue bookings year-over-year. The improved growth and profitability has further enabled the chain to free up capital in order to make a key acquisition that will expand their total footprint capacity by 20 percent.

The journey to increased ROI and sales

Step 1• Initial meeting. A critical meeting where we understand your current

business strategies and campaigns and jointly develop project objectives

Step 2• Data collection. We will work with local IT, Data warehouse experts and

media agency to collect all relevant data.

Step 3• Data assimilation and review with client. Review and approval of all data

inputs.

Step 4• Analytics & Modeling to provide key deliverables

Step 5• Face to face presentation

Step 6• Ongoing follow-ups and delivery of interactive simulator

Our experience

MJW@bottomlineanalytics.comMA@bottomlineanlaytics.com

404.841.1620

metricsman2010

Michael WolfePrincipalBottom-Line Analytics, LLC

Contact details

678.314.8446

www.bottomlineanalytics.com

Masood AkhtarEVPBottom-Line Analytics, LLC