TAKING OVER EUROPE & BREAKING THE ROAS PARADIGM WITH PHYBONACCY IN 8 COUNTRIES

SUMMARY

ROAS is suboptimal for ecommerce businesses because it doesn’t consider returns from customers or the great variability of margins. For Spectrum, an Italian clothing ecommerce, we built a system to import the sales marginality from their CRM and then match it with the gclid from the Google Ads campaigns to optimise for offline conversions. We started implementing this system in Italy, being SPECTRUM’s core country of sale, but then exploited it to support their international growth.

In 2019, we began our expansion to: Austria, Belgium, France, Germany, Ireland, Netherlands, Portugal and Spain. In 2022 we implemented our new system for offline conversions.

In the 6 months following the implementation of the new system, the investment on Shopping/then-upgraded-to-Pmax campaigns increased by +128% and the average margin per transaction doubled.

We successfully expanded on an international scale while further demonstrating our new conversion setup ability in helping smart bidding prioritising margin over revenue. These results show that feeding the algorithms with more accurate data is the best way to move with machine learning and foster profitable expansion and international growth.

THE CHALLENGE:

Foster growth on an international scale thanks to more profitable conversions and efficiently allocate incremental budget on Performance Max campaigns, optimised for MOAS (Margin On Ad Spend).

THE SOLUTION:

Phybonaccy, an internally built tool connecting customer first party data (CRM and on-site pixels) to advertising platforms to feed the algorithms with more sophisticated data.

We imported sales marginality from Spectrum’s CRM into Google Ads, matching the gclids coming from the ad clicks and optimised Performance Max campaigns accordingly, with a smart bidding strategy that sustained our client’s international growth.

Graph 1: YoY Investment comparison