RTB - super-profitable channel or another dust in the eye? How to properly analyze retargeting channel
I was inspired to write this article by the desire to share my experience and get good advice from more experienced fellow analysts.
Briefly about myself: I’m nik252 , for a short 3 years I have been creating, administering and analyzing e-commerce websites with my partner. In August 2015, we received a fairly large project in the form of a website for the sale of women's clothing, let's call it Project “C”. On average, he has 100k uniques per month, but is subject to strong seasonal fluctuations due to the specifics of the product.
For greater interest, I will provide screenshots of all well-known analytics tools.
Project Channel C Structure for November 2015
The main task for me and my colleague, I will call him Mr. "V", was, no matter how corny, an increase in sales.
To begin with, we set about increasing the influx of new users by placing all kinds of advertising, the basis of which was our “favorite” direct. But the profitability of this kind of channel was at best 8-12%, which did not tire of us, since we believed that we could invest more effectively.
After analyzing the sales funnel, we came to the conclusion that we are quite good at bringing new customers, their share was ~ 65-70%, but we have difficulties keeping them. At that time, only Yandex and Google retargeting worked. Hand on heart, they were tuned in through ___, and in general their effectiveness and flexibility caused me great doubts.
At the next "brainstorming", it was decided to work with the "retention bulb", for which RTB was chosen. We started looking for partners for work, Mr. “V” preferred organic search, and in the meantime, I began to look at competitors' URLs in search of useful UTM tags.
After a short search, we still found a large company operating around the world - ___teo (who knows, he will understand). Having settled all the troubles with the settings of the trackers and documents, we set the price for the click and began to wait until the data for analysis was collected. Neither I nor “V” had high hopes for this tool, however, the result pleasantly surprised us.
Data obtained in the first month:
I will not disclose commercial information, but the return on investment according to the results of the analysis of shipments was 30%, which could not but rejoice us.
After 2 months, we already had this result:
And profitability is about 150%.
As a suspicious person, the figures could not help but make me think: something is wrong here. Either we are such good fellows, or we are not able to count.
Here the main idea of my article looms: How to analyze RTB?
If we look at the standard Paid Search reports in GA, then inside of each of us a little financier rejoices.
But, the whole “raspberry” is spoiled by one concept: “hold time”, and in our case it is 30 days. For those who are not quite “on the topic”, I’ll explain: it doesn’t matter at what time the customer made a purchase on the site, if within 30 days he clicked on an RTB banner, the purchase will go to this channel, in other words, if the client is on the way to conversion went through the banner, this lead will go to the retargeting channel.
In order to get more objective, in my opinion, data, I made a selection in the “main conversion paths” section, filtering out only those transactions that were completed immediately after interacting with the RTB banner. Result: 60 orders out of 250 fell into this sample, which, as before, gave us a margin margin of 15-20%, but it did not go in any way compared with the figure of 150%.
All these calculations make us ask ourselves a philosophical question: “Would a client make a transaction if this channel was not in its path to conversion or not?”
In another way it can be formulated as follows: “How justified are investments in auxiliary interaction?”
Question to the audience: How do you analyze RTB? And what are your results using this tool? In your opinion, is this channel super profitable or is it another global divorce?
Waiting for your comments and thank you for your attention!