How to Optimize Your Marketing Budget | by Dr. Robert Kübler | Jul, 2023


It is Time to Reap The Fruits of Your Hard Marketing Mix Model Training!

Image created with DALL-E.

Marketing mix models are a powerful tool for understanding the impact of different marketing channels on sales. By building a marketing mix model, marketers can quantify the contribution of each channel to their overall sales, and then use this information to optimize their budget allocation.

So far, I have written an entire series about building marketing mix models, yet I still owe you an article about how to use these models to optimize media spending. Today is your lucky day since in this article, I will show you just that!

Image by the author.

If you are new to marketing mix modeling, you can start with my introductory article:

Before we can optimize something, we have to build a model first. We will do it very quickly, so we can get to the main section of this article as soon as possible.

The Data

First, let us load some data. I will use the same dataset as in my old articles.

import pandas as pd
from sklearn.model_selection import cross_val_score, TimeSeriesSplit

data = pd.read_csv(
'https://raw.githubusercontent.com/Garve/datasets/4576d323bf2b66c906d5130d686245ad205505cf/mmm.csv',
parse_dates=['Date'],
index_col='Date'
)

X = data.drop(columns=['Sales'])
y = data['Sales']

The dataset looks like this:

Image by the author.

The logic behind this table is the following: imagine you work in a company that sells some product. You can see the weekly sales of this product in the column Sales. In order to boost these…



Source link

Leave a Comment