MARKETING MIX CHALLENGE: DECLINING DOLLARS / GROWING PLATFORMS Show graphic that of traditional media plus emerging platforms With flat/declining marketing budgets BUDGET 80% 60% 40% 20% 0% 100% MEDIA CHANNELS #C360

QUANTIFYING MARKETING RETURNS IS NOT SIMPLE SOCIAL MEDIA DIGITAL GRANULAR TACTICAL TRADITIONAL MASS REACH MEASURING SUCCESS REQUIRES FACT-BASED LEARNING #C360

MARKETING MIX IS STEP 1 GRANULAR DATA + COSTS + CLIENT DETAILS = FORWARD- LOOKING, PRESCRIPTIVE OPTIMIZATION MAGNITUDE OF RESULTS ARE SURPRISING THE SOLUTION #C360

REI – A UNIQUE CORPORATE CULTURE BIKING KAYAKING SKIINGECO- FRIENDLY CUSTOMER SATISFACTION #C360

FACT-BASED INSIGHTS = OPTIMAL RESULTS 123 ROI 59% #C360

MEASURE EVERY TACTIC IN A MEANINGFUL WAY PAID UNPAID NON-BRANDED BRANDED COMPARATIVE SHOPPING ENGINE PAID SEARCH TV RADIO PRINT TV RADIO PRINT DIGITAL #C360

MEASURE ALL SALES CHANNELS BOTH TRADITIONAL AND ONLINE COMPLETE TACTIC PERFORMANCE TRADITIONAL DIGITAL RETAIL STORE SALES REI.COM SALES BY DMA #C360

FIND THE TRUE SOURCE OF AN INCREMENTAL PURCHASE AND OVERCOME THE “FALLACY OF LAST TOUCH” EXAMPLE #1EXAMPLE #2 Assigning credit by tracking click thru patterns would incorrectly give credit to Search Marketing mix models would correctly give credit to TV Because there is no way to directly track clicks from display to retail, credit would be “lost” Marketing mix models would correctly give credit to Display KEY PROPERLY CREDITEDIMPROPERLY CREDITED #C360

3-STEP PROCESS TO ANALYZE CURRENT BUSINESS PERFORMANCE MARKETING MIX MODEL- METHODOLOGY TIME SALES DIRECT MAIL TV ALIGN SALES WITH MARKETING STEP 1 #C360

3-STEP PROCESS TO ANALYZE CURRENT BUSINESS PERFORMANCE MARKETING MIX MODEL- METHODOLOGY DIRECT MAILCoreOnlinePrintTV SALES DIRECT MAIL TV ATTRIBUTE SALES TO ACTIVITIES OCCURRING WHEN SALES INCREASED STEP 2 #C360

MARKETING MIX MODEL- METHODOLOGY 3-STEP PROCESS TO ANALYZE CURRENT BUSINESS PERFORMANCE STEP 3 ANALYZE RESULTS EXPLAIN CHANGE VS. YEAR-AGO CALCULATE ROI #C360

OPTIMIZED PLAN TV PRINT ONLINE MARKETING MIX MODELS BY ACTIVITY BY WEEK BY BRAND BY CHANNEL MARKETING COSTS AND PRODUCT MARGINS BUSINESS RULES CUSTOM OPTIMIZATIONS IDENTIFY BEST POSSIBLE INVESTMENT #C360

OPTIMIZATION: SAME BUDGET, BETTER RESULTS SPEND IN CHANNEL 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 INCREMENTAL IMPACT ROI = $1.25 TV Online Current Spend ROI = $1.42 Cut $500k Lose 2,500 units Add $500k Gain 12,000 units Optimal Spend #C360

CONTINUOUS IMPROVEMENT = IMPROVED PERFORMANCE REFINE MODELS MORE GRANULARITY NEW TACTICS #C360

MAKE STRATEGIC SHIFTS IN YOUR TIMING #C360

MAKE STRATEGIC SHIFTS IN YOUR MARKET RADIO MARKETS DIGITAL MARKETS TV MARKETS ALL TACTICS MARKETS CHICAGO MADISON MILWAUKEE SAN FRANCISCO BOISE AUSTIN BOSTON ATLANTA SAN DIEGO SEATTLE SALT LAKE CITY MINNEAPOLIS #C360

ACCOUNT FOR DIFFERENCES ACROSS SALES CHANNELS (8.7%) 2.9% BUDGET REVENUE (2.5%) 14.7% RETAIL SALES ONLINE SALES #C360

HOW TO IMPLEMENT KNOW NOT ONLY WHERE MARKETING DOLLARS WENT, BUT WHERE THEY SHOULD GO INCREASE PRECISION WITH MORE GRANULAR DATA AND MAKE MORE SUCCESSFUL STRATEGIC DECISIONS CONTINUOUSLY REFINE/IMPROVE BASED ON THE CHANGING ENVIRONMENT #C360

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