A certain retail store is starting to spend money on advertising. They have chosen to use Social Media, Google AdWords and Youtube as their preferred channels of communication.
The marketing manager would like know a few things as deliverables:
- Channel selection: Which channels are working, and which are not?
- Price elasticity: For every dollar you spend on advertising, what is the change in sales?
- Channel spend: How much of the company's budget should be spend on each channel?
The linear regression analysis showed that Youtube Ads have no significant impact on sales whereas the other 2 channels showed significance. Based on the incremental impact from the regression analysis, Google Ads had the largest impact on sales. It is recommended for this company to minimize spending on Youtube and instead focus on Google AdWords and Social Media.