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Andreas Hofmaier and Econometrics in Post-corona Times

8. 4. 2020, 9:30

"Having robust analytical information available for critical decisions is of the utmost importance in any crisis", says Andreas Hofmaier, Managing Partner at SAYG GMBH.

1) Is there any actual impact of the current situation on econometrics, as a ROI (return of investment) measurement tool?

Yes indeed, it is even more important than in normal times. Here is why: Having robust analytical information available for critical decisions is of the utmost importance in any crisis; even more so in this extraordinary one. Many companies are currently reviewing their marketing investments. With a few notable exceptions these will / is result(ing) in budget cuts in the vast majority of cases. Getting these budget adjustments right, is mission critical. In other words: a business will suffer from lost profits, if an ineffective marketing activity is being pursued in good times. In a crisis situation like now the room for error is just not there. Hence, identifying the most effective marketing measures (which one would like to keep under almost all circumstances) and the less effective ones is something you don’t definitely want to get wrong now. Cause if you do, you would make a bad situation even worse. Something businesses can just not afford yet.

2) What will be the impact of current situation on econometrics in mid-term, as well as long-term perspective?

Well, the need for robust ongoing marketing analytics will most likely continue to grow. It is nice to do marketing mix modelling every now and then, but the real value will only be unlocked, if it is done on a regular basis. One can see this clearly now: if you do it adhoc, this is of course better than not doing it at all; still you are losing critical time (as the preparation period can only be squeezed so much). On the other hand, if you are able to build on a solid existing analytical base, model adjustments to account for this and any future unforeseen events can be done (if it is done in the right way) on a near real time basis; i.e. within a day / a few days max. This will give those who are prepared a critical edge. You can see this unfolding in real time now.

3) Have you changed your working habits in communication with your business partners during past weeks?

Sure, the internet lines are red hot. Of course any personal contact is digital for the time being. Naturally online meetings had been done before this crisis too, but now 100% is / has to be digital. I believe, we should be fine as long as the internet doesn’t break down. It hasn’t so far (kudos to our telcos), so I am fairly confident, we will manage accordingly. Having said that, some things just work way better (and more efficient) in a personal meeting. So I am looking forward to face to face meetings again in the hopefully not too distant future.

 

PETR MAJERIK
media coach