When R+Co first launched on Amazon their products flew off the shelves. They were operationally healthy and had amazing reviews. But after a while, things began to slow down a bit.
The Tinuiti and R+Co teams had to go back to the drawing board and ask themselves:
- What is it that we’re not doing?
- What should we be folding into our advertising strategy to continue to see this growth on Amazon?
They began to invest more heavily in their branding to take full advantage of the real estate on Amazon where they could show their creativity and brand story.
The Tinuiti team designed and built out R+Co’s Amazon Store. Stores can act as microsites that allow brands to create a customized experience on Amazon.
R+Co made sure that they showed up on both branded and non-branded Amazon search engine result pages (SERPs). They had high brand awareness from selling across other platforms but wanted to make sure they showed up for the relevant searches — whether a shopper included their brand name or not.
With that buttoned-up, R+Co began to layer in a more full-funnel Amazon DSP strategy.
Distribution Channel Management
Amazon does not exist in a vacuum; how you advertise on Amazon impacts every other channel you sell on. But how do you take those other channels into account when planning a full-funnel strategy?
Before, R+Co ran passive, lower-funnel display ads on Amazon. With their new strategy, they planned to run a wider variety of ads both on and off Amazon, targeting different parts of the purchase funnel.
Though R+Co has a traditional distribution model, they have a customer-centric approach across distribution channels. Their focus on Amazon isn’t meant to take away sales from any other channel. Instead, their goal is to access the core Amazon customer. That shopper is someone who is:
- Shopping across categories
- Shopping multiple times per week
- Loyal to Amazon
- Amazon Prime member
Converting these shoppers to lifetime R+Co customers benefits the brand regardless of the channel. Done right, advertising on Amazon brings in additional growth for the overall organization.
When R+Co started, luxury beauty was a brand new category on Amazon. They saw explosive growth of 360% using Ad Console in 2017, and experienced 57% growth in 2018 after launching DSP.
But that wasn’t enough to keep up the momentum going into 2019, where projected growth was just 23%. The next step was to look at how DSP could fuel brand and business growth on Amazon and beyond.
The goal: To drive significant incremental revenue for R+Co on Amazon.
The plan: To keep running lower-funnel retargeting ads while also using full-funnel display to bring in new-to-brand consumers, grow the targeting pool, and, ultimately, increase sales.
Implementing a full-funnel approach lifted the growth from the projected 23% to 53%.
Tinuiti’s DSP Strategy: Crawl, Walk, Run
R+Co wanted to take a mindful approach to layer in a more robust, full-funnel Amazon strategy. They used a “crawl, walk, run” strategy to gradually build up their DSP advertising.
Step 1. They continued lower-funnel retargeting for top products, working with the amazon team to bring these ads over from Ad Console to DSP. This made sure they didn’t start from ground zero.
Next, they began to layer in mid- to upper-funnel advertising using In-Market and Lifestyle segments. In-Market segments use Amazon’s first-party data to identify shoppers who have shown interest in that category, while Lifestyle segments include shoppers who have shown interest over a longer period of time. Amazon has a wealth of consumer data available in DSP with tons of options for Amazon targeted audiences.
Step 2. The goal of this second step was to drive more traffic to the product detail page. Once customers visited the product detail page, R+Co could get in front of those customers later on with retargeting ads.
Step 3. Third, they launched static ads for mid to upper-funnel tactics to drive traffic to the Amazon Store. Driving relevant audiences to the Store lets people learn more about a brand; this touchpoint makes them more likely to become lifetime customers. This was more of a long-term play than the lower funnel tactics that drive traffic directly to a product detail page.
For Prime Day, R+Co offered 30% off their entire catalog. They incorporated than messaging into static ads that led shoppers to the Store. Despite not linking directly to the product detail page, R+Co saw high conversion rates.
With mid, upper, and lower funnel tactics in place, R+Co began to layer in loyalty and retention tactics to nurture current customers. Shoppers on Amazon are more and more brand agnostic, so loyalty and retention help brands like R+Co stand out from the mass market beauty on Amazon.
R+Co leveraged basket building opportunities to boost loyalty and retention. For example, if someone has purchased R+Co shampoo but not a conditioner, they’ll be shown an ad for the conditioner. The ad takes them to the product detail page for the conditioner and ultimately grows the value of that customer.
Here are the results of R+Co’s new DSP strategy and tactics:
- 85% increase in detail page views from mid- and upper-funnel tactics
- 70% increase in units sold with full-funnel implementation. (Upper- and mid-funnel tactics increase the number of opportunities for retargeting, which ultimately increases sales.)
- 48% increase in total sales after full-funnel implementation
- 36% increase in return on ad spend (ROAS) after full-funnel implementation
Tinuiti breaks out reporting based on what part of the funnel those segments and tactics apply to, making it easy for R+Co to see which pieces of their DSP strategy drive results.
As a result of R+Co’s increased advertising on Amazon, they also see more visits to their own website — even though the ads don’t link there. Their Store tells shoppers a brand story, inspiring them to R+Co’s website to learn more about the brand and products.
“We saw strong overall YoY growth for each ASIN we heavily advertise through DSP & Ad Console.”
– Madalyn Kaseeska, Marketplace Channel Analyst for R+Co at Tinuiti
Here are some key takeaways from R+Co’s success with DSP:
- Once your products are retail-ready and dialed into search efforts, consider running display ads
- Prevent brand growth slow-down by running a full-funnel Amazon advertising strategy
- If it’s your ﬁrst time running Amazon DSP, start with a crawl, walk, run strategy
- Set clear KPIs for each display strategy
- Running Amazon search and display in tandem can grow your business signiﬁcantly YoY
- Amazon display can grow brand awareness both on and off Amazon