A marketing mix model is the analysis of all the marketing activities considering the various metrics of product growth. It basically measures the success or failure of a product. The four important elements of marketing mix models are Product which can be a product or a service, Price that the customer pays, Promotion which are the marketing strategies that the firm undertakes and the Place where the product is sold and delivered. Moreover, marketing models assess various marketing activities to check if these strategies have helped in increasing ROI.
Marketing mix is the process of analysing marketing initiatives and their corresponding outcomes. For example, consider a Product A which could be a product or a service that satisfies the customers’ needs. Next, look into the Price which is the amount that the customers would be paying for the particular product. Collect the marketing details for the product over a period of time, like the advertisements and forums which come under the category of Promotions. Also consider the Place where the product would be sold and how it is delivered to a particular place is important for building a model. Now, using the direct sales and few other factors, a marketing mix model is built.
Marketing mix optimization is the process of selecting a feasible solution after considering many possible solutions. The problems are categorized into different sections like nature of variables, equations involved, number of functions and many more. Analysing various factors classified into categories helps in finalising the solution after proper consideration.
Marketing mix modeling analyses the product performance of a company. For this, there are a set of metrics allocated to evaluate the performance by drafting a model. The metrics could be the base price of the product, sales price, discount, average sales and many more. These set factors are together analysed and the model differentiates between marketing activities and other base factors to check the efficient functioning of the product in the product.
Marketing mix model is the process of checking the performance of a product. There are a few metrics like sales price, discount, average sales, etc. These values are assigned for coming up with an equation for the model. With the model data, marketing plans are reviewed and necessary changes are made if needed.
Marketing mix models require the consideration of many factors like direct sales, Average sales, product promotion and discount to optimize the data. The data is collected for a particular period of time say, weekly or monthly. With the optimized marketing data, companies analyze their marketing strategies and refine their plans accordingly.
To build a marketing model, firstly, decide the objective of the model. The objective can be anything like increasing the sales. Next, fix the model variables like product spends, sales price, etc. These variables should be optimised. Later, finalise the model constraints that define the relationship of these variables. Then, identify the algorithms for optimization depending on the type of problem.
There are a few limitations for the marketing mix model like obtaining accurate data is difficult and there is no particular standard to create the model. Moreover, this method is highly time consuming and also costly.
Marketing mix modeling is the statistical analysis of the performance of a product depending on the product’s marketing strategies whereas, attribution is a subset of the marketing mix model that analyzes the digital marketing channels.