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Mix Modeling
Marketing Mix Modeling
In recent times, we have seen the proliferation of new media (Internet, viral
marketing, event marketing, sports marketing, product placement, cell phones,
etc.), decreased television viewership, the advent of TiVo and similar technology
where viewers can skip through commercials, and increased cost-cutting pressures.
All of this has combined to increase demands for marketing departments to maximize
the return on their marketing investment: that is, to optimize the combination
of marketing and advertising investments in order to generate the greatest sales
growth and/or maximize profits. Marketing mix modeling measures the potential
value of all marketing inputs and identifies marketing investments that are
most likely to produce long-term revenue growth.
Typically, marketing mix modeling involves the use of multiple regression techniques
to help predict the optimal mix of marketing variables. Regression is based
on a number of inputs (or independent variables) and how these relate to an
outcome (or dependent variable) such as sales or profits. Once the model is
built and validated, the input variables (advertising, promotion, etc.) can
be manipulated to determine the net effect on a company’s sales or profits.
The data that go into creating a marketing mix model include:
- Economic data
- Industry data
- Category data
- Advertising data (including copy testing)
- Promotional data
- Competitive data
- Service data
- Product data
- Pricing data
- Features & performance
- Market outcome data
Analytical Consulting Services
Decision Analyst is a leading international marketing research and analytical
consulting firm with over 32 years of experience in state-of-the-art modeling,
simulation, and optimization. A team of Ph.D.s heads up Decision Analyst’s
choice modeling work. They publish many white papers on advanced analytical
methods and speak frequently at marketing research industry conferences.
Decision Analyst’s strengths in statistics and mathematics, simulation,
modeling, and optimization provide the analytical foundation to address complex
business and strategy issues. If you would like more information or would like
to discuss a possible project, please contact by emailing Jerry W. Thomas,
President/CEO (jthomas@decisionanalyst.com),
or John Colias, Ph.D. (jcolias@decisionanalyst.com)
or by calling 1-800-ANALYSIS (262-5974) or 1-817-640-6166.
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