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Paul Laughlin, Managing Director, Laughlin Consultancy
Marketing Effectiveness
Measurement replaces
Budget Envy
#CAI2015
©...
Klondike Goldrush
© Laughlin Consultancy Ltd, not to be used without permission.
Klondike Goldrush
© Laughlin Consultancy Ltd, not to be used without permission.
Two types of marketers
© Laughlin Consultancy Ltd, not to be used without permission.
One type of size comparison
© Laughlin Consultancy Ltd, not to be used without permission.
Our digital goldrush
❖ How many Twitter Followers?
❖ How many Facebook Fans/Likes?
❖ Has your video ‘gone viral’ on YouTub...
What a business should measure
❖ Turnover is vanity…
❖ ROI before investments
❖ Return On Marketing Expenditure
© Laughlin...
Measuring profit
© Laughlin Consultancy Ltd, not to be used without permission.
• Fully costed marketing
• Sales caused by...
Two types of Marketing
© Laughlin Consultancy Ltd, not to be used without permission.
• Brand building
• Awareness & Consi...
Econometrics for ATL
© Laughlin Consultancy Ltd, not to be used without permission.
• Statistical technique(s) to help ass...
Experimental Method for BTL
© Laughlin Consultancy Ltd, not to be used without permission.
Response
Data
(all channels)
Co...
You need insight
Customer
Data
Customer
Research
Customer
Analysis
Database
Marketing
Feel &
Measure
Target
Marketing
Conv...
Marketing Attribution
© Laughlin Consultancy Ltd, not to be used without permission.
Incremental
Modelled
Financial
Report...
Budget Allocation step 1
❖ Annual Marketing budget:
❖ functional unit allocation
❖ share of revenue allocation
❖ share of ...
Budget Allocation step 2
❖ Optimal allocation across:
❖ Products/Markets
❖ Brands
❖ Purchase Funnel
© Laughlin Consultancy...
Credibility requires Accountability
❖ Use the language of profit
❖ Use ROME with Finance
❖ Converge evidence
❖ Rigorous bu...
linkedin.com/in/paullaughlin
paul@laughlinconsultancy.com
+44 (0)7446 958061
Contacting me:
customerinsightleader.co
m
lau...
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Marketing Effectiveness Measurement replaces Budget Envy

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Presentation on Measuring Marketing Effectiveness which I presented at #CAI2015 in London on 25 Feb 2015. A review of that event can be found at: http://customerinsightleader.com/events/event-cai2015/

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Marketing Effectiveness Measurement replaces Budget Envy

  1. 1. Paul Laughlin, Managing Director, Laughlin Consultancy Marketing Effectiveness Measurement replaces Budget Envy #CAI2015 © Laughlin Consultancy Ltd, not to be used without permission.
  2. 2. Klondike Goldrush © Laughlin Consultancy Ltd, not to be used without permission.
  3. 3. Klondike Goldrush © Laughlin Consultancy Ltd, not to be used without permission.
  4. 4. Two types of marketers © Laughlin Consultancy Ltd, not to be used without permission.
  5. 5. One type of size comparison © Laughlin Consultancy Ltd, not to be used without permission.
  6. 6. Our digital goldrush ❖ How many Twitter Followers? ❖ How many Facebook Fans/Likes? ❖ Has your video ‘gone viral’ on YouTube? ❖ How many downloads of your latest app? ❖ How many site/blog visits? ❖ How many people saw your commercial? ❖ Are we being recommended? © Laughlin Consultancy Ltd, not to be used without permission.
  7. 7. What a business should measure ❖ Turnover is vanity… ❖ ROI before investments ❖ Return On Marketing Expenditure © Laughlin Consultancy Ltd, not to be used without permission. ❖ ROME = ( ΔRevenue – ΔCosts) / ΔMarketing Spend
  8. 8. Measuring profit © Laughlin Consultancy Ltd, not to be used without permission. • Fully costed marketing • Sales caused by marketing • Historical data on sales from different levels of marketing spend • Max increase in sales achievable by marketing • Marketing spend needed to achieve 50% of max • Gross margin on sales • % of costs that are fixed From “Marketing Payback” Robert Shaw & David Merrick:
  9. 9. Two types of Marketing © Laughlin Consultancy Ltd, not to be used without permission. • Brand building • Awareness & Consideration • Maintaining Share of Voice • Social normally TTL (from LinkedIn ads to broadcast YouTube) ATL BTL • Targeted communications • Personalised & timed • Driving action, often to buy
  10. 10. Econometrics for ATL © Laughlin Consultancy Ltd, not to be used without permission. • Statistical technique(s) to help assess which of many possible factors are key drivers of sales results, combine them in a quantitative model and then use to predict the future • Business input • Base • Ad-stock • ‘Halo effects’
  11. 11. Experimental Method for BTL © Laughlin Consultancy Ltd, not to be used without permission. Response Data (all channels) Contact History F2F/Service Call Centre Website Outbound eMail/DM Social STEP 1 Data Gathering STEP 2 Matching Back Response Contact History STEP 3 Considering rela onship and other drivers Brand Rela onship Learning from Econometrics Marketing attribution includes considering multi-media attribution & multi-channel view of value Targeted + Contacted Untargeted + Contacted Targeted + Not Contacted Untargeted + Not Contacted
  12. 12. You need insight Customer Data Customer Research Customer Analysis Database Marketing Feel & Measure Target Marketing Converge Evidence © Laughlin Consultancy Ltd, not to be used without permission.
  13. 13. Marketing Attribution © Laughlin Consultancy Ltd, not to be used without permission. Incremental Modelled Financial Reporting Market Position Media Tracking
  14. 14. Budget Allocation step 1 ❖ Annual Marketing budget: ❖ functional unit allocation ❖ share of revenue allocation ❖ share of voice allocation © Laughlin Consultancy Ltd, not to be used without permission. ❖ ‘Rightsize’ the budget ❖ Optimising ROME
  15. 15. Budget Allocation step 2 ❖ Optimal allocation across: ❖ Products/Markets ❖ Brands ❖ Purchase Funnel © Laughlin Consultancy Ltd, not to be used without permission. ❖ Comparing ROME contributions ❖ Consider evidence for media interdependencies
  16. 16. Credibility requires Accountability ❖ Use the language of profit ❖ Use ROME with Finance ❖ Converge evidence ❖ Rigorous budget allocation © Laughlin Consultancy Ltd, not to be used without permission.
  17. 17. linkedin.com/in/paullaughlin paul@laughlinconsultancy.com +44 (0)7446 958061 Contacting me: customerinsightleader.co m laughlinconsultancy.com @LaughlinPaul © Laughlin Consultancy Ltd, not to be used without permission.

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