Client Success Stories – Marketing Mix Modeling

Marketing Mix & Pricing Analysis for Major Laundry-Care Company

laundry 150Client Issue/Needs

  • Client wanted to identify and understand the following:
    • Volume contribution and ROI of Media and Trade investments:
      • Performance of specific media campaigns
      • Own and Halo impact of media campaigns
    • Impact of brand advertisements on the category
    • Impact of price changes:
      • Extent of cannibalization from own products
      • Extent of stealing from competitors
    • Critical price thresholds

Our Solution: Marketing Mix Model with Competitive Effects

  • An integrated model encompassing competitive forces and possibility of category expansion/contraction.
  • Identified key competing products for each of client's products and quantified the extent of competition
  • Identified price points at which brand volumes show sharp increase/decrease

Activation

  • The media mix results helped the client in the following ways while planning for next year's media plan:
    • Minimize instances of media saturation.
    • Reshuffle media budget across brands based on effectiveness and ROI.
    • Identification of price thresholds and cross-effects vis-à-vis competitors helped the client make decisions about optimal price gap with respect to key competitors.
  • True impact of price promotions, taking cannibalization into account, was communicated to the sales team so that overall impact on the firm could be considered while making promotional decisions in the future.

Solutions

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