Want to measure the effectiveness of your marketing communications? Here the Black Swan A-Team tells you how!
After a big investment in your marketing campaign, you see your sales soaring. Great! You think. It must have worked! However, at the same time, the 5 days of UK summer appear, your competitors have stopped advertising as much and your sales team has secured new distribution channels for your product.
So, did your marketing strategy really pay back?
To answer that you need an econometric marketing mix model.
Econometric models take tons of data and transform it into actionable insights. One of these insights is understanding how many of your sales can be attributed to your marketing campaign. With the right data, you can also find out how many sales you lost to your competitors, or if you need to improve your distribution channels.
In addition, these models provide a way of testing your sales evolution when there is a change in price, promotions or marketing.
Econometric models are not new, but they are difficult and time-consuming (hence expensive) to develop. In any given market, there are probably tens of thousands of variables and combinations to consider. To understand all your portfolio sales drivers you will need A LOT of models! That’s why Black Swan has deployed the A-Team to tackle this problem.
An Econometrician, a Developer and a Data Scientist came together to develop ‘miniconometrics’ (minimalist econometric models). This algorithm is capable of producing hundreds of econometric models out of your day-to-day laptop with only 1-click interaction. Its efficiency comes from being powered by a machine learning algorithm that chooses a limited number of variables from that pool of maybe tens of thousands plus. All chosen variables pass sanity, correlation and statistical checks before they are incorporated into the final model. This process guarantees the model’s quality and prevents spurious relation appearing.
So next time you want to know where your sales went to, contact the A-Team.
Alexander Geuder: Software Engineer for the Data Science team, splashing practical convention in theoretical chaos
Rafael Fernandes: Data Scientist, problem solver and self-proclaimed master of the dance floor in Brazilian Zouk dancing