What is portfolioQED?
portfolioQED is a strategic portfolio allocation tool that helps an organisation achieve a suitable allocation of resources across dimensions such as regions, brands, customer segment and marketing channels by combining existing marketing effectiveness insight with your internal forecasts. Importantly, the recommendations will depend on the organizations preference for short-run vs. long-run success – success being defined as some blend of profitability and revenue performance.
How does it work?
portfolioQED uses an advanced Genetic Algorithm to run an Evolutionary Optimization routine capable of handling a large business portfolio with a complex set of constraints. portfolioQED’s optimizations are more realistic because the framework that houses the analysis is customized to each user’s business situation.
Who is it for?
portfolioQED is a tool for any business with the opportunity to move funds between brands, markets or tactics. The individuals using portfolioQED are those who want to make the tough decisions on where to invest based on robust objective analysis. portfolioQED improves the planning process by focusing on the things that matter most –long term revenues and profitability.
- Your Profit and Loss (P&L) account predictions plus some other standard financial data
- Your estimates – Either through econometric modelling or other methods – for the relationship between marketing investments and revenues
- Optimal allocation of resources to the markets, categories, brands and activities that will maximize your returns
- Returns can take the form of revenue, profit, or a mixture of the two
- The allocation can be for just a few months or part of a multi-year planning process
Case Study Example
A global top 10 Dairy company needed to understand how they could best allocate marketing resources across their portfolio of 16 brands operating across 5 categories.
They were familiar with marketing ROI analysis at the individual brand level but needed to apply these learnings more strategically. Their key questions were:
- What is the best way to allocate media spend for our key market across key categories given that we face a number of constraints in our business?
- What would the correct budget size be to maximise profit? How would funding of new products impact this?
ScanmarQED helped the client team execute the project over a 6-week period, which involved gathering existing modelling results and using workshops to apply these to alternative categories. Having run separate workshops with all categories, we then brought all the teams together to create new scenarios based on their requirements. In total, revenue improvements of over $20m were identified for the current year. The client is now embarking on follow-up work to project and optimize results through the next five years.
Does this sound like a tool you could work with? Contact us today and we’ll be happy to discuss options with you.