Home  Journals  Economic Analysis: Theory and Practice  5(404) - 2015 February

The factor analysis of advertizing campaigns of a multichannel retail chain

Vol. 14, Iss. 5, FEBRUARY 2015

Article PDF Version

Available online: 6 February 2015

Subject Heading: METHODS OF ANALYSIS

JEL Classification: 

Pages: 15-30

Importance The non-food retail market in Russia is actively and extensively developing in the current economic conditions. Therefore, the major traditional retailers are moving to the multichannel strategy (offline, online, social media, etc) and take the advantage of communication channels synergy while implementing a variety of advertising campaigns.
     Objectives The objective of the study is to develop an approach to improving gross margins and profitability of advertising campaigns, taking into account the features of a large multichannel retail network and using a factor analysis.
     Methods The approach bases on the deterministic factor analysis (the logarithmic method). I used a set of e-mail campaign (e-mail sending, site traffic acquisition, order placement, contact center confirm, order fulfillment and customer delivery) as factors of the model.
     Results I performed a complete cycle of advertising campaigns analysis taking into account the specifics of a large multichannel retail chain. I developed the factor analysis approach (the choice of factors in the model, the choice of the factor analysis method, the algorithm of factor impact calculation, the "element → charge → action" matrix). The paper presents the case study of the factor analysis calculation and visualization.
     Conclusions and Relevance I conclude that the factor analysis is an effective tool in the gross margin management of advertising campaigns for large multi-channel retail chains in increasing competitive environment.

Keywords: multichannel chains, advertising, e-mail campaign gross margin analysis, factor analysis, controlling

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