Retailers and other marketers are pressed to do more promotion, reach more customers and deliver better returns. Taking into account changes in the economy, promotional time period, store openings and closings and other factors, producing an accurate baseline against which to measure Return on Investment can be challenging.
“Some companies commit themselves to repeating past promotional activity because of the way they measure themselves, not necessarily because of the fact that it works,” says Brian King, VP of Marketing for fast growing motorcycle parts and apparel retailer Cycle Gear. In this episode of Moneyball for Marketing, Brian shares his thoughts and strategies on measuring, managing and optimizing promotional marketing activity. Key go to market advice offered includes the following:
Media mix modeling: “Media mix modeling is a tried and true methodology… of seeing how different activities give you in terms of the dollar contribution the margin contribution, and then your return on investment,” says Brian. He explains why other popular methods of measuring results don’t work, and how MMM can deliver better insights on true ROI.
Doubling down: “I’ll get four to five times stronger ROI from email programs, but then I’ll get no where near the same scale as out of a direct mail or catalogue program,” shares Brian. He compares online and offline promotional advantages, advises using both and counsels how to prevent unsubscribe rate increase through market segmentation.
Promotion personalization: Brian shares how Cycle Gear segments its audience and delivers personalized promotional offers from 200 items according to market segment. He reveals the machine learning technology Cycle Gear uses and discusses approaching the go to market “Nirvana” goal of a “segment of one.”
Read the full transcript here
Glenn Gow is an expert in marketing performance, Coach, Board Advisor, Author, Speaker, Podcast Host and Founder & Advisor of Crimson Marketing. Follow me on Twitter, LinkedIn, Google+. To get a free copy of Crimson’s One-Page Marketing Metrics Funnel, visit here.