Marketing Analytics & Data-Driven Decision Making Flashcards

A marketing consultant wants to measure the incremental revenue generated for every dollar spent on a campaign. Which metric best captures this?

Answer: Return on Marketing Investment (ROMI)

ROMI measures the incremental revenue (or profit) attributable to marketing divided by the marketing cost, directly capturing efficiency of spend.

Which statistical technique is most appropriate for predicting a continuous outcome variable (e.g., monthly sales) from multiple independent variables?

Answer: Multiple linear regression

Multiple linear regression models the relationship between a continuous dependent variable and two or more independent predictors, making it ideal for sales forecasting.

A/B testing in digital marketing is best described as:

Answer: Simultaneously exposing two groups to different versions of a variable to identify which performs better

A/B testing (split testing) randomly assigns users to control (A) and variant (B) conditions simultaneously, isolating the effect of a single change.

In marketing analytics, what does 'attribution modeling' primarily help a consultant determine?

Answer: Which touchpoints in the customer journey receive credit for a conversion

Attribution modeling assigns conversion credit across multiple touchpoints, helping marketers understand which channels and interactions drive results.

A data set contains customer purchase amounts that are highly right-skewed due to a few very large orders. Which measure of central tendency should a consultant use to best represent the typical customer purchase?

Answer: Median

The median is resistant to extreme values (outliers), making it a better representation of the typical purchase amount in a skewed distribution.

Which type of data analytics focuses on understanding why something happened by examining patterns and relationships in historical data?

Answer: Diagnostic analytics

Diagnostic analytics goes beyond describing what happened to identify the causes and contributing factors using root-cause and drill-down analysis.

A marketing consultant segments customers into groups based on their purchase Recency, Frequency, and Monetary value. This framework is known as:

Answer: RFM analysis

RFM (Recency, Frequency, Monetary) analysis ranks customers on three behavioral dimensions to identify high-value segments and tailor marketing efforts.