MENGUIN PART 1: FACEBOOK
OVERVIEW & COMPANY HISTORY
Menguin is the premier online shop to rent tuxedos and suits. By digitizing the rental experience they’ve helped thousands of brides and grooms create customized looks, making sure their groomsmen look great on the big day. However, their long sales cycle and multiple touchpoints with customers creates unique challenges when it comes to measuring the effectiveness of their customer acquisition strategy.
Menguin enlisted the digital experts at Social Fulcrum with the goal of increasing brand awareness through social advertising at an effective Cost of Customer Acquisition (COCA). They believed Pinterest ads had untapped potential to drive customers, and while they had experimented on Facebook with moderate success they wanted to further explore how Social Fulcrum could leverage this platform.
THE MENGUIN CUSTOMER JOURNEY & UNIQUE CHALLENGES
Before we delve into specifics of the campaigns, let’s take a closer look at the typical journey a user takes when they arrive on site. While Menguin offers tux and suit rentals on an individual and group basis for any type of event, for the purposes of this case study, we’ll outline the journey of a groom as he styles tuxes for his six groomsmen. Once the groom arrives on site, learns about Menguin, and decides to begin the rental process, the steps are as follows:
- The groom creates an account.
- He then builds a customized style.
- The groom then creates an event and invites groomsmen to join and order the look.
- Groomsmen accepts invite via email.
- Groomsmen creates an account and enters his measurements.
- Groomsmen checkout and the tux is sent 10-12 days before the wedding.
- The groomsmen look dashing in their tuxes and return by slapping the pre-paid shipping label on the box and dropping it at their local UPS.
The first step of account creation is good indicator of user interest, but it’s not until step six that a user converts to become to a paying customer which can occur months after the groom’s first visit to Menguin’s site. It’s important to note that on average one account creation leads to an average of six checkouts (one per each groomsman). The unique conditions of 1.) extended length of time between initial account creation and paying customer and 2.) one account creation leading to six paying customers presents a critical challenge when it comes to building an attribution model which accurately measures COCA. It requires sophisticated attribution tracking, which cannot be built using the Facebook Pixel (as it has a 28 day maximum attribution window), to be implemented to gauge the effectiveness of their ad spend. Our data-centric software combined with the depth of Facebook advertising expertise allows us to tackle these challenges.
Additionally, since the bride is often a key decision maker when it come to wedding planning, gender plays an interesting role in Menguin’s customer acquisition efforts. It’s not unusual for the bride to discover Menguin and create an account with her personal email, but grooms and groomsmen account for over 90% of checkouts. Thus, it’s crucial for attribution that the bride and groom are linked to identify how the resulting customer was acquired.
HISTORY WITH FACEBOOK
Menguin has used Facebook ads in the past primarily by engaging users with compelling content from their blog and retargeting users who clicked those ads. While they’ve seen some success, they had difficulty properly measuring COCA and needed to determine which user action they should optimize for to deliver the most cost efficient results. Menguin enlisted Social Fulcrum’s social advertising expertise to manage and solve these key challenges.
SOLUTION & RESULTS
Menguin’s ultimate goal was to have more accounts created as they have a solid conversion rate from account creation to paying customers. However, they were uncertain if advertising for leads (Menguin defines a lead as a user where they’ve captured name, email, spouses email, and wedding date) or account creation would be more cost effective and decided to start by testing lead ads to answer that question. To begin, we started with our standard baseline of testing image, headlines, and footers to optimize for click through rate (CTR). The test was split by gender to determine which creative combinations worked for groom verses brides. We found that an image featuring the groom and groomsmen performed better for a male audience while a creative combination featuring a kid centric image resonated more with females. These initial rounds of testing determined the winning creative while simultaneously decreasing the cost of a lead by 50%.
With creative determined we turned our focus to test a huge array of audiences. When each audience can be a combination of interests, behaviors, custom audiences, and demographic parameters, the number of potential audience targeting segments can be overwhelming. Our software automates the process of testing a wide variety of variable combinations allowing us to quickly test and identify the most cost efficient audience segments. We discovered that for women a lookalike audience built off of a Menguin lead capture landing page with an overlay of the life event “engaged” garnered the best return on ad spend (ROAS). For men, lookalike audiences based on site activity with the “engaged” overlay were our top performing audiences.
Identifying these cost efficient audiences prepares for audience saturation–a common challenge encountered in paid advertising where costs increases as you increase spend within a fixed audience. To maintain effective results, it’s critical to prepare for this effect by diversifying your “audience portfolio” to identify the top performing audiences before scaling daily spend. As we start to ramp up spend, our software continues to test different variable combinations and automates budget management, allocating spend to top performing audiences which see realtime variations based on market conditions. “In Menguin’s case, we essentially built a $2K per day campaign at $500 per day, and a $10K per day campaign at $2K per day” said Sam Wheatley, our Director of Ad Operations. Put simpler, through automated audience and budget management, we are able test a high quantity of audiences at a low cost. This strategy narrows in on audiences that deliver results before scaling spend and allows for scale to occur while maintaining cost efficiency.
Recall that Menguin’s goal was to garner more accounts creations, but decided to start the campaign collecting leads as an introduction to the Menguin brand. The assumption was that users would continue on the customer journey by creating an account to begin the tux rental process. Taking the action of creating an account is a sound indicator of user interest, making it a pretty good proxy for checkout conversions. Historically, Menguin had seen a solid conversion rate from $/create account to checkout (largely from PPC) and assumed that rate would apply to social advertising. Starting the funnel at the lead level, we saw high conversion rates (10-15%), but high $/create account. The campaign was not viable with these high costs per $/create account, and we decided to bring create account to the forefront of the funnel by sending users directly to the registration page. This decision to switch from optimizing for leads to optimizing for create account allowed us to focus on driving down the $/create account.
After roughly 60 days of testing we had collected enough data to begin to measure how account creations convert to user checkouts– this “down-funnel” data allowed us to dig in and take a closer look at how additional variables affected efficiency. For example, we split campaigns by mobile device type Android vs. iOS because we’ve learned how differently the two device funnels convert. Further analysis yielded these key learnings:
- Female users comprise the most cost-effective audiences in terms of $/account creation on both iOS and Android.
- Android users represent cheaper $/account creation, but yielded less qualified users than iOS as they result in fewer customers.
- Roughly the same percent of men and women appear to create events, but beyond that step, men account for the majority of further activity leading to checkouts.
Given these findings, we shifted the majority of spend to men using iOS devices, thus eliminating wasted budget and focusing spend on users that result in paying customers.
HIGH LEVEL RESULTS:
- Determined that optimizing for accounts created was more cost efficient than optimizing for leads.
- 11,000 new accounts created within 5 months.
- 75% decrease in cost per create event over 3 months
- Decreased cost per create account by 85% over 5 months