Recommendations based on Roivenue's multi-touch attribution analysis saved Econea 15% of marketing budget. Because there was no impact on revenue, the overall marketing ROI grew by 40%.

Definition of metrics

There are many metrics to evaluate the effectiveness of marketing campaigns. This case study focuses on ROMI and mROMI so let's quickly recap how Roivenue calculates them. 

ROMI = Return On Marketing Investment 

ROMI evaluates how marketing investment impacts revenue. It doesn't take into account the cost of goods sold and its beauty lies in its simplicity. Simply put, negative ROMI means the campaign is losing money.

The formula: (Revenue - Marketing investment) / Marketing investment

mROMI = Margin Return On Marketing Investment 

mROMI takes into account not only marketing investment but also the cost of goods sold. This is a more comprehensive metric than ROMI; it enables marketers to measure the profit of campaigns. 

The formula: (Revenue - Marketing investment - Cost of goods) / Marketing investment

The client

Econea is an e-commerce brand from the Czech Republic selling sustainable, eco-friendly products for daily use. Econea not only caters to the growing number of environmentally conscious consumers, but also leads the way in digital transformation. This visionary e-shop of young founders has already become a beloved brand and a leader in its category.

Background

Climbing it's way up through marketing maturity, the time has come for Econea to start driving growth systematically and making decisions based on advanced data. They chose Roivenue as their partner to help with marketing attribution and data integration. Inclusion of internal CRM data was particularly important given the objective to optimize campaigns for overall profit.

Analysis

Our multi touch attribution analysis revealed that Facebook Ads - the biggest channel in terms of overall investment - had a negative ROMI (Return On Marketing Investment) as decided by our Markov First Order attribution model.

Having previously used last-click attribution, Econea marketers were not sure about the real contribution of the channel. They operated off of the assumption that Facebook Ads inspired users to interact with other channels. They thought this  externality would make it’s high spend worthwhile.

Now, there is hard data to show this channel was overinvested.

ROMI comparison of Markov 1st order with last-touch attribution model.

Optimization of Facebook Ads investment

1. Following the analysis, marketing investment in Facebook Ads was reduced in weeks 26-29.

2. As expected, budget cuts only had a very small impact on the overall revenue.

3. Resulting in ROMI turning positive.

The effectiveness of Facebook Ads channel was swiftly increased. Savings amounted to 15% of the overall digital marketing budget while revenue held steady.

Maximizing optimization opportunity

Optimizations didn't stop with Facebook Ads. Having connected Econea's internal order system to Roivenue, we were able to start optimizing the profit of channels (ie. mROMI).

Criteo caught our attention. The data-driven multi touch attribution analysis revealed that Criteo's mROMI was -0,4. In plain English this means that Econea was losing 0,4 EUR for every 1 EUR invested in it.

The comparison of mROMI in Markov 1st order vs. last-touch attribution

Remarketing platforms, such as Criteo, typically stand at the end of the conversion path (a fact confirmed by Roivenue Path Analysis) and are expected to be profitable.

Path analysis of marketing channels

Following the analysis, Econea decreased bidding in the platform and immediately saw an increase in marketing profit of the Criteo channel. 

Consistent marketing profit from Criteo is aquired

Summary

Overall margin Return on Marketing Investment increased from an average of 1,6 to 2,3. Econea's marketing profitability grew by 40%.  

“ I think that cooperation with Roivenu is a huge step forward and we can see that hard work in weekly evaluation of marketing activities and data-driven decisions based on data we can trust is paying-off.”