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Case Study Optimized Media Planning Contributes to Double-Digit Revenue Growth

2 minute read | July 2012

The proliferation of media channels and devices makes it more challenging to find the right marketing mix to reach the right consumers at the right time and place for maximum return on investment. Adding to that challenge, media costs are rising and marketing budgets are often tight due to economic realities.

John Reynolds, Marketing Analytics Manager, Recreational Equipment, Inc., (REI) discussed how fact-based insights helped contribute to double-digit revenue growth over three sales cycles. Speaking at Nielsen’s recent Consumer 360 event, Reynolds said one of the primary reasons for success was the ability to measure every marketing tactic in a meaningful way and take action accordingly.

Granular insights are vital

Justifying where to put marketing dollars requires fact-based insight across all media platforms for all sales channels. This means that the lift of traditional media (TV, direct mail, radio, print, etc.) must be measured not only by retail location, but also by online sales activity in each designated market area. Likewise, the lift of digital media (email, display, search, etc.) must also be measured for both online and retail site locations.

Understanding this level of granularity is especially true for a retailer of outdoor gear like REI where customers may see an online ad, but need to go to the store to physically try on or test the equipment. Overcoming the “fallacy of last touch” and capturing the true source of an incremental purchase is essential for successful strategic and tactical planning.

Same budget, better results

Optimization starts by looking at where each tactic is on its diminishing returns curve. If advertising performance on TV is on the flat part of the growth curve and performance on online is on the steep part, then optimization will shift dollars from TV to online. By understanding the ROI of each program during key times of the year, REI was able to make strategic shifts in marketing to support specific events.

“Not only have tactics been measured and adjusted to improve marketing efficiency, but where each tactic is used is also optimized as well,” said Ross Link, President, Nielsen Marketing Analytics. “In some markets, radio works best, in others it is newspaper and for others it is TV. Some markets get support from all three. One of the advantages of custom optimization is that we can “override” the math to make sure strategic goals are met.”

Continuous improvement = improved performance

Custom optimizations allow you to know not only where your marketing dollars went, but also where they should. Access to granular data across all media platforms is the only way to increase the precision of your strategic decisions. But you can’t stop there. You need to continuously refine and improve based on the ever-changing environment.

Learn more about media planning and media costs.

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