Having mastered search, social, and app-based channels, marketing teams at Privalia were curious: could they grow product conversions even further by opening additional display-focused channels? Display advertising was generally known to increase product awareness and Google’s dynamic inventory was undergoing both placement optimization and expansion…could this channel be another successful tactic in Privalia’s marketing playbook?
But how much budget should be allocated to this channel?
And how effective would display advertising be in growing bottom-line revenue?
“We win when we create better shopping experiences. We win when we bring the most relevant products to our customers. And we win when we find new marketing approaches to bring our audience closer. The challenge is to discover which one of the new approaches work better in order to achieve insights through testing.” – Marina Casas, Advertising Specialist, Privalia
Privalia’s marketing teams have always been strongly data-driven in their strategic planning. Using industry models of projected market impacts from display ads, they projected an initial €100K to start growing these new display channels over upcoming quarters.
After learning about the newly-released Impact Navigator solution from Kenshoo, Privalia was curious about running a pre-holiday marketing experiment to directly validate the value of this additional display budget. Impact Navigator is a SaaS solution for analyzing the brand behavior of audiences, creating optimal testing plans using geographically distinct test and control groups, and monitoring the behavior of these groups to determine the actual incremental revenue impact of specific marketing tactics.
Privalia’s teams input their strategic goals and audience metrics into Impact Navigator, which then calculated an optimal 6-week plan that would complete in time to provide insight for optimizing holiday marketing spend, while also ensuring data volumes would provide statistical significance for the reported results. Privalia executed this test plan starting in August 2019, and completed their test in September.
The results of the test were eye-opening: instead of raising revenues, the new display channels resulted in no significant brand lift when measured as part of the actual market mix in place.
Further monitoring of the test and control groups after the experiment showed nothing out of the ordinary with regard to expected regional purchase behavior, and the cost of executing the test was exactly predicted by Impact Navigator’s test plan. Both of these factors supported the conclusion that the test has executed correctly, with valid results that were not part of a one-off seasonal anomaly. The conclusion of the test was unavoidable.
Now reallocating their display budget to better support more effective channels, Privalia’s marketing teams have more confidence in their audience strategies. And going forward, they have the tools and expertise to use marketing experiments to explore various new opportunities while knowing that data-driven decisions will always keep them aligned with their very fashionable and fast-moving audience.
Privalia is a leading ecommerce outlet focused on fashion, footwear and home decor. Founded in 2006 in Barcelona, Privalia engages over 34 million registered users around the world with daily flash sales and singular product offerings unique to their platform.
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