August 18, 2015

Multi-channel Marketing Mix optimisation


The Situation

A substantial insurer selling directly to consumers uses budget allocation software to optimise recruitment ROI across channels

The Client’s Business Goals

  • To use historic campaign performance metrics combined with a channel mix performance model to inform budget allocation
    • To trial our budget allocation software called BAT to optimise the way that money is allocated over 300+ activities each year
    • To use the redistribution of budget recommended by BAT to challenge the current allocation of marketing budget
    • To generate as a result an uplift of >5% of value from the same amount of overall marketing recruitment spend

Our Solution

  • We set up a joint team with the client to analyse historic marketing campaign metrics stretching back up to three years
    • From these we developed some 20 different channel level saturation curves showing how ROI declines in any channel as spend is increased
    • The historic metrics, combined with channel saturation curves, were loaded into BAT, along with the client’s multi-channel mix performance model to handle halo effects and re-attribution of some of the web demand
    • We used BAT to run optimised budget distribution scenarios, introducing cut-offs at an activity level in terms of minimum and maximum permissible spends
    • We then undertook with the client a budget planning process review to fathom out how best to introduce BAT and its outputs into the current planning cycle
    • Finally we trained the client to use BAT so that they became confident to drive it on their own

Key benefits

  • The overall business benefit was to get a substantial uplift in the value of sales from the same budget. We are not allowed to quote the uplift obtained but it gave an ROI on the cost of our software and services well in excess of x 20
    • A second major benefit was the improved speed to develop budget plans; with over 300 campaigns pa and multiple channels in play, budget planning was taking many days to complete. This has now been reduced to seconds once the parameters for a new scenarios have been set
    • Lastly BAT has provided planners with the benefit of a full audit trail; all input metrics, saturation curves used and assumptions made are documented for each scenario. Additionally the BAT tool now holds a saturation curve library for use in future planning.