• by Lynn Russo , October 28, 2005

Another link has been added in the single-view-of-the-customer chain. Marketing Management Analytics, Inc. (MMA) has integrated trade promotional spending with media and marketing in a single marketing mix model that optimizes spending across both categories and "shows the roi of trade promotion alongside the roi of other media," says Vinit M. Doshi, senior vice president of mma's Analytical Solutions Group.

Busting the myth that sales would increase proportionally to promotional spending increases, the new model provides a more accurate picture of trade's value by studying forward buying (consumers stocking up on sale items) and within-week saturation (losing customers to a competing promotion for a week).

The model's marginal opportunity index assesses the response expected from various levels of spending, helps retailers understand which customers have the most upside potential, and determines which retail accounts are working best. It also tells marketers how to move budget dollars to achieve a sales goal.

Three consumer packaged goods companies have seen results to date. "They're getting a more accurate assessment of the true return on trade promotion and understanding their marginal opportunities -- something they did not have the opportunity to see before this," Doshi says.