Nederlands 
English The media saturation curve
No channel delivers endlessly more with more budget. The saturation curve shows where the additional euro starts to weaken, and therefore where you are better off shifting budget elsewhere.
The saturation curve describes the relationship between media spend and the revenue contribution of a channel, where each additional euro eventually yields less additional revenue. This effect is called diminishing returns.
What a saturation curve looks like
If you plot a channel's spend on the horizontal axis and its revenue contribution on the vertical axis, you do not get a straight line but a bending curve. In the early stages, each euro delivers a lot. As you spend more, the curve flattens.
The reason is practical. You first reach the most receptive audience. After that you pay for repeated reach with the same people, or for less relevant audiences. The return per euro declines.
Each channel has its own curve. One channel saturates quickly, another keeps delivering returns for longer. That is where all the gain from smart budget allocation lies.
What the saturation curve tells you
Knowing the curves of your channels lets you allocate budget by return rather than by habit.
The optimal spend level
The curve shows where a channel still delivers a return and where the additional euro is better spent elsewhere.
Untapped capacity
Channels still in the steep part of the curve can absorb more budget without a loss of return.
Overspending
A channel deep in the flattening zone wastes budget that would deliver more elsewhere.
The basis for reallocation
By comparing curves you shift budget from saturated to productive channels.
How to determine the curve reliably
A saturation curve is estimated from historical variation in spend and revenue. The more your spend has varied in the past, the more precisely the model can establish the shape of the curve.
Marketing Mix Modeling estimates these curves per channel and uses them directly for budget optimisation. The curve is therefore not a theory, but the calculation basis for your allocation.
Frequently asked questions
What are diminishing returns in marketing?
Diminishing returns means that each additional euro of media budget eventually yields less additional revenue. The saturation curve makes this effect visible per channel.
Why does each channel have its own saturation curve?
Because channels differ in reach, audience and frequency build-up. A channel with a large untapped reach saturates more slowly than one that is already reaching its full audience.
How do I use the saturation curve for budget allocation?
You shift budget from channels in the flattening part of their curve to channels still in the steep part. This increases total return without the budget growing.
Do I need a lot of data to estimate the curve?
You mainly need variation. If your spend has been constant for years, a model will struggle to establish the curve. Periods of scaling up and down help sharpen the estimate.
Allocate budget on the curve.
Book a demo and see the saturation curve of your own channels in Datafy.