Bids, Budgets & Black Ops III: The Power of Product-level Behavioural Insights
Tesco was founded in 1919 by Jack Cohen as a group of market stalls. Originally a UK grocery retailer, since the early 1990s Tesco has diversified geographically into areas such as the retailing of clothing, electronics, furniture and toys.
When Tesco Direct first started working with Periscopix in June 2015, the Entertainment account (covering gaming, DVDs, books & music) had a bloated campaign structure, outdated product coverage and non-specific ad copy. The account was also pacing ahead of schedule for the year, so we needed to pull spend back quickly to save budget for Christmas.
With these issues in mind, Periscopix were tasked with three objectives for the account:
• Ensure the account came in on budget at the end of the year. • Minimise the impact of the spend cutback on revenue as much as possible. • Reduce the cost of sale (COS) by 40%.
We began by identifying a core set of products within the account that performed well and had the best profit margins. We reduced the account coverage to just these products and carried out a full audit in line with our best practices: ad copy was made more relevant, more granular bid management rules were deployed, and the shopping campaigns were restructured to give us more control over which products matched to which search queries.
The Power of Product-Level Behavioural Insights
From here, we looked at ways to refine our strategy, ensuring we were ready to maximise revenue in the run up to Christmas. We decided to focus on upcoming launches of big product releases, as we knew that there’d be significant demand for these. Focussing closely on one product, we set about creating a granular campaign with specific ads tailored to the different editions of FIFA 16, ensuring that our ads stood out amongst the competition:
This method also allowed us to gain valuable insights into the life-cycle of each product, including:
When we should be bidding more aggressively, and when we should be pulling back our bidding in order to achieve maximum ROI.
How far out from product launches we should be launching campaigns to take advantage of pre-orders.
The length of time after launches that products benefited from the “halo effect” and could still drive significant volumes.
Off the back of these results and insights, we began shifting the account strategy to an approach that put products with upcoming launches front and centre, running granular, time-limited campaigns. Further successful campaigns allowed us to refine this strategy even further and a data-led model for budget allocation, campaign length, and bid management began to emerge.
In particular, we carved out a specific roadmap for the actual launch week itself, which allowed us to forecast demand vs. traffic by day. This allowed us to proactively bid in-line with demand day-by-day, increasing the efficiency of our campaigns, and reducing wasted spend.
Overall, by taking the time to learn about the specific traits of PPC for entertainment products, and using the data within the account to guide the strategy, we were able to completely transform the way the account was approached, and the results speak for themselves:
Comparing October – December 2015 to the same period in 2014, revenue has increased by 150%, despite spend falling by almost 20%.
COD has been significantly under the target since October 2015 – decreasing by 82% since takeover.
By late December 2015, the account was back on budget and spending at the appropriate rate!
Quote from the client
“Periscopix transformed our Entertainment account. Their data driven approach and commitment to learning the specifics of this vast area enabled continual strategy refinement and optimisation. The results saw reduced spend and maximum revenue on the account that continues to perform.”
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