over $80 bn
- North America
- Marketing insights
- Promotion effectiveness
- Sales forecasting
- Advanced analytics
- Data visualization
- Predictive analytics
- Scaled analytics
Insightful analysis to estimate event sponsorship’s influence on sales
Large consumer products company among the top 35 of Fortune 500 companies; reporting annual revenues in excess of $80bn for 2014; over 110,000 employees, and in excess of 70 production sites, exporting products to over 180 countries.
The client is a consumer packaged goods company serving all over the world. They manufacture many high-quality brands familiar to households worldwide. The client is heavily involved in CSR and sponsorship activities that increase awareness and customer loyalty. One of the most important events is the London Olympics sponsorship that is expected to have a positive impact on sales results as well. The main purpose of the analysis was to find out if they achieved a significant increase in-market performance thanks to sponsoring and more intensive promotional campaigns during this period.
The evaluation of promotional campaigns is an ongoing activity in most businesses of the CPG market. The econometric models are quite complex, as countless factors could influence sales especially in event-driven promotional periods.
Identifying the statistically significant changes in in-market trends during the London Olympic Games to measure the intensive promotional campaign’s influence on sales is challenging. The trends should be cleared from seasonal components and from their key driving factors to get to real conclusions.
By determining the measure of the trend’s change users are able to evaluate the effectiveness of the promotion campaign and decide on future sponsorships, i.e. Sochi Olympics.
First of all, an estimation of a baseline for main market measures is necessary to get a proportion factor. The business question to answer was: How would the sales look like without supporting the London Olympics? Then the actual data were compared to the results to come up with conclusions regarding the sponsorship and to enable the client to define future strategy.
The process of the analysis:
- Decomposing in-market trends and eliminating seasonal part and noise.
- Using multivariate adaptive regression for predicting data during the Olympic Games. Comparing them with actuals to get information from the impact of the specific event.
- Measuring the significance of the factors by the prediction.
- Implementing Q test for identifying outliers and Bayesian hypothesis in order to evaluate promotions.
KPIs: Value sales, Value share, Volume sales, Volume share, Promotion Share, Price Index, Distribution
Overall and marketing insights – Examining the sales results combined with a picture on distribution, pricing and promotion gives an overall understanding on the market performance of the company during the specific event and period. The insights can be turned into action, both value and volume shares can be increased and marketing activities can be improved.
Predictive sponsorship tracking – The analysis gave insights to sales and share trends and enabled comparing the market in both scenarios, i.e. with and without Olympics sponsorship. Based on the findings it is worth to sponsor the Games. As a result of the service, the client was enabled to have direct positive impact on effective marketing planning and to make predictions for the next, i.e. Sochi Olympics sponsorship.
Reusability and scale up potential – The analysis is available for regions, countries, brands and categories according to the requirements. The models and the methods can be easily adapted to any other critical direct campaigns, regions, business units, to scale up and to leverage the assets based on the learnings. With the solution, it is possible to plan and analyse any other sponsorship or event from local to company-wide levels.
Resource optimization – With the analysis, the company has a ready solution and the opportunity to build in the conclusions. The client can track the sponsorship, the performance of the certain brands and improve the campaign to be able to have a more effective marketing planning with less resources, right sponsorship levels, most relevant products and less time needed in the future.