Perhaps the most important decisions marketers face on a regular basis involve setting and defending their budgets. Two major questions arise here: How much should I spend in total?  (Budget Sizing and Justification) and “How should I allocate my budget? (How should that spending be split across media, market segments, geographies, products and time?--Budget Allocation). Both decisions have both economic and personal/organizational implications.  With the increasing focus on and use of marketing metrics, it would seem that today’s marketers would be able to make and justify such decisions scientifically and systematically. Yet, for a variety of reasons, such decisions are still largely being made today based on rules of thumb (“% of anticipated sales”) or inertia (“% increase from last year with the same allocation”).

There is a better way. Even in the absence of hard data, studies have show that what we will refer to as the “tribal wisdom” approach to linking marketing inputs (spending levels and allocations) to market outcomes (levels of awareness, preference or purchase) can increase those outcomes by  5% -10% or more with little or no additional spending.

In this webinar, Dr. Lilien will review the response model approach, linking marketing spending decisions to market outcomes and show how it has been applied in a number of industry-contexts. He will introduce a tool called ReAllocator, part of the Marketing Engineering for Excel (ME^XL) toolkit that is designed to implement this approach. He will conclude by discussing how participants can make immediate use of the concepts and the related software.