What is a ROMI Analysis?
A Return on Marketing Investment (ROMI) analysis helps organizations understand the effectiveness of their marketing spending. A ROMI analysis examines business results in relation to a specific marketing activity. The benefit of this knowledge is that it allows marketers to focus their dollars on programs that provide the greatest return.
When would you use a ROMI Analysis?
The findings of ROMI analyses can help determine:
- Which marketing activities are most effective? Which ones don’t add value?
- In what areas of marketing are spending levels too high? How should funds be reallocated?
- What external market conditions (e.g. unemployment) affect marketing’s ability to generate results? How does competitive activity impact the required level of marketing investment?
- How should incremental funds be allocated?
A ROMI analysis, utilizing robust data mining tools and processes, can reveal patterns about how and when customers buy. This information can be highly valuable in predicting sales and formulating relevant marketing strategies.
Calculating Return on Marketing Investment
Optimization Group’s data mining and modeling process consists of four phases:
- Definition – To assure the results are important and relevant to the goals of the organization, we guide you in:
- Defining the marketing activities that the end result will be measured against
- Defining the data that is required to complete the analysis effectively
- Defining any environmental variables that may be appropriate for the analysis
- Defining the anticipated action steps to be taken based on the answers
- Data Collection – To assure conclusions are based on accurate input, we work with you to:
- Identify and collect all the available data.
- Clean and normalize the data
- Data Analysis – We use sophisticated data-mining tools like TheGMAX™ and Salford System’s SPM to quickly discover relationships in the data, including:
- Identifying meaningful variables and interactions
- Presentation of Results – Once completed, we deliver the results in a format that is clear, concise and, most importantly, actionable.
How Our Return on Investment Analysis is Different
All return on investment analyses are not created equal. Our ROMI analysis offers:
- Support for the organization in finding, collecting and organizing the data required, a critical element of the analysis
- Our expertise in applying a wide variety of tools to marketing data
- Proprietary data modeling tools
- Our expertise in interpretation across multiple businesses