Marketing Mix Model: 6 things you should know
Marketing Mix Model refers to the usage of both analytical and statistical tools for identifying and measuring the impact of past marketing decision in order to predict the future impact of different marketing tactics on sales. This has been a great tool for preparing effective marketing plans. Marketing mix model predicts the assured path of getting profitable returns on various marketing investment. Let’s take a look at some other aspects of marketing mix model:
- The success of effective marketing mix model depends on the availability of right and sufficient data. Moreover, the integrity of that data is also essential for an accurate marketing mix model. However, unlike the common perception, data is quite available at an enterprise than you can think of. You just have identify the right sources inside.
We can help you identify your data resources and can conduct an audi on your readiness. http://www.sibiaanalytics.com/contact
- The benefits of the marketing mix model are tremendous in the long term. It mainly focuses of evaluating marketing success in terms of Return on Investment (ROI) – which is a metric the top management are increasingly looking at. It also helps an organisation to optimise their marketing mix and plans by predicting the impact of the changes to the different variables of the marketing mix.
By analyzing the marketing in a holistic framework with external factors too, it also helps in determining the causes behind the changes in business outcome, by differentiating between the effects of both internal as well as external factors.
You can learn more from the pioneers here: http://www.nielsen.com/us/en/insights/reports/2014/marketing-mix-modeling-what-marketers-need-to-know.html
- Marketing Mix Model helps in identifying performance drivers. It distinguishes between each performance driver by segregating them into external factors such as economic trends, pricing etc. and internal factors such as media selection, advertising quantum, promotions at trade or consumer level, etc.
- A proper Marketing Mix Model helps the brand managers understand the trade-offs that they have to face by locating various marketing activities that are impacting the organisation in a different way. This is more particular in regards to the generation of revenues and the ones that impact the price perception of the consumers.
- This model can also be used to develop simulation in order to facilitate the planning of alternative marketing programmes. SIBIA’s RoMiI60 (www.romi360.com) provides you with an online marketing planner that simulates your plan and predict the outcome instantly! You can compare multiple plans at one go!
- Marketing Mix models in principle, establish a correlation between the different marketing initiatives and the results. And these models estimates the net impact of each marketing driver, even when multiple activities are in play. That is the beauty of statistics and econometrics; with the right tool and data, you can estblist the relation which are otherwise elusive.
To learn more about marketing mix modeling and how it can help you, please reach out to us!
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