Context and objectives

A leading energy provider sought to optimize its marketing investments across various media channels to enhance sales performance.

The primary objective was to quantify how expenditures across digital and traditional media platforms—TV, radio, press, search engine advertising (SEA), and social media—impacted sales. The client also needed recommendations on how to reallocate budgets to maximize sales performance.

Approach

We employed Marketing Mix Modeling (MMM) techniques, using Robyn—an open-source MMM package developed by Meta—to analyze how media spending and external events affect B2C sales. This approach allowed us to break down sales data and attribute contributions to each media channel and external variable without needing a direct attribution model.

Results

The detailed results of the Marketing Mix Model revealed several important effects of media spending on sales:

• Media Efficiency Analysis: We determined the cost per acquisition (CPA) for each media channel, revealing significant differences in immediate efficiency between digital and traditional media.

• Carryover Effects: Our analysis identified varying lagged effects of spending across multiple weeks, with certain media exhibiting prolonged influence on sales.

• Saturation Effects: We identified saturation points in specific media channels where additional spending yielded diminishing returns, indicating that increased investment would not lead to proportional sales growth.

A key breakthrough came from utilizing the model's simulation capabilities to test different budget allocation scenarios. The simulations revealed that optimizing budget allocation could increase sales by over 5% without requiring additional spending. Though simulation-based, these findings offer valuable insights that can be validated through further studies and A/B testing.

Using Marketing Mix Modeling with Robyn gave the client clear, data-driven insights into how each media channel affected sales. This knowledge enabled smarter budget allocation decisions to improve marketing performance, even during challenging times marked by energy crises and geopolitical events.