Working out marketing return on investment Brands, Media and Money Counting up The classic way of checking for payback is simply looking at the sales- did they go up? A few problems with this; what else went on at the same time?, were the sales “bought” at reduced prices (so the business gain was negligible) and over what time period should gains be measured? (brand effects are usually slow hits not quick hits). Econometrics A good, and increasingly common, way of sorting this out is econometrics - which takes all the factors into account (or at least those you have data for). In the graph opposite you can see the relative effect of ads, prices and price ads! But sometimes you don’t have the data and sometimes econometrics “under records” brand effects....so... Conjoint An alternative method is to use economic conjoint  - which works out the cash value of brand preference (called “willingness-to-pay). In work done for RTE in Ireland we found consumers were willing to pay 16% more for M&S chicken than for ostensibly similar meat from a store with a weaker brand ( Store E). Moreover M&S converted its marketing budget far more efficiently than its competitors. The bottom graph shows our proprietary “bang-for-buck” index - a very useful new measure of marketing ROI. : Marketing econometrics Conjoint brand valuation <<<< Back to menu