How much should we spend on marketing each brand/sub brand?

Geographically where should I focus my marketing?

What is the best time of the year to initiate the marketing programs?

What channels should I consider for my marketing?

These are the predicaments of a typical Marketing Manager. Today, managers are facing the challenge of optimizing their media budgets and allocating into the most profitable marketing and media channels. They also have increased pressure to demonstrate clear marketing return on investment.

The primary interest is, how best to allocate a fixed advertising budget among various media including Television, magazine, radio, internet etc.

Developing an integrated Marketing Optimization Plan is a good place to start. A suitable regression model can be developed to estimate the effect of effectiveness of advertising and promotion expenditures, baseline sales, price of products on ROI etc.

Longevity effect of advertising can be considered for various media. E.g. Specified proportions of TV GRP effects for the current and previous weeks can be used in the model.

A suitable optimization technique accounting for the constraints on total budget allocation can be used to find the optimal spend on advertising and marketing activities in order to maximize the ROI. Thresholds can be obtained from the model for each of the media sources.

An optimal advertising calendar can be provided to achieve increased profit using the spend pattern suggested for advertisement and marketing activities. Marketing activities that drive sales and profits can be understood. Key drivers of baseline sales volume and incremental sales volume can be identified. Thresholds for GRP can be provided for each media source.