Seller’s Concern
Ohora, a leading gel nail brand, faced a common challenge in a competitive market: determining if their aggressive ad spend was truly optimal. The company wanted to establish a baseline ad spend that could maintain their current performance while gaining insights into how budget adjustments would impact sales and traffic. These insights would empower Ohora to manage their Total Advertising Cost of Sales (TACoS) more effectively.
Achieving this required analyzing the relationship between ad spend and sales. However, such experiments typically involve significant budget increases or cuts, which can disrupt ad campaigns optimized for existing spend levels. Major budget changes often lead to risks like reduced impressions or lost sales, necessitating constant adjustments to keywords and bids. This level of manual intervention can be resource-intensive and time-consuming.
Finding the Optimal Ad Budget with LG Optapex
LG Optapex is a solution designed to simplify this process. Powered by advanced AI prediction models and mathematical algorithms, LG Optapex calculates the optimal budget and bid strategy for any given total budget. The system’s adaptability enables it to react to changes on an hourly basis, ensuring critical campaigns and keywords remain live throughout the day.
When Ohora took a bold approach by reducing their total ad budget by over 90%, LG Optapex responded with a two-step approach:
LG Optapex Solution
1) Bid Adjustment
The system reduced the overall bid range to prevent campaigns from shutting down prematurely due to budget constraints.
2) Keyword Optimization
Optapex polarized the bid range, prioritizing efficient keywords over less effective ones to maximize the impact of the limited budget.
The results were remarkable. Despite the drastic budget cut, Ohora experienced only a 10% drop in total sales. Simultaneously, they improved key efficiency metrics: ACOS decreased by 6.6%, while impressions per cost increased by 28.4%. By maintaining efficiency while significantly reducing ad spend, Ohora quickly determined that their optimal total budget could be far lower than previously thought.
.png&blockId=2005e410-2a2b-48ab-9da5-24944a599e3d)
Results
With LG Optapex, Ohora gained actionable insights and achieved a level of ad spend efficiency that was both cost-effective and sustainable, reinforcing their competitive edge in the market.
.png&blockId=b7c5384d-66b8-4ae8-8854-720f9bb40fc5)
ⓒ All page content is property of LG Optapex. The source must be indicated when quoting and any further copying, unauthorized reproduction or redistribution is prohibited.