Cranking up spend without knowing the road ahead
Ensuring revenue goals amidst pandemic uncertainty
As their digital media partner of record, every year PEARL iZUMi looks to IMM to help reach revenue goals through both retention and acquisition media strategies. As the pandemic reared its ugly head, PEARL iZUMi’s dot com was at the ready to take advantage of the major pendulum swing towards online shopping. What wasn’t known at the time, was just how much cycling would surge in demand.
Do we “wait and see” or “stay the course?”
Every brand and business had to pivot in some way during this crisis. Yet which road to take was the question, especially because we didn’t know what we didn’t know. A lot of brands in a variety of industries decided to pump the brakes on ad spend because physical retail locations were closing their doors left and right. What we did know was that if PEARL iZUMi reduced ad spend at this moment in time, their business would suffer.
Our Client Experience team quickly strategized around the current climate and identified several opportunities to jump on. Specifically, the realization that online shopping would surge, that most advertisers were pulling out of the advertising space causing media costs to plunge and that people were adopting new hobbies while sheltering at home, especially in the fitness space. Together with the PEARL iZUMi team, we determined that the opportunity cost of sitting on the sidelines was much too high and aligned to increase media budgets beginning in April of 2020.
With the goal of capturing as many new cyclists as we could, our acquisition-focused media strategy leaned into promotional periods when consumers are more likely to try and buy. This resulted in weighting media budgets during promo periods and advertising sales across all channels, including Connected TV (CTV). We also focused on prospecting, meaning we cranked up non-branded search, introduced new cyclist audiences and optimized our lookalike modeling to ensure that the new entrants were being treated as a separate group from existing cycling loyalists. In parallel our always-on awareness strategy, grounded mostly in CTV and online video, ensured PEARL iZUMi stayed top of mind all year long.
Leveraging CausedCommerce, our powerful analytics platform, we could measure not just how much revenue was driven by paid media but also how much of that revenue was truly incremental. This allows us to optimize plans based on incremental sales to reach consumers beyond those already planning to buy. Alongside maximizing the return on ad spend, we analyzed purchase patterns to determine which products drive the strongest sales among the new cyclist audience and rotated those ads into the mix accordingly.
Drafting off of the media strategy, we approached creative based on what we know about beginner riders and first time gear-buyers. First party data tells us that beginner cyclists tend to need two things the most: shoes and bike shorts. We created ads featuring these products to lure newcomers to the brand, while retargeting site visitors with specific product ads based on browsing history to increase conversion rate.
The full-throttle push paid off
New customer acquisition boomed as COVID-19 drove a ton of newbies into the world of cycling. Net new customers to the brand drove 95% of revenue in 2020. And our decision to increase media spend by 50% YoY paid off as the unprecedented interest in cycling helped prompt a 241% increase in incremental revenue.