An Australian-developed campaign tool is saving Mercedes-Benz millions

A researcher from University of Technology Sydney collaborating with Mercedes-Benz has developed a new approach to managing campaigns that has the potential to drastically cut costs and increase effectiveness.

The tool helps brands track effectiveness of ad efforts by medium, and therefore choose what portion of marketing budgets to apply across TV, online, and print.

The approach, which has tested successfully for Mercedes-Benz new model launches in Germany, involves surveying the actual media consumption habits of a representative sample of target customers.

This can be matched with media plan during the advertising campaign, then measures the behavioural response of those target customers to the campaign, and finally, analyses and recalibrates results.

The tool converts aggregate ad spending into ad spending at the level of the individual and untangles the relative contribution of media channels to a campaign’s success.

The launch campaign of a new car model is typically difficult to measure as they usually only last weeks or a couple of months, but do not have an immediate effect on sales, which unfold in the long term.

“We created a single-source database that can estimate advertising effects in near real time,” says Professor Marc Fischer, developer of the system and member of the Marketing Discipline Group at the University of Technology Sydney Business School.

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The approach has already been applied to several product launches since 2012, including for the new A Class. A key insight was that while online media should be strengthened, extra spending should be diverted from print, and not from TV.

By going against the conventional wisdom that advertising should be moved from TV to digital, the strategy has saved Mercedes-Benz up to 2 million Euro per campaign.

Fischer’s study, ‘Managing advertising campaigns for new product launches in the automobile industry: an application at Mercedes Benz’ was recently named a finalist in the 2015-’16 Gary Lillien ISMS-MSI Practice Prize.

 

 

Ben Ice
BY Ben Ice ON 17 August 2016