This paper shows 12 key startegic lessons derived from analytics or marketing scence which under score the value that this discipline brings to higher levels of busness performance.

1. 12 Best Practice &
Real-World
Lessons From
Marketing Science

2. Destination
12 reasons why what John Wanamaker said over
100 years ago is still true today for many
companies.

3. Activity Gross Profit Cost Net Returns
Net
Returns
per
Dollar
Happy Meals Promotions & Media 3,160,598$ 2,968,021$ 192,577$ 0.06$
Dollar Value Menu Launch Promo & Media 23,555,630$ 1,310,043$ 22,245,587$ 16.98$
Othwe New-Product Launch Promo & Media 11,486,433$ 1,003,366$ 1,048,313$ 1.04$
Local TV 35,542,717$ 28,970,949$ 6,571,768$ 0.23$
Nationl TV 66,212,538$ 93,623,194$ (27,410,656)$ (0.29)$
Local Radio 44,161,985$ 27,987,848$ 9,174,137$ 0.33$
Local OOH 4,146,555$ 4,867,079$ (720,524)$ (0.15)$
Total 188,266,456$ 160,730,500$ 11,101,202$ 0.07$
1. Under-Investing in Blockbuster New Products
misses the opportunity for higher sales & growth
On some occasions, a blockbuster & “diamond-in-the-rough” product comes along. One example of this
was McDonald’s “Dollar Value Meals”, which was launched in 2004-5; and in which McDonald’s
significantly under invested during its first two years. By under-investing, McDonald’s lost a lot of sales &
profitability that they would never recover. Eventually, they right sized their marketing spend and Dollar
Value Meals became a significant driver of their total business growth.

4. 2. Failure to test & control for the ad messaging
leads to inefficient resource allocation
In 2006, Cingular Wireless (now AT&T) developed a blockbuster TV ad with the claim that they had the
“fewest dropped calls”. There is often over 100X difference in the ROI of the best ads versus the least
effective ads. Invariably, companies under invest in the former and over invest in the latter, leading to
lost sales.
$(5.00)
$-
$5.00
$10.00
$15.00
$20.00
$25.00
Net Returns per Dollar of "Fewest Dropped Calls"
Cingular Ad
Net Returns per Dollar of Lowest ROI Cingular Ad
$21.43
$(0.20)
ROI Per Dollar of Cingular Wireless Ads 2006

5. 3. Failure to test & measure marketing & media
impact will miss the mark on revenue & ROI.
A high percent of spend is going to ads which do not generate any incremental revenue. This is because
50% of firms do not do any marketing ROI measurement and 85% of advertising is not copy tested.1 This
unequal distribution shown below is the poster-child for below par sales performance.
87%
100%
32%
55%
0%
20%
40%
60%
80%
100%
120%
1
20
39
58
77
96
115
134
153
172
191
210
229
248
267
286
305
324
343
362
381
400
419
438
457
476
495
514
533
552
571
590
609
628
647
666
685
704
723
742
761
780
799
818
837
Number of ads placed ranked by contribution
Cumulative % Contribution and % of Spend by Ad
% of Contribution
% pf Spend
1 The CMO Survey, Duke University Fuqua School, Feb. 2018
45% of spend on
ads with zero
measured impact

6. 4. Inefficient spending comes from incorrect
attribution to media channels, due to unmeasured
indirect or synergistic media effects
Synergistic effects occur when multiple media, running together, drive more revenue than the sum of
each ad’s separate impact. For this retailer, this synergistic effect accounts for 56% of the totf al
advertising impact. Some “high-funnel” media like National TV actually boosts performance of other
media in a synergistic fashion. Not accounting for this is a misallocation resources.
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
Incremental$000's
Retailer: Annual Revenue Impact of Media, Direct & Indirect 2018
Direct Synergy (Indirect)

7. 5. Failing to measure & account for the long-term
effects of advertising leads to inefficient spending
In the case cited here, long-term advertising effects account for 77% of the net returns from all
advertising. 60% of marketing decision makers say they can not prove the long-term impact of their
marketing spend 1. Lack of knowledge here will result in lower sales & ROI.
1 The CMO Survey, Duke University Fuqua School, Feb. 2018
$-
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
Media ROI Media ROI
$1.48 $1.48
$3.49
Advertising Short & Long-Term ROI per Dollar Spend
Short-Term Media ROI Only Long-Term Media ROI

8. 6. Failing to accurately account for cross-channel
media synergies will likely distort how marketers
allocate dollars to the most effective channels
In the case below, we found a sizable synergistic effect coming from an upper-funnel TV media driving a
significant amount of revenue through digital search. Without this knowledge, this retailer would have
significantly under invested in TV
0
2
4
6
8
10
12
Separate Simultaneous Synergy from Television
Television Non-Branded Search Synergy from Television

9. 7. Media sales response is constrained by
minimum threshold and maximum saturation
rules. Non-compliance with these rules results in
wasted spending and lower sales.
In the case below, the brand’s weekly media TRPS were above saturation 29% of the weeks and below
the minimum threshold in 48% of the weeks. This is inefficient spending which cost this brand 4% in
total sales.
Saturation
Threshold
Optimal
0
0.2
0.4
0.6
0.8
1
1.2
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140
RESPONSE
TRPS
TV response vs TRPs
response
29% of weeks above
saturation levels38% of weeks
below minimum
threshold

10. 8. In marketing, success often depends on
location, location, location
In the case below, we found location a key predictor of effectiveness for outdoor ads. These were
proximity to Disney World & Universal theme parks, electronic billboards and high traffic roads.
Investing in analytics to discover which locations work best has a large payoff.
$-
$5.00
$10.00
$15.00
$20.00
$25.00
I-4 Digital OOH 408 Large
Bulletin OOH
429 Florida
Turnpk Digital
OOH
538 Digital
OOH
417 Large
Bulletin OOH
International
Drive Large
Bulletin OOH
$19.78
$2.89
$11.79
$23.33
$2.34
$1.65
Orlando Net Returns per Dollar Invested for Outdoor Advertising

11. 9. With other media, success also depends
on the time of day in which ads are aired
With this brand, there is a huge difference in the ROI from running TV ads on Prime time versus other
time slots. In this case, it does not make sense to run prime-time media ads. By reallocating all of its
prime media to non-prime, the brand could increase its ROI per dollar from $4.96 to $12.50.
$-
$200.00
$400.00
$600.00
$800.00
$1,000.00
$1,200.00
Early Fringe Erly Morning Early News Late Fringe Late News Prime Access Prime Sports Prme
$1,072.23
$9.25 $3.68
$662.07
$301.70
$0.59 $1.39 $0.74
TV: Returns per Dollar by Daypart

12. 10. Many companies fail to understand what their
customers value most about their brands & this leads to
a misallocation of marketing resources
Most Important Positive Drivers:
1. The Brand & Place
2. For Meeting People
3. The Beverages
4. The Store Atmosphere
Positive SEI
3.93 = 100
Place2HangOut
>5.46= 211
9.1%
Place2HangOut
<5.46 = 83
91.9%
ToMeetPeople>
9.43 = 325
2.6%
ToMeetPeople<
9.63 = 188
6.5%
Beverage>14.0
= 466
0.6%
Beverage<14.0
= 288
1.9%
To Meet People
>5.4 = 229
3.8%
To Meet People
<5.4 = 85
85.5%
Beverage
>6.4 = 271
7.7%
Beverage
<6.4 = 74
77.8%
Place2HangOut
>3.6 = 126
5.9%
Place2HangOut
<3.6 = 76
71.9%
Atmosphere
>5.2 = 211.1
1.6%
Atmosphere
<5.2 = 67
70.3% 12
In Starbucks, we determined via Social media, that the instore customer experience
was more important in defining the brand than their own products. This
led Starbucks to redesign their promotions and advertising. For exam-
ple, their relaunch of Frappuccino. Their promotion said that “if you
come to Starbucks with a friend and buy a Frappucciino, we will give one
to your friend for free“. In terms of added sales, this
was the strongest promotion at the company in 10
years. The success of this event was due to the
importance of the instore “ social experience“.

13. 11. In order to maximize sales and ROI, brands
must be positioned correctly; and their ad
messaging needs to reflect that positioning
Starbucks’ instant coffee, VIA, was launched in the Fall of 2009. Originally, its primary positioning benefit
was for its ”Convenience”. In the next year, a large survey was taken and Starbucks found that
consumers were more driven by “authenticity” . In other words, consumers were saying that, what they
liked most about VIA was that it tastes like the original brewed Starbucks coffee. Starbucks changed
their positioning on the brand & its sales continued to grow, reaching $100 million in 2011.
2.8% 3.5%
8.2% 8.5%
9.6%
13.5%
19.8%
33.9%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
Wonderful
Aroma
Delicious
Flavors
Great gift idea Convenient Tastes great
hot or cold
Tastes great For taking to
the office
Tastes like
brewed
Starbucks
ShareofCustomerPreference
Key positioning statements for Starbucks Via Coffee

14. 12. Few companies totally optimize their media
spend and therefore leave millions of dollars of
revenue growth on the table
Contribution Current Spend Optimal Spend
POS-Promotion 197,562,720 $10,287,740 $10,982,205
TV 164,816,244 $16,044,354 $14,051,092
Radio 54,197,934 $4,725,052 $5,522,938
OOH 89,886,131 $4,639,756 $5,253,853
Digital Media 99,568,039 $2,679,593 $2,566,406
Total Optimized Spending by Channel
+17%
+7%
-12%`
-4%
+13%
This is from a comprehensive marketing model from one of the largest state lotteries with sales of about
$8 billion and marketing spend of $38.4 million (middle bar). We held total spend constant at $38.4
million and reallocated from less to more productive ads. In doing so, we found that this lottery could
grow by 12.1% by following our optimized spending plan.

15. Waste results from any course or activity that drives or moves a business away from an optimal business result
1. By under-investing in the best products, business growth will be difficult.
2. By not conveying the best and most effective messages in your marketing communications, strong brands can not develop
3.. By failing to test and measure marketing’s impact, a company is flying blind and maximizes the waste in its marketing spend.
4. By getting the correct attribution across media channels, a brand avoids inefficient spending.
5. In order to improve & maximize the ROI of marketing and advertising, marketers need to measure and account for the long-term effect of
marketing & advertising.
6. Each element of the marketing-mix does not work independent of other elements. In fact, there is a large “synergy” across many media
channels; and this synergy could be up to 60% of the total advertising impact. Accurately measuring these synergies is critical for
arriving at an accurate measurement of the marketing mix; and without that guiding your marketing spending plans, your sales will fall
short of their potential.
7. Across time, effective media placement requires that weekly spending levels not be below minimum thresholds or above saturation
points. Doing so will result in inefficient media that produces no revenue
8. With some media, such as Outdoor, location plays a big role in that media’s effectiveness. Analytics needs to be applied here, in order to
find out which locations work best for your brand.
9. With media such as TV and Radio, timing plays a critical role in ad effectiveness. Here, media effectiveness needs to rely on analytics in
order to determine the best performing dayparts.
10. Many companies fail to understand what their customers like most about their brands. Adjusting a brand’s media messaging to reflect
what your customers value most will drive higher sales and profitability.
11. Brands need to position their products consistent with what customers like most about their brands. Doing so is the key to driving
sustainable growth.
12. Developing comprehensive marketing models is central to becoming a data-driven organization; and is a critical tool for optimizing
marketing spend across and within brands.

16. It’s all about Results
16
• Brought marketing ROI modeling to company for first time in 1996. In first year
developed models for Coca-Cola, Coke Light, Fanta and Sprite in 12 Countries.
– A year after this was done sales gains over prior year exceeded $300 million.
• Developed measure of customer-brand experience using social media. This model
determined Starbucks’ main strength lies in its in-store experience.
– This insight helped develop brand positioning for “Frappucino and Via Coffee” as an instore experience
versus bottled product in the counter well
– Frappuccino sales grew Starbucks total sales from +7% to +11% in the next year.
• Identified significant upside growth opportunity to drive higher restaurant sales by
investing significantly more in "dollar-value meals" one year after launch in 2005.
– Per recommendation, major & higher marketing investment in “dollar value meals” helped McD’s become
segment market leader in growth in 2006

17. Next Steps
Let’s Do this
17
• Let’s setup a 30 minute Zoom meeting. If you wish, I would be glad to sign a mutual
NDA (Non-Disclosure Agreement). During our time together, we should learn about each
other’s businesses. For you, I would love to know about your company’s products,
mission and how you do marketing. For me, I can tell you about my business and how
the analytics we do might help your business. At this point, if there are ways I can help
your business, I might make some suggestions. But there is nothing required here or no
obligation inferred.
• Should we decide & agree on any proposal, that proposal will contain a guarantee. That
guarantee will be such that we can show you a plan that will generate a certain level of
sales (usually 2%) as a condition for payment.
Thank You!