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Case study - improving marketing ROI at Universal Music through Artificial Intelligence
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Case study showing how Universal Music has automated its weekly media analysis using Artificial Intelligence and is getting better results and lowering costs
Transcript of Case study - improving marketing ROI at Universal Music through Artificial Intelligence
1
About Universal Music
♫ Global music market leader:
♯ 6 of the global 10 best selling tracks in 2009
♯ market share 27% in 2008
♫ Market leader in four of the five largest music markets
♫ UK market leader in 2009:
♯ 2 of the 5 best selling albums in the UK in 2009
♯ 33% market share for all albums
♫ Labels Polydor, Mercury, Island, Motown, Decca etc.
♫ Artists include U2, Lady GaGa, Elton John, Metallica
and Amy Winehouse
2
About Media Buying at Universal Music
♫ TV advertising is a key sales driver:
♯ over 1/3 total marketing budget on TV
♫ Marketing mix differs widely from album to album
♫ Each label responsible for managing its own budgets
♫ TV advertising budget is set on a project by project basis
♫ Budgets and spot allocation modified on a weekly basis
♫ Weekly Albums Chart gives immediate gauge of response
♫ How to separate TV response from other drivers?
3
Media Buying is a Source of Worry for Clients
Of the 50 largest advertisers in the world:
91 percent consider the media buying process
insufficiently transparent
85 percent are convinced their media agency
has deals outside the client agreement
74 percent said these deals cause bias in the
choice of media and recommendations
Source: CMO Council 2009
AdNav
Agency / Client
Ad Nav our Robotic Media Advisor
Brief Plan/Cost Buy Execute
What-If Reconciliation
Billing
ResultsLearnings
Our “Robotic” Media Advisor uses Artificial Intelligence
to produce over 1000 models annually
Comparison of Approaches
Media Agency + Audit/Model + AdNav
Timing 9-6 x 5 x 52 1 x 1 x 1 24 x 7 x 52
Media effectiveness Gut feel High level patterns Detail of every spot
Media invoice
reconciliationTrust As and when audited 24 x 7 x 52
Media plan
assessmentTrust
As and when audited
& contract24 x 7 x 52
Learning and
improvementLimited
As and when audited
& delayed24 x 7 x 52
Costs (function of
“spec”)As per contract £50k - £100k p/a
£100k build
£50k p/a
Benefits Function of deal book [say] 2-10% 10-30%
Illustrative Results
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CPU
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Day Time Station Programme Adspend IncSales Cost of Sale
SUN 21:00 C4TV BIG BROTHER 10 HOUSE ACTION 5,000 500 10.00
MON 21:00 E4 DESPERATE HOUSEWIVES YR 2 500 100 5.00
MON 21:00 E4 DESPERATE HOUSEWIVES YR 3 600 120 5.00
TUE 21:00 LIVING GHOST WHISPERER S04 80 40 2.00
TUE 21:00 MORE4 WEST WING YR 7 US O5/06 700 350 2.00
WED 21:00 E4 YOUNG SEXY AND...RICH 100 40 2.50
WED 21:00 E4 DESPERATE HOUSEWIVES 400 160 2.50
WED 21:00 E4 ONE TREE HILL YR 6 1,000 400 2.50
THU 21:00 C4TV BIG BROTHER'S LITTLE BROTHER 4,000 500 8.00
FRI 21:00 C4TV UGLY BETTY YR 3 - CRIMES OF FASHION 2,500 250 10.00
FRI 21:00 LIVING FOUR WEDDINGS 200 20 10.00
SAT 21:00 C4TV BIG BROTHER 10 HOUSE ACTION 10,000 500 20.00
Campaign A
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What explains this peak?
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Before
Business Unit
Contribution
gained
Contribution
lost
Net
contribution
A 200,000 (150,000) 50,000
B 400,000 (200,000) 200,000
C 500,000 (250,000) 250,000
D 300,000 (500,000) (200,000)
E 200,000 (100,000) 100,000
Total 1,600,000 (1,200,000) 400,000
Eight week period
After
Business Unit
Contribution
gained
Contribution
lost
Net
contribution
A 150,000 (50,000) 100,000
B 350,000 (50,000) 300,000
C 450,000 (100,000) 350,000
D 250,000 (150,000) 100,000
E 150,000 (50,000) 100,000
Total 1,350,000 (400,000) 950,000
An improvement of
£550kA reduction of
£250k
An improvement of
£800kEight week period
Is this approach for you?
18
AdNav – Good client “fit”
Heavy media user
Sales responses are at least as important
as brand building
Sales data is available daily and by region
Media plans are reviewed and adjusted to
fit changing market conditions
Data accuracy
Feasibility Study
Data variation
Data availability
Check Inter-Correlations
Feasibility Study
Build One-Day Model
Find Correlations
Feasibility Score Card
Issue Score
Data Availability
Data Accuracy
Data Variability
Correlations and Inter-correlations
One Day Model
Total marks out of 100
About VBMF
VBMF
£ Consultancy established in 1989
£ Combining analytical and systems expertise
£ Academic input maintains us at leading edge
Cass Business School
The business school for the City of London
High in the research league tables globally
International mix of students from 60 countries
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