Final published version
Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Consumer attitude metrics for guiding marketing mix decisions
AU - Hanssens, Dominique M.
AU - Pauwels, Koen H.
AU - Srinivasan, Shuba
AU - Vanhuele, Marc
AU - Yildirim, Gokhan
PY - 2014
Y1 - 2014
N2 - Marketing managers often use consumer attitude metrics such as awareness, consideration, and preference as performance indicators because they represent their brand’s health and are readily connected to marketing activity. However, this does not mean that financially focused executives know how such metrics translate into sales performance, which would allow them to make beneficial marketing mix decisions. We propose four criteria – potential, responsiveness, stickiness and sales conversion – that determine the connection between marketing actions, attitudinal metrics, and sales outcomes. We test our approach with a rich dataset of four-weekly marketing actions, attitude metrics, and sales for several consumer brands in four categories over a seven-year period. The results quantify how marketing actions affect sales performance through their differential impact on attitudinal metrics, as captured by our proposed criteria. We find that marketing-attitude and attitude-sales relationships are predominantly stable over time, but differ substantially across brands and across product categories. We also establish that combining marketing and attitudinal metrics criteria improves the prediction of brand sales performance, often substantially so. Based on these insights, we provide specific recommendations on improving the marketing mix for different brands, and we validate them in a hold-out sample. For managers and researchers alike, our criteria offer a verifiable explanation for differences in marketing elasticities and an actionable connection between marketing and financial performance metrics.
AB - Marketing managers often use consumer attitude metrics such as awareness, consideration, and preference as performance indicators because they represent their brand’s health and are readily connected to marketing activity. However, this does not mean that financially focused executives know how such metrics translate into sales performance, which would allow them to make beneficial marketing mix decisions. We propose four criteria – potential, responsiveness, stickiness and sales conversion – that determine the connection between marketing actions, attitudinal metrics, and sales outcomes. We test our approach with a rich dataset of four-weekly marketing actions, attitude metrics, and sales for several consumer brands in four categories over a seven-year period. The results quantify how marketing actions affect sales performance through their differential impact on attitudinal metrics, as captured by our proposed criteria. We find that marketing-attitude and attitude-sales relationships are predominantly stable over time, but differ substantially across brands and across product categories. We also establish that combining marketing and attitudinal metrics criteria improves the prediction of brand sales performance, often substantially so. Based on these insights, we provide specific recommendations on improving the marketing mix for different brands, and we validate them in a hold-out sample. For managers and researchers alike, our criteria offer a verifiable explanation for differences in marketing elasticities and an actionable connection between marketing and financial performance metrics.
KW - consumer attitude metrics
KW - responsiveness
KW - potential
KW - stickiness
KW - sales conversion
KW - hierarchical linear model
KW - cross-effects model
KW - empirical generalizations
KW - dynamic programming model
KW - optimal marketing resource allocation
U2 - 10.1287/mksc.2013.0841
DO - 10.1287/mksc.2013.0841
M3 - Journal article
VL - 33
SP - 534
EP - 550
JO - Marketing Science
JF - Marketing Science
SN - 0732-2399
IS - 4
ER -