Case study showing how Universal Music has automated its weekly media analysis using Artificial Intelligence and is getting better results and lowering costs
2. About Universal Music
♫ Global music market leader:
♯ 6 of the global 10 best selling tracks in 2009
♯ market share 27% in 2008
♫ Market leader in four of the five largest music markets
♫ UK market leader in 2009:
♯ 2 of the 5 best selling albums in the UK in 2009
♯ 33% market share for all albums
♫ Labels Polydor, Mercury, Island, Motown, Decca etc.
♫ Artists include U2, Lady GaGa, Elton John, Metallica
and Amy Winehouse
2
3. About Media Buying at Universal Music
♫ TV advertising is a key sales driver:
♯ over 1/3 total marketing budget on TV
♫ Marketing mix differs widely from album to album
♫ Each label responsible for managing its own budgets
♫ TV advertising budget is set on a project by project basis
♫ Budgets and spot allocation modified on a weekly basis
♫ Weekly Albums Chart gives immediate gauge of response
♫ How to separate TV response from other drivers?
3
4. Media Buying is a Source of Worry for Clients
Of the 50 largest advertisers in the world:
91 percent consider the media buying process
insufficiently transparent
85 percent are convinced their media agency
has deals outside the client agreement
74 percent said these deals cause bias in the
choice of media and recommendations
Source: CMO Council 2009
5. Ad Nav our Robotic Media Advisor
Agency / Client
Brief Plan/Cost Buy Execute Billing
What-If Learnings Results Reconciliation
AdNav
Our “Robotic” Media Advisor uses Artificial Intelligence
to produce over 1000 models annually
6. Comparison of Approaches
Media Agency + Audit/Model + AdNav
Timing 9-6 x 5 x 52 1x1x1 24 x 7 x 52
Media effectiveness Gut feel High level patterns Detail of every spot
Media invoice
Trust As and when audited 24 x 7 x 52
reconciliation
Media plan As and when audited
Trust 24 x 7 x 52
assessment & contract
Learning and As and when audited
Limited 24 x 7 x 52
improvement & delayed
Costs (function of £100k build
As per contract £50k - £100k p/a
“spec”) £50k p/a
Benefits Function of deal book [say] 2-10% 10-30%
7. Illustrative Results
Day Time Station Programme Adspend IncSales Cost of Sale
SUN 21:00 C4TV BIG BROTHER 10 HOUSE ACTION 5,000 500 10.00
MON 21:00 E4 DESPERATE HOUSEWIVES YR 2 500 100 5.00
MON 21:00 E4 DESPERATE HOUSEWIVES YR 3 600 120 5.00
TUE 21:00 LIVING GHOST WHISPERER S04 80 40 2.00
TUE 21:00 MORE4 WEST WING YR 7 US O5/06 700 350 2.00
WED 21:00 E4 YOUNG SEXY AND...RICH 100 40 2.50
WED 21:00 E4 DESPERATE HOUSEWIVES 400 160 2.50
WED 21:00 E4 ONE TREE HILL YR 6 1,000 400 2.50
THU 21:00 C4TV BIG BROTHER'S LITTLE BROTHER 4,000 500 8.00
FRI 21:00 C4TV UGLY BETTY YR 3 - CRIMES OF FASHION 2,500 250 10.00
FRI 21:00 LIVING FOUR WEDDINGS 200 20 10.00
SAT 21:00 C4TV BIG BROTHER 10 HOUSE ACTION 10,000 500 20.00
9,000 35,000 10 35,000
8,000 9
30,000 30,000
8
7,000
Sales by contribution (units)
25,000 25,000
Advertising spend (£/day)
7
6,000
Advertising spend (£)
Cost Per Unit (£)
Ads 6
20,000 20,000 CPU
5,000 Launch
CPU
Base 5
CPU
4,000 15,000 Sales 15,000 Spend
Spend 4
3,000
3 10,000
10,000
2,000 2
5,000 5,000
1,000 1
0 0 0 0
25 Nov
26 Nov
27 Nov
28 Nov
29 Nov
30 Nov
1 Dec
2 Dec
3 Dec
4 Dec
5 Dec
6 Dec
7 Dec
8 Dec
9 Dec
10 Dec
11 Dec
12 Dec
13 Dec
14 Dec
15 Dec
16 Dec
17 Dec
18 Dec
19 Dec
20 Dec
21 Dec
22 Dec
23 Dec
24 Dec
25 Dec
26 Dec
27 Dec
28 Dec
29 Dec
30 Dec
31 Dec
1 Jan
2 Jan
3 Jan
4 Jan
5 Jan
6 Jan
7 Jan
8 Jan
9 Jan
10 Jan
11 Jan
12 Jan
13 Jan
14 Jan
15 Jan
16 Jan
17 Jan
25 Nov
26 Nov
27 Nov
28 Nov
29 Nov
30 Nov
1 Dec
2 Dec
3 Dec
4 Dec
5 Dec
6 Dec
7 Dec
8 Dec
9 Dec
10 Dec
11 Dec
12 Dec
13 Dec
14 Dec
15 Dec
16 Dec
17 Dec
18 Dec
19 Dec
20 Dec
21 Dec
22 Dec
23 Dec
24 Dec
25 Dec
26 Dec
27 Dec
28 Dec
29 Dec
30 Dec
31 Dec
1 Jan
2 Jan
3 Jan
4 Jan
5 Jan
6 Jan
7 Jan
8 Jan
9 Jan
10 Jan
11 Jan
12 Jan
13 Jan
14 Jan
15 Jan
16 Jan
17 Jan
Date
Date
8. Spend
Sales
Advertising spend (£/day)
S 18-Apr
F 17-Apr
T 16-Apr
W 15-Apr
T 14-Apr
M 13-Apr
S 12-Apr
S 11-Apr
F 10-Apr
What explains this
T 9-Apr
W 8-Apr
T 7-Apr
M 6-Apr
S 5-Apr
S 4-Apr
peak?
F 3-Apr
Date
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
Campaign A
W 18-Mar
T 17-Mar
Sales by contribution (units)
9. Launch
Spend
Sales
Base
Ads
Advertising spend (£/day)
S 18-Apr
F 17-Apr
T 16-Apr
W 15-Apr
T 14-Apr
M 13-Apr
S 12-Apr
S 11-Apr
F 10-Apr
T 9-Apr
W 8-Apr
T 7-Apr
M 6-Apr
S 5-Apr
Carryover
S 4-Apr
F 3-Apr
Date
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
Campaign A
W 18-Mar
T 17-Mar
Sales by contribution (units)
10. Spend
Sales
Advertising spend (£/day)
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
Date
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
M 23-Feb
S 22-Feb
S 21-Feb
F 20-Feb
T 19-Feb
W 18-Feb
T 17-Feb
M 16-Feb
S 15-Feb
Campaign B
S 14-Feb
F 13-Feb
T 12-Feb
W 11-Feb
T 10-Feb
Sales by contribution (units)
11. Launch
Spend
Sales
Base
Ads
Advertising spend (£/day)
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
Date
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
M 23-Feb
S 22-Feb
S 21-Feb
F 20-Feb
T 19-Feb
W 18-Feb
T 17-Feb
M 16-Feb
S 15-Feb
Campaign B
S 14-Feb
F 13-Feb
T 12-Feb
W 11-Feb
T 10-Feb
Sales by contribution (units)
12. Spend
Sales
Advertising spend (£/day)
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
Date
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
M 23-Feb
S 22-Feb
S 21-Feb
F 20-Feb
T 19-Feb
W 18-Feb
T 17-Feb
M 16-Feb
S 15-Feb
Campaign C
S 14-Feb
F 13-Feb
T 12-Feb
W 11-Feb
T 10-Feb
Sales by contribution (units)
13. Launch
Spend
Sales
Base
Ads
Advertising spend (£/day)
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
Date
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
M 23-Feb
S 22-Feb
S 21-Feb
F 20-Feb
T 19-Feb
W 18-Feb
T 17-Feb
M 16-Feb
S 15-Feb
Campaign C
S 14-Feb
F 13-Feb
T 12-Feb
W 11-Feb
T 10-Feb
Sales by contribution (units)
14. Spend
Sales
Advertising spend (£/day)
S 18-Apr
F 17-Apr
T 16-Apr
W 15-Apr
T 14-Apr
M 13-Apr
S 12-Apr
S 11-Apr
F 10-Apr
T 9-Apr
W 8-Apr
T 7-Apr
M 6-Apr
S 5-Apr
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
Date
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
Campaign D
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
Sales by contribution (units)
15. Launch
Spend
Sales
Base
Ads
Advertising spend (£/day)
S 18-Apr
F 17-Apr
T 16-Apr
W 15-Apr
T 14-Apr
M 13-Apr
S 12-Apr
S 11-Apr
F 10-Apr
T 9-Apr
W 8-Apr
T 7-Apr
M 6-Apr
S 5-Apr
S 4-Apr
F 3-Apr
T 2-Apr
W 1-Apr
T 31-Mar
M 30-Mar
S 29-Mar
S 28-Mar
F 27-Mar
T 26-Mar
W 25-Mar
T 24-Mar
Date
M 23-Mar
S 22-Mar
S 21-Mar
F 20-Mar
T 19-Mar
W 18-Mar
T 17-Mar
M 16-Mar
S 15-Mar
S 14-Mar
F 13-Mar
T 12-Mar
W 11-Mar
T 10-Mar
M 9-Mar
S 8-Mar
S 7-Mar
F 6-Mar
T 5-Mar
W 4-Mar
T 3-Mar
M 2-Mar
S 1-Mar
Campaign D
S 28-Feb
F 27-Feb
T 26-Feb
W 25-Feb
T 24-Feb
Sales by contribution (units)
16. Before
Contribution Contribution Net
Business Unit gained lost contribution
A 200,000 (150,000) 50,000
B 400,000 (200,000) 200,000
C 500,000 (250,000) 250,000
D 300,000 (500,000) (200,000)
E 200,000 (100,000) 100,000
Total 1,600,000 (1,200,000) 400,000
Eight week period
17. After
Contribution Contribution Net
Business Unit gained lost contribution
A 150,000 (50,000) 100,000
B 350,000 (50,000) 300,000
C 450,000 (100,000) 350,000
D 250,000 (150,000) 100,000
E 150,000 (50,000) 100,000
Total 1,350,000 (400,000) 950,000
A reduction of An improvement of An improvement of
Eight week period £250k £800k £550k
19. AdNav – Good client “fit”
Heavy media user
Sales responses are at least as important
as brand building
Sales data is available daily and by region
Media plans are reviewed and adjusted to
fit changing market conditions
21. Feasibility Study
Find Correlations
Check Inter-Correlations
Build One-Day Model
22. Feasibility Score Card
Issue Score
Data Availability
Data Accuracy
Data Variability
Correlations and Inter-correlations
One Day Model
Total marks out of 100
23. About VBMF
VBMF
£ Consultancy established in 1989
£ Combining analytical and systems expertise
£ Academic input maintains us at leading edge
Cass Business School
The business school for the City of London
High in the research league tables globally
International mix of students from 60 countries
23