Given the variety of different media channels available – from trade media to retail media networks and beyond – brands are challenged with building a media strategy that can optimize their return on investment (ROI).
Keen Decision Solutions’ platform provides a data-driven approach that recommends a brand's optimal spending across channels that are based on real-time and historical insights, the company’s CEO, Greg Dolan, explained to FoodNavigator-USA.
Editor's Note
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Data-driven decision-making for optimized ROI
Over the last 15 years, Keen built its machine learning and AI-powered database of industry norms to combine with brands’ information and data.
The software system analyzes “all data signals across your marketing tactics” in addition to external factors against a brand’s revenue “like competition … price and distribution” to enable brands to make more strategic decisions and optimize investments to better meet future revenue targets.
Instead of focusing solely on ROI, brands should assess their marginal profitability curve and aim to optimize every dollar across all marketing tactics and time frames, Dolan advised. This means evaluating the ROI at different stages to see which exact actions or areas are the most effective.
Trade media’s declining impact
According to Keen, a 12% investment in trade media saw ROI drop by 1%. Declining ROI of trade media is due to more saturated channels and fragmented audiences, Dolan pointed out.
“Brands are seeing diminishing returns from trade media spend as the channels become saturated and audiences fragmented,” he said.
He continued, “We are noticing a trend where the returns from purely trade-focused media are shrinking. Brands cannot rely on those channels alone to achieve growth – it is just not delivering the same impact it once did.”
Additionally, companies that increased their investment in consumer promotions by 23% saw no ROI improvement, highlighting a multi-faceted approach to media investment, Dolan noted.
Balancing trade and brand-building investments
While trade media investment where sales-driving and short-term tactics like promotions has its place in a brand’s strategy, brand-building investments that tell a story and build identity will help fortify their positioning with consumers in the long run.
This might include storytelling campaigns, memorable ads or social media presence to encourage both immediate purchases and long-lasting consumer loyalty, Dolan said.
'Prepare to make decisions faster'
AI and machine learning will eventually reduce the need for manual analysis, planning and buying and ultimately increase productivity, Dolan said.
Keen’s services have shown a return for businesses based on optimized scenarios in comparison to performance if they were not using their software. The company has seen a 25% improvement in marketing performance — meaning a $10 million budget could see a $2.5 million increase in returns.
Marketers should expect this level of ROI from their providers, Dolan added.
Keen’s technology speeds up data analysis, reducing the need for large manual efforts and data science teams, which cuts costs and improves efficiency, he said. This streamlined shift in workflow will also require a “different type of work,” where marketers will also be held more accountable for financial results than in the past, he said.
“The best advice I can give to marketers is prepare to be agile. Whether [those are] the systems you have in place, the data availability to be able to utilize those systems, prepare to make decisions faster because that is what the marketplace is going to demand over time,” Dolan said.
He added, “That is going to require good data organization investment, marketing and advertising technology investment and being really strategic about those … investments.”
