McDonald’s is an Omnicom Media Group global client. Since 1999, McDonald’s have been working with BrandScience to consistently improve their marketing effectiveness, resulting in a 70% improvement in media ROI over five years. From Denmark, the approach has been rolled out to all Scandinavian markets and is now being considered in other European markets.
Background
In 1998, BrandScience suggested that their sales models could predict McDonald’s sales better than McDonald’s franchisees estimates. Although initially skeptical, the McDonald’s Denmark Chairman is now convinced that the BrandScience dynamic, model-based forecasts are far more accurate than his franchisees’ own estimates.
What did McDonald’s learn?
Over the years, BrandScience have been able to build a marketing effectiveness knowledge base at campaign and media level. The weekly sales models factor in advertising and promotions by product type, price, distribution, the weather, seasonality, school holidays and PR. The resulting level of knowledge gives McDonald’s a base foundation of confidence when building their marketing plans. McDonald’s not only know where they get most of their money from, they are now able to document that putting extra money in the marketing plan will deliver extra sales.
How was the knowledge used?
McDonald’s use the insights to optimise the Marketing and Media calendar every year, both on a strategic and a tactical level, for every advertising medium and other marketing activity. When planning the coming year, the models are used for forecasting what level of total sales and guest counts can be expected based on different scenarios. The strong partnership between the Omnicom Media Group media team and the econometrics team helps McDonald’s squeeze more value out of every media dollar.
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