New Approach for Optimizing Marketing Spending Across Brands

Information Resources, Inc has launched a new analytic service called Mix Drivers/Portfolio. Designed for CPG manufacturers who market multiple competing brands within the same product category, the service reveals opportunities to increase profits by re-allocating marketing spending across entire brand portfolios.

While many CPG manufacturers market multiple brands within the same product category to achieve economies of scale in production and marketing, as a category matures and becomes saturated with products, sources of incremental sales are increasingly hard to find. It becomes progressively more difficult to determine where to invest marketing dollars for the best return, and inefficiencies in the marketing plan inevitably arise.

Whereas traditional marketing mix models evaluate the impact of marketing activities on the sales of a single brand, Mix Drivers/Portfolio evaluates multiple brands at once. Mix Drivers/Portfolio quantifies the impact of each brand's marketing activities on its own sales and on the sales of each other brand in the portfolio. Mix Drivers/Portfolio captures both negative cannibalization and positive halo effects across brands to determine the net impact on total portfolio sales of each brands advertising, couponing, and retail promotion activity.

According to Neil Canter, Division President of IRIs Analytic Insights Group, 'CPG manufacturers are turning from brand management to portfolio management. They are scrutinizing the impact of each brands marketing activities not just on that brands own sales, but also on the sales of other brands in the company's portfolio. The Mix Drivers/Portfolio service addresses this emerging need. Anyone who manages multiple competing brands should take a closer look at how they are allocating marketing dollars across brands. There is probably room for improvement, and Mix Drivers/Portfolio provides an efficient, objective way to measure and increase total portfolio ROI'.

For more information, visit www.infores.com/public/us/prodserv/us_prd_driver.htm

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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