How Rent the Runway is Reducing Facebook Acquisition Costs While Increasing Growth and New Customer LTVSep 1, 2016 - by Elizabeth Trombino
In a recent Sailthru customer survey of more than 200 retail marketers, we found that 59% of marketers are currently using paid social channels for acquisition, with 85% of marketers specifically using Facebook for acquisition over the last 12 months.
The need to increase customer growth and increase revenue while decreasing acquisition spend is top of mind for any retailer, but the path can be daunting. In a multi-week program, we worked with both retailers and publishers to optimize and drive new customer acquisition with Sailthru’s predictive analytics capability, Prediction Manager, and Facebook’s lookalike modeling tool.
With these combined tools, marketers are able to predict future customer behaviors, such as likelihood to purchase, open email and predicted order value. Once the highest value customers are identified, this list is exported to Facebook via a one-click integration. Building new target audiences using Facebook lookalike audiences and Sailthru’s Prediction Manager enables marketers to acquire new customers predicted to deliver more revenue at a lower cost.
Rent the Runway’s New Muse: Facebook Acquisition + Sailthru
After seeing successful initial results with the program, Rent the Runway tripled their investment in the program and said the results exceeded expectations and expanded their audience reach. Rent the Runway is not only a successful startup and Internet Retailer Top 500 retailer, but has forever disrupted the fashion industry by making luxury fashion accessible to millions of online shoppers.
To deliver their brand to consumers who weren’t yet Rent the Runway customers, the company first used Facebook’s lookalike modeling based on customers who had purchased in the last 180 days. When the company decided to optimize with Sailthru’s Prediction Manager, they were able to test a new lookalike audience based on a customer’s likelihood to purchase in 30 days vs. the past 180-day purchase model.
The results were significant when switching to the predictive audience model:
- 40% reduction in mobile subscriber acquisition cost
- 28% reduction in desktop subscriber acquisition cost
- 20% higher expected one-year lifetime value for desktop
Josh Gray, their Director of Acquisition Marketing, said:
“We have achieved great success with Sailthru’s Prediction Manager. We’re looking forward to continuing to test the use of Prediction Manager and to finding new ways to leverage the vast troves of customer data that Sailthru enables us to collect, manage and measure.”
To learn more about Rent the Runway’s success – read the full success story now!