With the advent of big data and advanced technology, organizations are realizing the benefits that various analytical tools and approaches provide them. It is a known fact that marketing analytics drives growth opportunities, increases the marketing return on investment (MROI), and enables the organizations to make better decisions. In spite of being aware of its benefits, organizations are still stuck on a single performance measurement strategy and seldom take the risk of expanding their horizons and exploring advanced analytical tools. Today, there is a wide range of marketing analytics approaches available that can provide granular customer insights enabling organizations to save approximately one-fifth of their marketing spend which can positively impact the bottom line. These marketing analytics tools can assist organizations to understand the changing consumer habits and buying behavior which can in turn help them to strategically devise strategies. For Instance, a leading food manufacturer was able to boost customer loyalty, drive sales, and improve its profitability by leveraging marketing analytics. The client was able to determine the return on investment, increase in sales, while determining the factors that influenced customer behavior, buying patterns, and preferences.
Marketing analytics enables the management to make better based on a data-driven approach. Traditionally, marketers were acclimatized to making decisions based on gut feeling and intuition and often gave preference to marketing activities that performed well while neglecting the others. However, with the dawn of a new era of advanced and sophisticated marketing analytics tools that allows the marketers to measure proposals based on MROI, marketing effectiveness, and payback period. These marketing analytics tools provide a base to measure performance keeping in mind spend management, various media channels, and past decisions. One of the leading banks in the US wanted to expand its market share while optimizing their marketing spend. By using various components of marketing analytics such as marketing mix modeling and campaign analytics, was able to compare the ROI on various media channels for individual retail banking products based on advanced statistic models such as regression analysis.
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Marketing Analytics and its Advanced Approaches
An organization cannot devise an analytics strategy without weighing the pros and cons of each tool and determining which marketing analytics approach is the best fit for their business strategy. Marketing analytics includes three approaches that have gained momentum over recent years, which are as follows.
- Marketing Mix Modeling (MMM) is a statistical model that leverages past marketing data and present trends to predict the impact of future marketing activities. It helps organizations in identifying the marketing variables, both internal as well as external, that drive sales. It provides deep insights based on historical data that helps in forecasting long term effects, enables scenario planning, assists in budget planning, and allocation of funds.
- Another component of marketing analytics is campaign analytics, which helps measure each marketing campaign and touchpoint through various metrics such as customers reached, customer engagements, and the return on investment. It is different from MMM as campaign analytics provides insights on individual campaign touchpoints and the traffic generated through it.
- Attribution modeling is a method to determine and identify the media that drives sales and conversions. It is the process of attributing credit to marketing touchpoints that are responsible for the conversions. It could be any marketing activity such as email marketing, online ad, social feed, or the company’s website. This marketing analytics approach enables credit allocation to various mediums allows marketers to analyze which online investments are successful.
Organizations usually follow a siloed approach when it comes to selecting a performance measurement strategy. Instead of choosing only one of the above-mentioned marketing analytics approach, the business could benefit by combining two or more techniques to achieve high marketing return on investment. This integrated approach helps marketers to gain flexibility in budget planning and fund allocation and get more worth out of their marketing spend.
At Quantzig, we offer a wide range of marketing analytics solutions that provide granular insights to the organizations that will assist them to optimize their marketing mix, resulting in effective spend management, measure the marketing ROI, and marketing effectiveness of various promotional activities. Request a free proposal to learn more.