Customer Success Stories - Musti Group: ROMI and data-driven management as the driver of profitable growth
Sellforte's ROMI modeling showed that almost half of the campaign's sales are driven by external media:
- Unaddressed leaflets were the most effective medium. They performed exceptionally well for Musti.
- The ROI of leaflets improved by +50% with postal code optimization.
- Understanding the optimal media mix enabled Musti to increase its media investments by +30%.
- In addition to ROMI modeling, Sellforte helped Musti clarify its promotional strategy by defining clear roles for each individual product.
- Altogether, the cooperation between Musti and Sellforte led to a +1.4M€ increase in yearly margin.
Musti Group is the leading Nordic pet care specialist operating in Finland, Sweden, and Norway:
- Musti Group's net sales were 246.6 M€ in 2019.
- The group has 277 stores (own and franchise), and it employs 1,100 experts.
- Musti's mission is to make the lives of pets and their parents easier, safer, and more fun. In addition to an extensive product assortment, Musti provides a selection of pet care services in many of its brick-and-mortar stores.
Musti experienced an amazing growth rate during 2014-2018 (29% CAGR). In 2019, Musti wanted to analyze which marketing activities would maintain the great growth track:
- Musti uses various media channels to varying degrees, which requires advanced & continuous ROMI modeling.
- Leaflet marketing was performing very well for Musti, but areas for improvement were to be found with more thorough analysis.
- Learning the main factors behind marketing effectiveness would enable Musti to optimize & allocate its media investments.
Musti's commercial team wanted to understand, on one hand, what the main drivers behind media ROI are, and on the other hand, align the promotional strategy & activities with a sustainable growth plan.
- Musti wanted to understand how their leaflet is currently performing, i.e., how much sales and margin it is driving compared to the investment.
- The goal was to drive sales, but also to steer the marketing investment toward new non-member customers that weren't yet in their loyalty program.
- Additionally, analyzing past promotion effectiveness was required for the new product strategies.
Sellforte forecasted the leaflet ROI for each postal code area based on three independent criteria and presented a recommendation for new leaflet areas.
Sellforte analyzed the historical leaflet performance of postal code areas:
- Further independent external criteria were recognized, which had a strong dependency on ROI performance.
- By using multiple criteria, we estimated the total forecasted potential ROI for each postal code, even for those where leaflet distribution was never done before.
- Increasing leaflet distribution in high ROI areas and reducing it in low ROI areas allowed a +50% increase in leaflet ROI.
Sellforte developed a comprehensive view of which geographical areas work most effectively by visualizing store locations and ROIs on a heat map.
- The interactive heat map allows drilling into desired areas and evaluating them visually in regard to store location and realized ROI.
- Visualization of critical KPIs (e.g., share of houses, median household income, number of households) eases the strategic planning of future leaflet distribution.
To support long-term brand development, Sellforte helped Musti clarify the commercial strategy for each product, brand, and category.
- Looking at the historical performance of campaigns enabled Musti to analyze how different items had performed in campaigns, and what kind of roles Musti's product assortment included.
- Results revealed Musti's star promotions (promotions that have a great net-net sales and margin uplift effect), which played a key role on the leaflet covers.
- Additionally, the insights provided guidelines for Musti's pricing strategy.
- Cooperation led to a +1.4M€ margin uplift on a yearly level, more than doubling the margin growth rate.
- Understanding the optimal media mix for Musti and proving the results with hard data enabled a +30% increase in the marketing budget.