Upload
davidweinberger
View
220
Download
0
Embed Size (px)
Citation preview
8/8/2019 Marketing Analytics Presentation 11_16
1/36
Translating and Interpreting MarketingAnalytics
Identifying And Utilizing High Quality Data To DriveBusiness Decisions
David Weinberger
Mather Strategy and Marketing
Marketing Planning & Analysis 2010 SummitNovember 16th, 2010
mather:
43 Woodstock Street
Historic Roswell District
Roswell, GA 30075
www.matherstrategyandmarketing.com
http://www.matherstrategyandmarketing.com/http://www.matherstrategyandmarketing.com/8/8/2019 Marketing Analytics Presentation 11_16
2/36
Analytics
How Are You Translating and Interpreting
Marketing Analytics?
Page 2
8/8/2019 Marketing Analytics Presentation 11_16
3/36
Agenda
Translating and Interpreting Marketing Analytics
High Value/High ImpactV
Focus on Reoccurring Marketing Processes
Ensure Marketing Analytics Drive Business
Performance, Metrics and Scorecards
Continuously Test to Optimize Marketing Execution
Page 3
8/8/2019 Marketing Analytics Presentation 11_16
4/36
The Role Of Marketing
Customer, Consumer,
Shopper, Market Insights
Application Of Insights
Marketing Investment ROI
Acquisition, Retention, Up-Sell, Cross Sell
Consumer/Market Trends
Role ofMarketing
Brand Planning
StrategicPlanning
CustomerRelationshipManagement
Revenue
Management
Marketing Return
on investment
Channel
Development
New Product
Development
Analytics &Insights
Page 4
8/8/2019 Marketing Analytics Presentation 11_16
5/36
Identify RecurringMarketingProcesses
Ensure Marketing
Analytics Drive
Business Metricsand Scorecards
Continuously Test toOptimize Marketing
Execution
Translating and Interpreting Marketing Analytics
- Brand Planning
- Channel Selection
- Marketing Investment
Decisions (ROMI)
- Revenue Management
- Customer RelationshipManagement
- Strategic Planning
- New ProductDevelopment Repeatable Processes:
Increase Productivity Ensure Consistent
Decision Making Increase
Entrepreneurship Focus On Value-Added
Initiatives
21 3
Page 5
8/8/2019 Marketing Analytics Presentation 11_16
6/36
Identify Reoccurring Marketing Processes
- Increase Consideration, Purchase, and Equity- Brand Planning
- Increase Conversion- Channel Selection
- Identify Organic/InorganicGrowth Opportunities
- Strategic Planning
- New ProductDevelopment
- Optimize Sales and Profits- Marketing InvestmentDecisions (ROMI)
High Value/High ValueV
Marketing Processes
- Increase Customer Lifetime Value(Acquisition and Retention)
- Customer RelationshipManagement
- Increase Profitability- Revenue Management
1
Selection Criteria
Page 6
8/8/2019 Marketing Analytics Presentation 11_16
7/36
Marketing Investment Decisions
What Is Your ROI?
How does marketing drive revenues and profit? What is the ROI for marketing overall and by tactic? Where are the opportunities to improve Marketing spend?
How Can You ImproveMarketing Spending?
How can the marketing budget be optimized ? What is the optimal allocation of the marketing budget by
brand, channel and market? What is the impact of TV versus non-traditional marketing
tactics, such as internet and social media?
Key Questions to Ask About Your Marketing Investments
1
How Much Are YouSpending ?
How are you allocating Marketing spending? Which customers are you targeting? Which Channels generate the highest ROI?
Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 7
8/8/2019 Marketing Analytics Presentation 11_16
8/36
8
Marketing Investment Decisions
1 Identify Reoccurring Marketing Processes
High Value/High ValueV
NationalTV
Radio
Spot TV
Media Response Curve - Example
Media Spend
Revenue
8/8/2019 Marketing Analytics Presentation 11_16
9/36
Marketing Activity Lift Example
Marketing Investment Decisions
1 Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 9
-3
-2
-1
0
1
2
3
4
5
National
TV
Radio Direct
Coupons Spot TV Hispanic Price
Reduction
Sports
8/8/2019 Marketing Analytics Presentation 11_16
10/36
RevenueIncrease
Direct Mail
National TV
Radio
Coupons
PriceReduction
Spot TV
CostReturn on
Investment
Hispanic
Sports
Marketing Investment Decisions
1 Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 10
3.4 25 13.6
4.2 23 18.3
2.3 24 9.6
2.3 23 10.0
1.7 22 7.7
3.2 12 26.7
-2.4 10 -24.0
-1.9 10 -19.0
Return on Investment - Example
8/8/2019 Marketing Analytics Presentation 11_16
11/36
Use Scenario Modeling to Improve Marketing Spend Effectiveness - Example
Marketing Investment Decisions
1Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 11
BudgetAllocation
Return onInvestment
10% 25 13.6
5% 23 18.3
15% 24 9.6
10% 23 10.0
20% 22 7.7
5% 12 26.7
25% 10 -24.0
10% 10 -19.0
BudgetAllocation
$ CostReturn on
Investment
XX XX XX
XX XX XX
XX XX XX
XX XX XX
XX XX XX
XX XX XX
XX XX XX
XX XX XX
Current Proposed
Direct Mail
National TV
Radio
Coupons
PriceReduction
Spot TV
Hispanic
Sports
$ Cost
8/8/2019 Marketing Analytics Presentation 11_16
12/36
12
Marketing Investment Decisions
1 Identify Reoccurring Marketing Processes
High Value/High ValueV
Marketing Investment Vs ROI - Example
Increase Spending.
Test different Medium,Targets, and MessagingOptions
Ensure you arespending optimally onthe decay curve.
Modify spending levelsto maximize ROI
Reduce Spending.Assess Target, Medium,and Message
Reduce spending.Revaluate target,medium and message
$0.00Low High$0.00
High
Marketing $ Investment
ROI
Low
8/8/2019 Marketing Analytics Presentation 11_16
13/36
Key Metrics
- Marketing Tactic ROI
- Volume Trends Versus Objectives
- % Customers Acquired
- % Increase In Revenue
Marketing Spend Effectiveness Scorecard
1
Marketing Investment Decisions
1Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 13
8/8/2019 Marketing Analytics Presentation 11_16
14/36
Marketing Mix Simulation
Media Planning Optimization
Advertising Decay Curves
Impact of Marketing Tactics
Impact of Marketing Tactics by Segment, Geography
Marketing Tactic ROI
Volume Trends Versus Objectives
% Customers Acquired
% Increase In Revenue
Monthly
Bi-Annual
Annual
Marketing Investment Decisions
11Identify Reoccurring Marketing Processes
High Value/High ValueV
Page 14
8/8/2019 Marketing Analytics Presentation 11_16
15/36
Identify RecurringMarketingProcesses
Ensure MarketingAnalytics Drive Business
Performance, Metrics andScorecards
Continuously Test toOptimize Marketing
Execution
Translating and Interpreting Marketing Analytics
- Marketing activities arequantified based onBusiness metrics
- All functional groups are
measured on the sameCustomer and
Business metrics
- Marketing focused oncreating profitablegrowth:
- Customer acquisition- Customer retention- New usage occasions- New segments
21 3
- Brand Planning
- Channel Selection
- Marketing InvestmentDecisions (ROMI)
- Revenue Management
- Customer RelationshipManagement
- Strategic Planning
- New ProductDevelopment
Page 15
8/8/2019 Marketing Analytics Presentation 11_16
16/36
Page 16
Key Questions
What type of customers should we acquire? What incentives should we use?
What Marketing activities to increase profitability?
What is the likelihood a specific customer will churn?
How is a customers value affected by various Marketing activities or targetedincentives? What will happen to my bottom line if those attributes change by
10%?
How do we operationalize CLV to impact retention and drive increased customer
satisfaction through targeted customer experiences?
CLV analysis (Present value of a customers total contribution to your cash flow) identifieskey strategic opportunities to grow revenues and profits
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
Customer Relationship Management CLV Analysis
8/8/2019 Marketing Analytics Presentation 11_16
17/36
Page 17
Allocate acquisition and retention resources to optimize Marketing dollars
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0 60 120
180
240
300
360
420
480
540
600
660
720
Expected Lifetime
(Area Under Curve)
Likelihood of Survival:New Customer
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
Customer Relationship Management CLV Analysis
ARPU Average revenue per user
CCU = cash cost per user
CLV = [(ARPU CCU)*(Expected Lifetime)] PV - CPGA
8/8/2019 Marketing Analytics Presentation 11_16
18/36
Page 18
Database
Monthly Increments
Customer/Subscriber Handset Market Demographics Credits/Fees
Historical Data
DatabaseCall / IVR Reporting
Operations Reporting
Marketing Reports
CLV Reports
Customer, Purchase, Market, Demographic and other Qualitative metrics are used toconstruct the CLV model
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
Customer Relationship Management CLV Analysis
8/8/2019 Marketing Analytics Presentation 11_16
19/36
Page 19
LTV Model Development Process
Construct a customer service history Start date
Usage statistics (e.g., MOU, service plan, IVR minutes)
Service changes
End date
Attach indicators to the service history Demographics (e.g., income, age, gender, market, language)
Industry-specific metrics (e.g., handset data, technology features)
Organization-specific metrics (e.g., payment methods, fees, credits)
Develop a survival (retention) model
Calculate a best fit (regression) model correlating the customer variables
to survival rates.
Calculate the CLV using the survival rates
How the model is built and implemented is crucial to making CLV
scores actionable
Customer Relationship Management CLV Analysis
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
k l
8/8/2019 Marketing Analytics Presentation 11_16
20/36Page 20
Key Drivers of Customer Lifetime Value
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
Attribute Baseline ChangeEffect
CLV CPGA ARPU CCU
Customer Type New Existing
Acquisition Month April
May
February
Handset Age 12 mths Increase
Income Tier 4 Increase
Age 43 Increase/Decrease
Average MOU 1,486 Increase
Average IVR 12 Increase
Gender F M
ODP (Handset Revenue) $100 Increase
Monthly Contract Price $45 Increase
Monthly Fee Revenue $10 Increase
Customer Relationship Management CLV Analysis
k i l i i i
8/8/2019 Marketing Analytics Presentation 11_16
21/36
Develop strategies for Customer selection, Customer segmentation, Resource allocation,Customer Acquisition Priorities, and Cross Selling Priorities
1) Up Sell and
Cross Sell
1) Assess
customer
value, ensure
good
collection
1) High end
services
1) Retention
campaigns
2) Customized
offers
Low High
Low
High
CLV
Probability
Of Staying
Retain
MaintainNurture
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
Customer Relationship Management CLV Analysis
Page 21
E M k i A l i D i B i
8/8/2019 Marketing Analytics Presentation 11_16
22/36
Ensure Marketing Analytics Drive BusinessPerformance, Metrics and Scorecards
2
2 5 m n C m n , I nc . ll ri h t r rv
Scenario 1
Example: Investment Simulation
-30%+30%+30%Radio
-30%No change+30%Television
Scenario 3Scenario 3Scenario 2Scenario 2Scenario 1Scenario 1
Spending ChangeSpending Change
N/AN/A+30%Direct Mail
N/AN/A+30%Out of Home
N/AN/ANAMagazine
N/A+30%+30%Newspaper
-30%-30%+30%Special Promotions
N/A-30%-30%Events
-30%-30%-30%Trade
N/A+30%+30%Logos
XXXXXXResults
N/A-30%+30%Sponsorships (Sports)
-30%+30%+30%Public Relations
2 5 m n C m n , I nc . ll ri h t r rv
Scenario 2
Example: Investment Simulation
-30%+30%+30%Radio
-30%No change+30%Television
Scenario 3Scenario 3Scenario 2Scenario 2Scenario 1Scenario 1
Spending ChangeSpending Change
N/AN/A+30%Direct Mail
N/AN/A+30%Out of Home
N/AN/ANAMagazine
N/A+30%+30%Newspaper
-30%-30%+30%Special Promotions
N/A-30%-30%Events
-30%-30%-30%Trade
N/A+30%+30%Logos
XXXXXXResults
N/A-30%+30%Sponsorships (Sports)
-30%+30%+30%Public Relations
2 5 m n C m n , I nc. l lri h t r rv
Scenario 3
Example: Investment Simulation
-30%+30%+30%Radio
-30%No change+30%Television
Scenario 3Scenario 3Scenario 2Scenario 2Scenario 1Scenario 1
Spending ChangeSpending Change
N/AN/A+30%Direct Mail
N/AN/A+30%Out of Home
N/AN/ANAMagazine
N/A+30%+30%Newspaper
-30%-30%+30%Special Promotions
N/A-30%-30%Events
-30%-30%-30%Trade
N/A+30%+30%Logos
XXXXXXResults
N/A-30%+30%Sponsorships (Sports)
-30%+30%+30%Public Relations
Determine Leverage Points Level of investment?
Product Focus
Type of message (brand vs. product
message)
Marketing Mix (TV, Outdoor, Events)
Segment Mix (Targets, Geographies)
Generate Strategic Alternatives
Model and compare alternatives High
Medium
Low
Include CLV metrics in cross functional scorecards
Customer Relationship Management CLV Analysis
Page 22
8/8/2019 Marketing Analytics Presentation 11_16
23/36
Identify RecurringMarketingProcesses
Ensure MarketingAnalytics Drive Business
Performance, Metrics andScorecards
Continuously Test toOptimize Marketing
Execution
21 3
- Facilitates BestOrganizationalThinking
- Optimizes Marketingexecution
- Enables Marketingto quickly react tonew Trends,Customers, and
Segments
- Increases MarketingROI
Translating and Interpreting Marketing Analytics
- Marketing activities arequantified based onBusiness metrics
- All functional groups are
measured on the sameCustomer andBusiness metrics
- Marketing focused oncreating profitablegrowth:
- Customer acquisition- Customer retention- New usage occasions- New segments
- Brand Planning
- Channel Selection
- Marketing InvestmentDecisions (ROMI)
- Revenue Management
- Customer RelationshipManagement
- Strategic Planning
- New ProductDevelopment
Page 23
8/8/2019 Marketing Analytics Presentation 11_16
24/36
Continuously Test to Optimize Marketing Execution3
Revenue Management Value Based Pricing
Strategic Pricing Four Elements of Marketing
Product Print content, Web site content, Design
Promotion Advertising, Brand development, Sales
Distribution Delivery, Customer service
Pricing Acquisition offers & renewal prices
Sources: The Strategy and Tactics of Pricing by Tom Nagle and Reed Holden; Mather Economics LLC analysis
Use Pricing to capture value created by your brand/company. Failing tointegrate pricing with your overall strategy and other value-creatingactivities leads to lost revenue
Page 24
8/8/2019 Marketing Analytics Presentation 11_16
25/36
Cost-plus pricing
Historically, the most common method used by companies
Price is determined as a set mark-up over a cost basis that often includes
allocated overhead and direct operating costs
A biased cost basis can lead to unprofitable pricing decisions!
Customer-driven pricing
Focused on what customers indicate they are willing to pay
Prices adjusted to meet sales objectives
Often leads to less profitable pricing
Competition-driven pricing
Matching competitions prices
Not as common in Newspaper industry
Value-based pricing is focused on the value customers place on the product.
Different customers value your products and services differently.
Sources: The Strategy and Tactics of Pricing by Tom Nagle and Reed Holden; Mather Economics LLC analysis
Continuously Test to Optimize Marketing Execution3
Revenue Management Value Based Pricing
Page 25
8/8/2019 Marketing Analytics Presentation 11_16
26/36
Strategic Pricing Framework: Focus On Charging for the Value of the Product/ Service
Costs Customers Competitors
StrategicObjectives
Goals
Tactics
High quality localTV coverage;
online audiencegrowth; total market
coverage25% customer
churn; 65% market
penetration; 10%revenue growth Targeted acquisition
offers; Start sourceallocation; renewalprice optimization
(Market BasedPricing)
Continuously Test to Optimize Marketing Execution3
Revenue Management Value Based Pricing
Sources: The Strategy and Tactics of Pricing by Tom Nagle and Reed Holden; Mather Economics LLC analysisPage 26
8/8/2019 Marketing Analytics Presentation 11_16
27/36
Use Test and Control groups to identify the impact of different Marketing Tactics to
retain customers.
Indicators of Elasticity
Elasticity varies by customer
Tenure
Service frequency
Pricing history
Payment method
Income
Age
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
1.8%
2.0%
0% 2% 4% 6% 8% 10% 12% 14%
StopR
ate
% Price Increase
Price Increases vs Stop Rate
Large Price
Increase, Low Stop
Rate
(Highly Inealstic)
Small PriceIncrease, High
Stop Rate (Highly
Elastic)
Higher Income
Higher Income
Lower Income
Medium Income
Medium Income
Continuously Test to Optimize Marketing Execution3
Revenue Management Value Based Pricing
Page 27
8/8/2019 Marketing Analytics Presentation 11_16
28/36
The Role Of Marketing
Customer, Consumer,Shopper, Market Insights
Application Of Insights
Marketing Investment ROI
Acquisition, Retention, Up-Sell, Cross Sell
Consumer/Market Trends
Role ofMarketing
Brand Planning
Strategic
Planning
CustomerRelationshipManagement
Revenue
Management
Marketing Returnon investment
Channel
Development
New Product
Development
Analytics &Insights
Page 28
8/8/2019 Marketing Analytics Presentation 11_16
29/36
Identify RecurringMarketingProcesses
Ensure Marketing
Analytics Drive Business
Performance, Metrics andScorecards
Continuously Test toOptimize Marketing
Execution
21 3
- Facilitates BestOrganizationalThinking
- Optimizes Marketing
execution
- Enables Marketingto quickly react tonew Trends,Customers, and
Segments
- Increases MarketingROI
Translating and Interpreting Marketing Analytics
- Marketing activities arequantified based onBusiness metrics
- All functional groups are
measured on the sameCustomer andBusiness metrics
- Marketing focused oncreating profitablegrowth:
- Customer acquisition- Customer retention- New usage occasions- New segments
- Brand Planning
- Channel Selection
- Marketing Investment
Decisions (ROMI)
- Revenue Management
- Customer RelationshipManagement
- Strategic Planning
- New ProductDevelopment
Page 29
O tli f F ilit t d P T D l M k ti
8/8/2019 Marketing Analytics Presentation 11_16
30/36
Outline of Facilitated Process To Develop MarketingAnalytics Road Map
Day One Morning
Identify Core Marketing Metrics - 1 hour session Aligned with Corporate objectives
Identify available data
Determine interdependencies
Prioritize metrics to be used
Determine Key Marketing Processes - 2 hour session Develop fish and bone diagrams
Identify data and process interdependencies
Identify data and process voids
Prioritize based on Revenue and ROI opportunities
Day One Afternoon
Identify Analytics Based on - 4 hour session
Prioritized Marketing Processes (Top 3 -5) Identify Exception Reports and Scorecards
Identify top five reoccurring analyses across functional groups
Identify advanced analytical needs
Page 30
Outline of Facilitated Process To Develop Marketing
8/8/2019 Marketing Analytics Presentation 11_16
31/36
Outline of Facilitated Process To Develop MarketingAnalytics Road Map
Day Two Morning
Team Breakout Sessions For Top 3 -5
Marketing Processes - 4 Hour Session
Identify Exception Reports and Scorecards
Identify top five reoccurring analyses used across functional group Create specifications for advanced analytics
Develop fish and bone diagrams
Identify data and process dependencies
Identify data and process voids
Prioritize based on Revenue Opportunity and ROI
Day Two Afternoon - 4 Hour SessionTeam Report Outs
Review fish and bone process
Agree on metrics and data needs
Prioritize Analytics development
Page 31
Outline of Facilitated Process To Develop Marketing
8/8/2019 Marketing Analytics Presentation 11_16
32/36
Output From Facilitated Process
1. Road Map With Key Marketing Processes Identified2. Prioritized Marketing Processes And Analytics Identified
3. Alignment On Metrics For Key Scorecards, Exception Reports,
Reoccurring Analyses, And Advanced Analytics
4. Data Dependencies, Voids And Interrelationships Identified
Outline of Facilitated Process To Develop MarketingAnalytics Road Map
Page 32
8/8/2019 Marketing Analytics Presentation 11_16
33/36
Who Are We?
Strategic Marketing And Applied Analytics Consulting Group
33
Our Approach: Customer-focused, data and insights-driven
with a bias towards adding value to the business
Our Focus: Developing business and marketing strategies andtactics to maximize customer acquisition and Customer
Lifetime Value
Our Consultants: A mix of PhDs, marketers and strategic
consultants from world-class companies
Our Essence: Making sense of complex data through
advanced analytics and technology to support key business
decisions
8/8/2019 Marketing Analytics Presentation 11_16
34/36
What Makes Us Different?
Proven and established advanced analytics capabilities to
draw insights from large quantities of data
Experts at data capture, integration and visualization
Experts at solution delivery in the enterprise space and
cutting edge technologies
Deep understanding of how customer insights drive business
decisions
Mix of marketers, consultants and PhDs
34
We excel at uncovering growth opportunities from large andcomplex data sets -- We are problem solvers!
8/8/2019 Marketing Analytics Presentation 11_16
35/36
Our Core Capabilities
35
TechnologyCustomer DrivenGrowth Strategy
Marketing Strategy &Capabilities
Data Analytics
Portfolio strategy
Value propositionand brandarchitecturedevelopment
Marketingcapabilitiesdevelopment
Customer drivenstrategic planning
Customer centricorganizationalalignment
Customer path-to-
purchase strategyand touch pointoptimization
Customer and channelsegmentation
Marketing spendeffectiveness
Customer LifetimeValue
Promotion analytics
Customer Acquisition
and Retention
E-mail/On-line/ Search
optimization
Pricing analytics
Cross-sell/up-sellopportunities
Customer Path-to-purchase analysis
Test & learn protocol
Social mediatracking &engagementmethods &technologies
Technologyrequirements &
planning
Data capture,storing, analytics &visualizationtechnologies
Marketing analyticsroad map andexecution
Copyright 2009 Mather LLC. All ri ghts reserved.
8/8/2019 Marketing Analytics Presentation 11_16
36/36
mather:
43 Woodstock Street
Historic Roswell District
Roswell, GA 30075
770-993-4111 main
www.mathereconomics.com
David Weinberger
770-649-0472
Contact Information
http://www.mathereconomics.com/mailto:[email protected]:[email protected]://www.mathereconomics.com/