- As direct-to-consumer brands grow, they’re trying to get smarter about how they spend their ad dollars.
- A startup called Measured says it’s helping brands like Casper and Peloton cut waste from their spending.
- Measured does this with incrementality tracking, a tactic that uses A/B testing to measure advertising’s effectiveness.
- Incrementality is growing more commonplace with bigger marketers like Airbnb and eBay.
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As direct-to-consumer brands grow, they are only looking to advertise beyond social platforms like Instagram and cut waste from their ad spending.
Read More: Direct-to-consumer brands that built their businesses without traditional advertising are now embracing it in key ways to fuel growth
One startup that’s helping them solve this problem is analytics company Measured, which uses a tactic called incrementality tracking. This uses A/B testing to measure the effectiveness of ad campaigns across channels.
Measured says it helps brands figure out if their ads dollars are actually working
The company launched in May after testing its technology with a few companies in 2017 and now works with 18 brand including Casper, Peloton, FabFitFun, AB InBev, Faherty, and Soft Surroundings.
One client, clothing brand Johnny Was, wanted to acquire new customers and grow its ecommerce business. It was able to see which channels were most profitable and double its online sales in 18 months, according a case study from Measured.
Another client, Soft Surroundings, learned that it was spending too much on retargeting during the holiday season. It cut that spend by 85%, and saw no impact to the bottom line, saving $40,000 from its marketing budget, said marketing director Gail Buffington.
Incrementality is a growing focus for performance-driven marketers
Marketers also use media-mix modeling and multi-touch attribution to evaluate their ad spending. But incrementality tracking is growing more common among marketers, including big ones likeAirbnb and eBay.
Incrementality can come in when brands want to know which ads drove immediate action, based on signals like the final click that came before a purchase. For example, someone getting a print catalog or email may play a role in their decision to buy in addition to a Facebook ad. This is one reason Soft Surroundings wanted to move away from multi-touch attribution, said Buffington.
Read More: Dick’s Sporting Goods used Facebook to automatically serve different ads to different people — driving $10 million in incremental sales during the holiday season
A/B testing is hardly new, though, andNielsen, Quantcast and Adroll all provide media-mix modeling and multi-touch attribution. Platforms including Facebook and Pinterest do incrementality studies to show how their data can drive sales for advertisers, too.
But unlike other vendors, which typically run incrementality tests for a given period of time, Measured co-founder and CEO Trevor Testwuide said he thinks his company has an edge because its testing is always on and continually reporting results.
“We are solving the problem of cross-channel attribution — what is actually moving the needle for their businesses,” he said.
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