Summary
A leading global CPG company, with a portfolio of well-established brands, partnered with Arima to understand how its marketing activity influenced in-store sales. Using Arima's high-speed Marketing Mix Modeling (MMM) platform, the team uncovered channel-level ROAS insights, identified opportunities for incremental sales through budget reallocation, and generated actionable forecasts to inform future media planning.
Challenge
The CPG marketer needed a way to quantify the true impact of its media investments across brands, markets, and audiences. Specifically, they wanted to:
- Identify which media channels were driving the strongest return on ad spend (ROAS).
- Understand where incremental sales could be unlocked through smarter budget allocation.
- Build optimal media mixes for each brand across total market, regions, and target audiences.
- Measure the contribution of external forces, including competitive activity, in-store promotions, macroeconomic conditions, and cannibalization between sister brands.
They required a unified, fast, and flexible MMM solution capable of capturing both internal and external sales drivers.
Approach
Using Arima, they analyzed two years of sales and media spend across online and offline channels to map the relationship between marketing activity and revenue.
1. ROAS & Marginal ROAS Modeling
- Historical ROAS measured past revenue generated per dollar invested.
- Marginal ROAS projected future revenue per incremental dollar while accounting for diminishing returns.
- SEM and Pinterest emerged as top-performing channels.
2. Incorporating Key Sales Drivers
Arima's MMM incorporated all major factors influencing sales, including:
- Competitive brand activity
- Major market events (e.g., lockdowns)
- In-store promotions
- Sister brand cannibalization
- Paid + owned media
- Base sales (the "do nothing" scenario)
This provided a full waterfall view of how each variable contributed to total sales.
3. Live Forecasting & Scenario Planning
Using Arima's forecasting tool, the marketer ran "what-if" scenarios by adjusting channel budgets. Insights from ROAS and sales contribution analysis guided increased investment into SEM and Pinterest.
4. Making MMM Insights Media-Actionable
Arima connected MMM insights directly into media planning via its audience and KPI simulation tools:
- An audience segment ("Consumed product past 30 days - YES") was built.
- Two fictional campaign scenarios with identical budgets were compared, varying only in media allocation.
- KPI trade-offs (reach, frequency, CPM) were analyzed against projected sales outcomes.
Result
Arima's Marketing Mix Model, including the forecasting tools, equipped the CPG with a clear, data-backed plan to optimize future investments:
- Identified channels (SEM & Pinterest) with the highest ROAS and strongest marginal upside.
- Quantified the contribution of all internal and external sales drivers, including cannibalization between brands.
- Enabled scenario planning for upcoming quarters, turning historical learnings into forward-looking strategy.
- Showed that rebalancing media allocations could increase sales by 2.4%, even with expected decreases in impressions, reach, and frequency - helping the marketer prioritize primary metrics over secondary ones.
Outcome: The marketer gained a unified view of performance across markets and brands, and actionable guidance to allocate spend more effectively moving forward.
