Digital marketing platform Smartly.io’s machine-learning technology helps personalized picture book retailer Lost My Name better allocate its resources.

All it took for U.K.-based personalized picture book retailer Lost My Name to reduce its cost per customer acquisition by 17% was to automate its Facebook advertising campaigns.

Lost My Name’s business is highly seasonal, with the vast majority of its sales taking place in the final three months of the year. While the retailer does some TV advertising in November and December, about 70% of its paid marketing budget is allocated to Facebook, says Anne Thouas, the retailer’s head of awareness marketing.

Until last year the retailer managed its Facebook advertising campaigns in-house. But as the retailer’s business grew and expanded into new markets, Lost My Name reached a point where it either had to hire more staff or an agency to help manage its Facebook campaigns or turn to an advertising automation vendor that uses artificial intelligence and machine learning, she says.

Lost My Name was intrigued by the idea of automating its Facebook advertising campaigns, which largely consist of direct-response link ads that drive consumers to the retailer’s site, along with some retargeting ads aimed at the retailer’s existing customers and consumers who have visited the retailer’s site. To gauge whether automation would help it scale, it pitted Smartly.io’s automation technology against a staff member who manually allocated the retailer’s budget.

Smartly.io’s technology enables a retailer like Lost My Name to choose a goal, say drive sales or clicks to a retailer’s website, and set a budget. The technology then tests the retailer’s ad campaigns to determine the optimal budget distribution for the stated goal.

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Within a few days of launching its test, Lost My Name saw the Smartly.io technology shifting dollars around in ways that, on the surface seemed overly aggressive, Thouas says. For instance, on one day the system allocated 200 pounds ($255.80)  out of a 2,000 pound ($2,558) budget to a particular ad set. The next day it increased that spending to 800 pounds ($1,023.20).

“We would never make such a big swing,” she says. However, the technology’s algorithm paid off: It boosted the retailer’s conversion rate by 36.1% and reduced its cost per acquisition 17.0%. Those results convinced Lost My Name to switch to Smartly.io, which typically charges 5% of the managed ad spend (Lost My Name received a discounted rate because the companies share an investor).

Smartly.io has transformed the way Lost My Name approaches Facebook advertising. “We were way too quick to give up on creative that didn’t seem to work,” Thouas says. But Smartly.io tests ads out and, if they fail to deliver immediate results, it then tests them again a few days later. The approach has helped the retailer discover that “bad luck” may cause an otherwise effective ad to fail to produce results, she says.

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