Chrysler's ace-in-the-hole: How to estimate car sales with a 99% accuracy

With an impending bankruptcy and a shrinking ad budget, how can Chrysler focus their sales strategy?

The answer turns out to be some like the Google Analytics dashboard Prof. Kagan demo'ed on Tuesday--but this one's on steroids.

The Wall Street Journals article, "Modeling Tools Stretch Ad Dollars" (http://online.wsj.com/article/SB124259801821028103.html) from May 18, 2009 gives us more insight:

A team of statisticians, economists, software engineers and media planners at Chrysler's digital marketing agency, Organic, has designed a "media modeling" system that helps the company calculate the best ways to allocate its marketing dollars. The system calculates how much ad spending is needed to meet certain sales targets and then analyzes how both online and offline ads affect Web activity and, ultimately, sales.

The differentiator is that Chrysler can micro-tweak even its offline ads based on online response data. Imagine being able to increase frequency of a hit commercial and can a dud within minutes.

Ad agencies long have used complex models to calculate the best ad spending mix, but the rise of digital media has revolutionized these systems. Instead of waiting weeks or months for data, marketers now can get them in real time, allowing them to adjust their ad spending or the creative elements of their campaigns on the fly.

There may be a silver lining to the economic crisis after all--innovative marketing techniques bred by tough times.

-Greg Bateman