Budget setting for a major insurance brand

The marketing director felt that marketing of the brand should be moved away from the traditional, short term 'direct response' focus to a more long term 'brand' approach.

A major insurance brand, being a subsidiary of a much larger multinational insurance house historically had its marketing budget set by its parent company. Whilst the brand had historically performed very well, the marketing director of the brand wished to push performance even further by optimising both the budget level it received and the way in which this budget was allocated across marketing lines. 

The major insurance brand therefore wished to understand how its current marketing strategy was working both in terms of creating a short term uplift in insurance sales and in terms of altering longer term brand perceptions. The marketing director wished to use these learnings to both optimise the way in which the existing marketing budget was used in terms of marketing line and product split, as well as use it to build a case for increased investment in the brand.

Business Science used the insurance brand's data to create a series of models geared toward measuring both the short term and long term impact of marketing spend. Models were therefore constructed to measure marketing spend performance right through the 'purchase funnel' by measuring the impact of spend on upper funnel metrics such as awareness and consideration through to quotes (the 'attraction' role of marketing) and ultimately sales (the 'conversion' role of marketing). Moreover, through analysis of how historical responses have varied as the level of investment has varied, Business Science were able to develop a series of response curves for the different marketing investment types by sales channel and product. These marketing response curves were brought together to create a marketing optimiser that allowed the insurance brand to examine how spend should be allocated across the different products, channels and marketing initiatives. The marketing optimiser also enabled the insurance brand to examine what level of budget would be required to reach the brand performance targets that had been set.

THE RESULT

Business Science's work enabled the insurance brand to optimise their current investment strategy by allocating budgets in the most efficient way across the different product, channel and marketing investment lines, thus boosting the profitability of the brand. In addition, the marketing director was able to use the work to prove a case for additional investment in the brand, something which resulted in a 19.2% increase in budget allocation from the parent insurance house.