What is Slope? – Data Science for CMOs episode 1
Christopher Engman, CRO/CMO at Proof Analytics explains the marketing analytics term “slope” and why it’s good to understand slope in marketing.
Slope is a very common regression analytics term, or Marketing Mix Modeling term. In this example the x-axis symbolises how much we spend on retargeting. On the y-axis we have sales. When you increase your spend on retargeting, if you have a positive slope, the angle will get steeper and steeper. This means that for every dollar you increase the spend on retargeting, the sales increase is very fast. If the slope is low, the sales increase is very little per increased spend on retargeting. Slope can also be called “multiplier” if you increase your spend in one channel, how much or fast will that spend miltiply to sales? If you put one dollar in and get 7 dollars back you have a slope, or multiplier effect of 7.