MandM Direct believed that understanding customer lifetime value would enable the company to make informed data-driven decisions around promoting efficiency in ad spend, which would ultimately improve overall revenue metrics for the organisation.
To test this, MandM Direct partnered with Google to run a Predictive Analytics project which aimed to generate a score for each customer based on their expected lifetime value.
By leveraging the integration between Analytics 360 and BigQuery, MandM Direct were able to run a lifetime value model which considered the past purchases of customers across key dimensions: frequency and monetary value (RFM approach). A lifetime value score was generated for each customer, predicting their likelihood to convert.
As a way to action this new insight, new audience lists were created in Analytics 360, grouping users by their predictive lifetime value score at a user level dimension.
Taking advantage of the native integration between Analytics 360 and Adwords, several audience-based campaigns were created and deployed using a customised bidding strategy (using Search Ads 360) based on the predicted lifetime value scores across the groups.
MandM Direct have already reported positive results. The new CRM-augmented display campaigns have generated a whopping 40% increase in revenue. Furthermore, in Search, it has seen a significant decrease in CPA (-33%) and 37% decrease in ERS, when compared to other audiences.
Following on from this very promising start, MandM Direct would like to scale the project to other markets starting first with Ireland and Germany, and grow the overall project scope to include a strategy adopting Similar Audiences to help extend reach and acquire high-value lookalikes.