measuring marketing spend - insight...

© 2018 FORRESTER. REPRODUCTION PROHIBITED.

Measuring Marketing Spend:Multi-Stage Marketing Mix ModelingDoug JensenVP, CRM & Corporate Marketing AnalyticsEstée Lauder Companies

October 2018

2© 2018 FORRESTER. REPRODUCTION PROHIBITED.

Marketing Objective: Accurately Measure Marketing Across the Consumer Decision Journey› Challenge / Opportunity:

• Measure marketing objectives when sales isn’t the only outcome• Measure the tactics’ contribution on each stage of the journey:

awareness, consideration / engagement, conversion• Understand how upper funnel tactics contribute to each stage of the

journey• Determine how digital & e-commerce marketing efforts drive upper

funnel activity• Measure e-commerce marketing halo onto brick & mortar


Consumer Decision Journey› We conduct consumer research to determine the important touch points on the consumer’s

journey with our brand in a key category

In-store Displays and assortments

AdvertisingIn-store Experts

Word of Mouth

Social Media (“Owned” and “Earned”)

Online reviews Promotions

The counter experience

› Answers questions such as:

• What are the purchase journeys for a brand in a given category?

• What tactics or touch points are important for awareness, consideration, conversion?

• What does this mean for our brands?


Consumer Decision Journey / Funnel = Many Tactics

ENGAGE

CONVERT

Traditional TacticsOnline

Brand-Owned Retailer Influencer

• Traditional Paid Media

• Editorials, PR mentions

• Sampling• Events• Word of Mouth

• Non-Branded Search• Paid / Non-Paid Social• Awareness Display• Prospecting (Look-a-like

Targeting)• Native Content• Tutorials/How-to Videos

• Tutorials/How- to Videos

• Co-op Awareness Display

• Repurpose influencer UGC and cultivate influencer relationships

• Retail Events• Retail Windows• In-store

Navigation

• Paid Social / Paid Video• Brand Social Posts• Live Chat

• Content / Visibility on Retailer sites

• Influencer-led retail “meet-up” events

• Product demostration

• In-store Samples• Direct Mail

• Branded Search• Performance Display• Retargeting Display• Live Chat• Email• Online Sampling

• Co-op Performance Display

• Sampling• GWP

• Partnerships with influencers for promotions or discount codes (if appropriate)

• Demo• Loyalty Programs

(Brand and Retail)• Direct Mail

• Online Exclusives• Loyalty Programs• Email• Live Chat• Ratings & Reviews

• Retailer Loyalty Programs

• Product collaborations with Influencers

AwarenessCreate Demand &

Drive Traffic

Consideration & Engagement

Conversion & Loyalty

› There are many choices!


Marketing Mix Modeling – Multi-Stage Approach› Multi-stage approach is a cascade model that measures the direct and indirect effects of marketing

performance at each stage of the consumer journey / purchase funnel

› Multi-stage approach allows to measure impact of both offline and online media investments on awareness, consideration, and conversion to sales

1. AWARENESS 2. CONSIDERATION 3. CONVERSION

QUERIES

(GOOGLE)

WEBSITE TRAFFIC

IN-STORE-SALES

Offline Media

Online Media

Display

Social

TV

Print

Radio

OOH

Search Indirect impact

Direct impact Direct impact

Direct impact

STEP 1: IMPACT OF BOTH

ONLINE & OFFLINE MEDIAON SEARCH QUERIES

Indirect impact

In-Store

Promotions

Worker Hours

Other actions, etc.

ECOMM-SALES


ONLINE & OFFLINE MEDIAON WEBSITE TRAFFIC


ONLINE & OFFLINE MEDIAON B&M

AND ECOM SALES


Marketing Mix Modeling – Multi-Stage Approach› Estimate a total ROI per marketing lever by funnel area by integrating online to store effect

› Identify differences of efficiency between lever at each step of customer purchase

1. AWARENESSQueries

2. CONSIDERATIONWebsite Traffic

3. CONVERSIONSales

Contribution

ROI

Illustrative


Google & Facebook Actively Partner on Measurement


Marketing Mix Vendors

Source: Forrester Research, “Marketing Mix Modeling Landscape Overview” by Luca Paderni, 2011 (classifications), updated with additional vendors listed in Forrester Wave, Q4 2016


My Perspective on Marketing Mix Modeling vs Multi-Touch Attribution

Multi-Stage Marketing Mix Multi-Touch AttributionStrategic vs. Tactical Strategic Tactical

Areas of Spend Evaluated

Traditional, Digital & Social Media; In-store;

E-commerceE-Commerce

Areas of ConsumerJourney Evaluated

Awareness, Consideration/ Engagement, Conversion Conversion

Halo to Total Business Yes No

Endorsed by Google & Facebook Yes No


Conclusion on Marketing Mix› Marketing Mix Modeling is a standard method for measuring overall marketing

effectiveness and endorsed by Google and Facebook

› Multi-stage modeling allows us to measure all parts of the consumer decision

journey and have a good integration of ecommerce investments:

• Having an un-siloed measure: same ROI scale for online & offline tactics

• Understanding impact of digital & social media levers at each step of the

consumer decision journey

• Measuring the Online to store effect: how e-commerce investments are

impacting B&M directly and indirectly through halo and cross channel effects

measuring marketing spend - insight...

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