SAS, Scandinavia’s biggest airline, found itself faced with a corporate mandate: cut marketing costs by 20 percent to increase brand profitability. Problem was, it had very little insight into marketing’s effect on revenue and brand-related KPIs to inform where to cut or how reallocate funds. To better understand which media and non-media investments delivered the most incremental marketing-influenced revenue and ROI, SAS engaged Neustar to help.
The Neustar Solution
Neustar partnered with SAS to get its proprietary Marketing Mix Modeling (MMM) solution up and running. Neustar MMM employs regression models that measure the impact of advertising by media channels, non-media marketing activities (such as price, inventory, customer satisfaction, activities by competitors, economic factors, and more on sales), and other KPIs in a single analytic framework.
The Neustar MMM platform served as the central repository for SAS’s own granular data, including offline and online media investments, pricing, PR efforts, competitive intelligence, brand tracking, and available seat kilometers, which Neustar enhanced with a trove of rich third-party data, Those addressable and non-addressable signals then were combined into one holistic and unified model.
Neustar helped SAS conduct simulations that estimated the sales impact of a variety of campaign budget allocations and other factors. Additionally, the Neustar platform generated a guided optimization analysis, from which SAS was able to influence the airline’s media budget allocations across channels and venues.
By using the intuitive Neustar MMM interface, SAS can now conduct quarterly budgeting and media planning based around the impact of specific media investments on its total revenues and brand-related KPIs.
- Neustar helped SAS create a positive return on invested capital (ROIC), creating allocations that mitigated 49 percent of potential revenue risk due to cost savings programs.
- SAS is now able to make smarter budgeting and planning decisions guided by its ability to better understand and manage resource allocation and optimization.
- With media and creative partner reporting and intelligence now centralized, SAS has more efficient workflows and greater transparency across departments.
- SAS boosted its incremental marketing-contributed revenue by 38 percent, even with budgets