A holistic approach to marketing mix modeling enables managers of brands with strong corporate names behind them to think more strategically about the overall portfolio.

When marketers hear the words "market mix analysis," their first thoughts are often "expensive" and "time-intensive." However, to maximize the ROI of the marketing spend in an era of tight budgets, marketers must focus on how strategies for individual private label brands affect the entire brand portfolio, versus the business-as-usual, brand-by-brand approach many retailers use today.

Evaluating brand performance across the retailer's portfolio on an apples-to-apples basis isn't a novel idea, but it's also not as simple as it sounds. However, new analytics methods and solutions offered today make it more time- and cost-effective to approach a marketing mix program more holistically across an entire portfolio, enabling retailers' marketing teams to evaluate both established and new brands.

Jump-starting Holistic Marketing
A holistic market mix model "democratizes" data on specific brands, facilitating an accurate comparative analysis. It allows managers to run complex models across all brands in a portfolio and provides detailed insights into brand performance within specific categories.

To effectively roll out an effective holistic marketing program, marketers should make certain the following steps occur on a regular basis:

1. Strategy alignment/pre-review: Although this is an often undervalued part of the process, it's important to conduct an in-depth conversation about strategies and expectations for each brand in their portfolio. While analysis will reveal quantitatively specific interactions, it's valuable to have an understanding as to what marketers see in the marketplace in terms of execution.

2. Data review: Critical to making sure data feeds are available for activities most necessary to brand strategies, this is the point at which marketers can identify key potential avenues to investigate more deeply into the analytic exercise – forgoing it poses significant risks.

3. Results review: Analysts re-engage with marketers, evaluate the results and assess whether the results align with expectations set in the first part of the process. As the most iterative stage of the process, it can be frustrating for marketers who are eager to roll out their campaigns, particularly from a portfolio perspective. But it's a necessary evil to ensure marketers don't go into the market blind.

Maximizing the ‘Halo' Effect
Considering the fifth "P" – portfolio – reaps many benefits, such as providing insight into which private label brands have the best growth opportunities. However, marketing leaders need to be aware of trade-offs across the interbrand competition that inevitably exists.

For example, a portfolio-based analysis approach might enable marketers to identify a more effective mix of advertising and promotion campaigns to drive a greater share of basket gain than a series of brand-by-brand campaigns. The portfolio-based analysis allows the marketer to identify and leverage the "halo" effect, or the benefit one brand within a portfolio receives from the brand equity of other products within the portfolio, of its private label brands.

A holistic approach to marketing mix modeling enables managers of brands with strong corporate names behind them to think more strategically about the overall portfolio. This approach also allows managers to maximize the halo effect.

While the extra level of analysis may seem daunting at first, it reveals new information that drives greater cost-effectiveness and improved performance – both critical in an era of channel shifting and tightened belts.

Patrick Moriarty is analytics executive and global portfolio leader for symphony analytics at Chicago-based SymphonyIRI Group Inc. He can be reached at patrick.moriarity@symphonyiri.com.