How you can thrive in 2025…with scenario planning

“Mirror, mirror on the wall, who’s the fairest of them all?” “Thou, O Queen, art the fairest in the land,” said the mirror, until one day it didn’t, and then, well, everything went a bit wicked in the fairy kingdom.

What’s this got to do with marketing and business, you might ask. Well, apart from the fact that all things Snow White will be BIG news in 2025 with the forthcoming Disney film reboot, the Wicked Witch is a great example of what happens when you’re not prepared for change.

She only knew how to ask one question and could only accept one response.

Now, clearly marketers don’t have magic mirrors although, in these times of rapid change and uncertainty, many might wish they had a crystal ball, because business success often hinges on the ability to anticipate and plan for future events.

Traditionally, marketers forecast the business impact of their marketing by relying largely on past data and experiences – the one question, one answer approach.

But with uncertainty being the only certainty these days, it is time to change tact. Things have always been uncertain, you might say. Political changes, economic fluctuations, technological innovation, or consumer trends are nothing new. However, the difference lies in the multitude, magnitude and speed of change we have seen in recent years.

When planning marketing budgets, this is why we see leading brands increasingly use scenario planning: moving away from planning with the one most likely future, to planning with two, three, four or more future scenarios that might unfold.

While scenario planning isn’t necessarily a new way of thinking, 2025 will see it rightly taking centre stage as the way marketers can achieve maximum ROI. Further boosted by advances in analytics, data maturity, and tech for holistic forecasting.

And for good reason: When large global brands plan ahead with data-driven simulations, they can increase their growth by up to 75% without any additional investment – according to our ROI Genome containing 25 years of data and billions of marketing spend.

And they do this through widening the lens of reference, focusing not only on controllable factors (such as marketing or operational activities), but also taking into account uncontrollable external factors, such as inflation, competitor behaviours or even the weather, alongside global factors from election outcomes to ongoing armed conflicts.

If the boardroom were to only ever ask one question, it should be: “What if?”

“What if there are supply chain issues? What if the category shrinks or grows? What if there is extreme weather?”

Digging deep into the role of external factors, how to measure them, and then using scenario planning to develop solid forecasts and agile plans will help marketers navigate the myriad ‘what ifs?’ which are undoubtedly queuing up in 2025.

So, how do you make scenario planning a success?

Think of everything – then narrow it down to what matters
Gather meaningful data about the impact of your own business activities – your controllable events – and then look outside at the uncontrollables, such as competitor activity the weather, or macroeconomic developments. What are all the factors that might impact your business success?

Only by using this holistic view and feeding appropriate data into a holistic measurement approach such as a commercial mix model – will you be able to accurately measure the complex interplay of factors and optimise what is in your control.

The next step is to then narrow it down by choosing a limited set of key scenarios to develop a plan for that are most relevant to your business. You can’t take into account everything, everywhere, all at once.

By identifying and focusing on the main potential events, you can then use your energy and resources to create an effective plan, rather than getting lost in a jungle of possibilities. This means leaving some wiggle room in your planning and drafting plans for the different scenarios – so you can adapt, fast, depending on which future unfolds.

For example, if supply chain issues are a key concern, you can simulate what would happen if production of certain products slows down – or if issues are resolved earlier than expected. And alleviate the impact via switching to appropriate media support and pricing or product strategies.

Start with clear goals, even if they change
The starting point for any strategy, no matter the circumstances, is an end goal.

What does your business want to achieve? How close will you get to this target under scenario A, B or C? Can you close gaps to target by investing more or differently in your marketing mix – or will other areas of the business have to step up too? The key is to not stick slavishly to a multi-year plan, but also not to be tempted to constantly tweak and change direction. Aim for a centre line that can match the severity and longevity of an expected change with the speed and magnitude of changes to your goals and planning.

Embrace a test and learn mindset (aka incrementality experiments)
Test and learn is a crucial mindset when trying out new things (e.g. choosing between two campaigns, or trying out a new channel), or adapting to changes. It accelerates learning and allows you to scale up faster. For the most accurate results, integrating test and learn approaches into a solid, holistic commercial analytics model is crucial. It allows you to choose the most suitable regions and control for differences that might come from demographic factors, weather, media changes and shifts in the competitive landscape. That way, the actual impact of the initiative to be tested can be most accurately isolated from other factors and deliver insight, fast. And within any given external scenario that unfolds, you can refine your plan in situ for even better results.

Reward the brave
Glorious as it would be, we know the crystal ball doesn’t exist, and no solution – no matter how sophisticated – is able to precisely predict the future. Rather than purely assessing performance based on rigid targets, success will come from rewarding agile thinking, flexibility, and the courage to try out new things. Adopt a golden triangle approach to working with external providers with your business experts setting the direction, your providers/agencies executing plans, and your measurement and tech partner measuring, running simulations for scenarios and helping you optimise your response and action plans.

Adopting these guidelines and leaning-in to scenario planning for 2025 will ensure success no longer hinges on a crystal ball.

Maren Seitz is a senior director at Analytic Partners