Born to Sparkle – Lessons from CARAT* London’s e-commerce success
In 2017, fine fashion jewellery brand CARAT* London identified e-commerce sales via its website as an opportunity to accelerate growth in its key markets; the United Kingdom and Hong Kong. To achieve ambitious growth objectives in this highly competitive space, CARAT* London partnered with strategic and integrated Digital Agency Lion & Lion.
The partnership paid off well for CARAT* London with e-commerce sales reaching record levels during the December 2017 and January 2018 holiday period. E-commerce sales increased by over 150% compared to the same period in the previous year and boosting an impressive average return on investment of 132% between June 2017 and January 2018.
Three cornerstones of CARAT* London’s e-commerce success
It is the million dollar question – how can you increase sales for your e-commerce business? In order to succeed in e-commerce, you will need to consider these three cornerstones:
- Setting the right objectives – are your KPIs meaningful to your e-commerce business? And do they link back to driving real business results?
- Integration – is your e-commerce strategy addressing all stages of the consumer funnel?
- Finding the right partner – are you joining forces with an experienced partner that speaks business like you do?
1. Setting meaningful and measurable digital marketing objectives
Many brands are lost in the jungle of digital marketing KPIs. Especially when it comes to so-called ‘top-of-the-funnel campaigns’, many brands struggle to quantify success criteria. Objectives such as ‘awareness’ or ‘engagement’ can be ambiguous and, in the worst case, be entirely meaningless. After all, not everyone who likes your Facebook posts may actually have any intention of ever buying your products. To overcome this challenge, CARAT* London defined platform-specific metrics in collaboration with the Lion & Lion team. For ‘bottom-of-the-funnel’ channels, such as paid search, Cost per Acquisition (CPA) and Return on Ad Spend (ROAS) were obvious choices. For other campaign types, such as influencer marketing, more bespoke metrics were defined. To better quantify the success of an influencer campaign two objectives were set:
- An influencer’s Average Engagement Rate for the campaign vs. an influencer’s Average Engagement Rate in general
- Change in branded search volume on Google search
The first objective is instantaneous and reflects directly on the fit of an influencer and a brand, as well as how well an influencer’s audience responds to the content posted during a campaign.
It is difficult to measure and gauge the exact impact influencers have had during key campaign periods, although measuring a change in branded search volume is a less direct method of measurement, it is a more long-term measure of success as it shows an increase in search and organic brand intent. Moreover, branded search volume is affected by many factors, such as seasonal patterns, discounts, other marketing efforts, etc., making it a meaningful measure that provides an understanding as to whether or not a (sizeable) influencer campaign has actually performed. Namely, it is fair to assume that awareness levels grow due to the activities of influencers which causes more people to start searching for a brand on Google.
CARAT* London’s 2017 Christmas influencer campaign outperformed on both objectives on average, and the engagement rate of influencers used during the campaign was significantly above the influencers’ typical engagement rate. Furthermore, the influencer campaign helped increase Hong Kong’s average branded search volume for CARAT* London by 98% with a 189% increase in website sessions (June 2017 vs. January 2018).
|Figure 2. The Average Monthly Searches for Branded Keywords CARAT* London|
|The average monthly search for branded keywords in Hong Kong (‘Carat’, ‘Carat London’; excluding ‘agency’) from 1 June 2017 until 31 January 2018. Source: Google 2018.|
2. Integration: Aligning Creative and Digital Media Strategies
To a performance marketer, running a conversion focused campaign with visuals that do not show any products is the stuff nightmares are made of. Although such extremes can usually be avoided, a disconnection between creative and media strategy is one of the most common problems that digital marketers face. The CARAT* London team circumvents such issues by including Lion & Lion in critical creative review sessions, thereby allowing Lion & Lion to leverage its in-house creative team and to provide expert guidance that ensures maximum effectiveness of CARAT* London’s creative assets. As an example, to increase awareness of the brand, Facebook canvas ads were utilised to introduce the different styles of CARAT* London’s collections to a broad audience.
As a next step, to further prompt Facebook users who had engaged with these ads, they were retargeted with a Facebook lead ad that included a standard incentive CARAT* London offer. This tactic reaped two impactful benefits for CARAT* London’s e-commerce business; It generated a wave in e-commerce sales and simultaneously captured additional invaluable user information, such as product preferences and email addresses. This allowed CARAT* London to further scale its e-commerce operations by building Facebook ‘Lookalike’ audiences and improve customer lifetime value via email marketing, which is an integral component of the campaigns.
3. Finding the right partner for your e-commerce business
Running an e-commerce business in a highly competitive space, like the jewellery industry, is a complex task. After initial struggles, CARAT* London partnered with Lion & Lion in 2017.
Scott Thompson, founder and CEO of CARAT* London, explains why picking Lion & Lion was the right choice; “I was looking for an agency to run all our campaigns on Google and Facebook while delivering business results and to holistically steer the growth of our e-commerce operation. Our partnership with Lion & Lion is based on mutual trust, and besides running all our ads on Google and Facebook, the Lion & Lion team has provided great insight on how we can optimise creative (assets), email marketing and our website. All this has put us on an incredible growth trajectory.”
In a recent article in Campaign Asia Stephan Loerke, the Chief executive officer of the World Federation of Advertisers (WFA) talked about how “Transparency, brand safety, viewability and ad fraud are the top concerns of marketers when it comes to digital advertising”. Although there is a reason to believe that digital ads and agencies have been through their most trying times, there is still a long way to go for the industry as a whole. For brands, it’s important to pick partners who are fully transparent with pricing, activities and results etc., and who ensure ads are served in environments that are right for the brand, and effectively seen by people. If you get that right, your ads will be strategically better placed with significantly reduced media wastage, which will lead to more sales.
Lion & Lion Client Director Supriya Jain adds; “One of the key differentiators of Lion & Lion is that we do not link our fees to how much media a client spends. We categorically reject the typical percentage-based remuneration as it creates a situation where an agency is incentivised to spend as much money as possible. Through our data-driven strategy, we were able to scale CARAT* London’s e-commerce sales by identifying growth opportunities, but also by reducing media budget wastage. Take Google Paid Search, for instance, we increased media efficiency by 47% in between June 2017 and January 2018 by scaling up profitable campaigns while spending less on areas that didn’t deliver results.”
|Figure 3. Media Efficiency for Google Paid Search|
|Media efficiency of Google Paid Search where e-commerce Revenue was 9.6x higher than Media Spend in January 2018 (improvement of 47% versus 6.5x in June 2017). Media Efficiency is calculated by dividing e-commerce Revenue by Media Spend.|
Key takeaways for your e-commerce business
The main lessons from CARAT* London’s e-commerce success is that alignment trumps all:
- Your agency’s fee structure needs to be linked to your business performance, not to how much money is spent on ads
- Media objectives need to be aligned with business goals (not clicks, traffic, engagement or other input metrics)
- Media strategy and creative direction need to be aligned
If you are interested in growing your e-commerce business? Drop us a message or give us a call.