October 7, 2024

By Dr. Shashank Shekhar Sharma

In the previous article we defined base sales as the consistent, ongoing sales a brand would achieve without any additional marketing efforts. Incremental sales, on the other hand, are the sales generated because of specific marketing campaigns or promotions. We then delved into how simple regression analysis can help separate base sales from incremental sales by plotting sales data against marketing spend. The intercept of the regression line represents base sales, while the slope represents the sales generated for each additional...

September 26, 2024

By Dr. Shashank Shekhar Sharma

As covered in previous section, the goal is to measure the total incremental sales generated and use that to calculate incremental ROAS. We’ll start by establishing your baseline sales and modeling the incremental sales driven by your ad spend. Then, we’ll calculate the incremental ROAS. To do this, we’ll dip into some statistics, starting with a simple linear regression model. We’ll keep it basic for now, just looking at overall ad spend and sales. As we progress through the modules, we’ll...

September 23, 2024

By Dr. Shashank Shekhar Sharma

Today’s article is all about discovering the ultimate goal of any marketing mix modeling exercise. It’s about what any business is for: maximizing profits and returns on your investments. For brands selling digitally, especially, one key metric stands out: ROAS, or Return on Ad Spend. This metric is seen as a top KPI because it effectively measures the overall ROI of your marketing efforts. ROAS simply stands for Return on Ad Spend, and while most in the online sales industry are familiar...