Market modelling, A/B testing, network theory and social network analysis, and spatial analysis are some of the
techniques used for optimizing and analysing elements of the marketing mix, for instance, advertising on the internet.
Market Modelling
Many theories abound in
marketing on subjects like advertising, brand equity, product optimization,
pricing, promotion and so on. Market models “operationalize” these theories
into practical solutions using a set of predictive modelling techniques such as
regression for instance, to construct models that predict the probability of an
outcome.
Market modelling is extensively used in areas such
as market segmentation, brand equity analysis, advertising effectiveness, price
optimization, promotions evaluation, etc. (For details, refer to Chapter
Marketing mix Modelling).
A/B Testing
A/B testing (aka
split testing or bucket testing) is a technique where a control group is
compared with one or more test groups, to determine which treatment produces
the best results. Examples in marketing include controlled store tests, controlled website tests and copy testing of online advertising.
When more than one variable is simultaneously tested (A/B/N testing), multiple
test groups need to be formed. In such instances the use of big data helps to
ensure that sample sizes are adequate to detect meaningful differences between
the groups.
Network Theory and Social Network Analysis
Network theory is a branch of
computer science concerned with the relationship between discrete
objects. Applications of network theory include logistical networks, gene
regulatory networks, metabolic networks, social networks, epistemological
networks, etc.
Social network analysis is an application of network
theory to analyse social networks. For instance, how information travels in a
community, or the influence one individual has over others. Applications
include identifying opinion leaders to target for marketing.
Spatial Analysis
Spatial analysis or spatial
statistics is the study of topological, geometric, or geographic properties of
objects. The propagation of geographic information systems (GIS) is driving the use and application of spatial analysis in marketing and operations research,
for instance, the optimization of the location of stores based on the movement
and buying behaviour of target consumers.
R
The R language, an open source
programming software environment for statistical computing and graphics, is
widely used for developing statistical software and data analysis. It is part
of the GNU Project, a collaboration that supports open source projects.