Advertisements in search engines and website banners, social media ads, direct mail marketing – even though the proportion of online advertising is growing rapidly, the offline segment in marketing is still very strong according to Statista: in Germany alone, revenues for offline advertising, e.g. flyers, advertising boards, bulk mail etc., amounted to €24.1 billion in 2021, while online revenues made up €22.2 billion. For the year 2022, the authors of the underlying study expect a further increase in online marketing to around 23.9 billion euros, the offline segment will comprise an estimated 23.8 billion euros. So there can be no talk of a decline for a long time to come. But how does one know whether the investment in offline marketing is worthwhile at all? In most cases, there is a lack of traceable touchpoints and measurable KPIs to substantiate the benefits. Marketing and sales departments must therefore all too often rely on their gut feeling and proceed on the “pay and pray” principle: invest in campaigns and pray that the desired effect materializes. In times of growing pressure on marketing budgets, this hopeful attitude is no longer sustainable.
Measure what could not previously be measured
Until now, the only tests in the offline sector have been A/B tests as a means of finding out what effect promotional inserts have, for example: certain target groups see them, while others do not. Then the impact on sales is compared. The disadvantage of this is that if the measure has a performance impact, it does not take effect in the excluded regions and sales potential goes untapped. This is a high price to pay for a gain in insight. What’s more, these complex tests can only measure all the possible combinations of degrees of freedom very slowly and painstakingly.
Transaction and marketing data and suitable machine learning algorithms can be used to calculate individual revenue baselines and thereby measure the performance effects of campaigns. The details of the local context are taken into account, such as vacation periods, bridge days, freak weather or Covid restrictions. The effect on online sales can also be ascertained in the same way, allowing for explanations of the impact of all advertising channels on omni-channel sales. Ultimately, this allows companies to use their entire advertising budget more efficiently.
Integrated monitoring of a company’s marketing mix
The right mix of off- and online advertising is crucial for successful marketing. Since there has been a lack of data-based evaluations of the ROI of offline measures to date, there is considerable potential for efficiency here that has not yet been tapped. This can now be leveraged using data and AI: businesses can transparently monitor the performance of all their measures and optimize their marketing mix in a more integrated way. This allows for effective multi-channel & cross-marketing. It also facilitates greater integration of marketing planning with supply chain planning.
Transparent marketing & sales planning with Comma Soft:
- Cross-industry expertise from more than 4,000 projects in the midmarket & corporate environment
- Numerous implemented use cases for marketing, sales & corporate planning
- In-depth expertise in data science, AI & machine learning
- Dovetailing of business, data & IT strategies
- Strategy, consultation, development & rollout from a single source
For solutions around data-based marketing, sales and business planning, we work closely with our partner just experts. If you would like to discuss these topics with the experts, please contact Dr Andrej Fischer: You can get in touch with him here.