Macy’s Inc. derives only 1.3% of its site traffic from social networks, according to Internet Retailer’s forthcoming Social Media 500 database. Even so, social media plays a crucial role in the multichannel retailers’ digital marketing mix, says Serena Potter, the retailer’s group vice president, digital marketing strategy.
A large chunk of the retailer’s Facebook and Instagram ads are direct response ads. Those ads seek to drive an immediate action, such as a click to a product page or an app download. Macy’s can measure those ads in a number of ways, including by simply looking at the last click a consumer made to arrive at the retailer’s site.
But Macy’s also runs a number of ads that seek to highlight its brand and the products it sells without encouraging the consumer to take an action. And Macy’s is increasingly interested in figuring out how to better gauge the effectiveness of those ads that tell a branded story, Potter says.
Consider the “Wish Writer” branding ad campaign the retailer ran during the 2015 holiday season that included TV commercials and video ads on Facebook, Instagram and YouTube. The ads, which featured a wish-granting pen, encouraged children to believe the magic of the holiday season. The ads were meant to be entertaining and didn’t feature any products (save the pen, which sold in Macy’s stores for $14.99)—and didn’t even include Macy’s branding until the end of the spots, which ran 15 , 30 and 60 seconds on TV and up to 3 minutes online.
On Instagram alone, Macy’s presented the 15-second version of the ad to more than 20 million shoppers—a mix of its existing customers and consumers with similar demographics to that customer base—and it received nearly 3 million views—far more than Macy’s anticipated, Potter says. Moreover, a post-video survey found that consumers who watched the video had a significantly more favorable feeling about Macy’s than those who had not watched it. Those metrics are among the retailer’s early steps at finding ways to understand how its branding ads influence consumers.
“We know how direct response marketing works,” Potter says. “But we’re very interested and invested in going beyond that to understand how all of our ads influence the way consumers interact with our brand.”
Macy’s initiatives are in line with those at Facebook, which is focused on what Nicolas Franchet, the social network’s head of retail, e-commerce, global vertical marketing, calls “performance branding.” The idea is to find ways to measure the return on investment for ads that don’t aim to drive a shopper to take an immediate action but rather seek to highlight the retailer’s brand or the products a retailer sells.
“It’s a complex notion,” he says. “Impressions, particularly on mobile, can be an important part of the path to purchase. But there’s an enormous body of work that needs to be done to correctly attribute their influence.”
Figuring out solutions to help retailers better measure branding ads, and mobile ads in general, is extremely important for Facebook given that 78% of marketers’ Facebook ad spending in the third quarter was for mobile ads, while only 39% of the sales that stemmed from Facebook ads during the holidays occurred on a mobile device, Facebook tells Internet Retailer. That’s up from 33% a year earlier but still far behind where advertisers are allocating their budgets.
“Consumers aren’t waiting for retailers to figure out attribution,” Franchet says. “They’re already on mobile devices. That means we have no choice but to figure this out.”
That explains why Macy’s, No. 7 in the Internet Retailer 2015 Top 500 Guide, took a multifaceted approach to analyzing its “Believe” campaign on Instagram. It looked at views as well as engagement—such as whether a consumer commented on, liked or shared the video. The retailer also examined the differences in how consumers Macy’s already has in its email database compared to consumers who share common characteristics to that group but are unknown to the brand. The retailer did so by using Facebook’s Custom Audience tool, which lets advertisers use non-Facebook information, such as their email lists, to target ads on Facebook and Instagram, and the social network’s Lookalike Audience tool, which lets marketers direct ads at consumers who share similar traits to a Custom Audience segment.
Branding ads are important to Macy’s, Potter says, because they enable the retailer to interact with shoppers in a way that isn’t just pushing a sale. “It lets us have a different type of conversation with our customers,” she says. “If we can show that people have an appetite for these ads, and that the ads work, it might lead us to expand our efforts in that direction.”Favorite