We’ve heard repeatedly that marketers must make their dollars go farther, but what does that mean in practice? Hear Cameron Alverson, Director of Media and Analytics at Living Spaces, as he shares his experience with driving more efficient media spend and how his team used data to quickly shift tactics when the website became the new primary storefront during the early part of the pandemic. His quick thinking earned him the RampChamp Master of Agility award.
Jennifer Tyler: Hello everyone, I’m Jennifer Tyler. I am a Commercial Lead at LiveRamp and am joined today by Cameron Alverson, Director of Media and Analytics at Living Spaces. Thank you, Cameron, for joining us.
Cameron Alverson: Of course.
Jennifer: If you wouldn’t mind, I’d love to hear a little bit about your role at Living Spaces.
Cameron: I joined Living Spaces a little more than a year ago. My role is a little bit unique. My team is responsible for both media buying—any paid media, whether it’s offline or online—as well as the analysis of that media. Those two usually have been broken out in separate teams, but my team is actually doing both, which has provided us with a lot of efficiency and benefits.
Jennifer: Interesting. Now I know a lot has changed over the last six months and we’re still in the midst of the pandemic. I know when I first started speaking with you, things were in a much different place. As we started to begin working together, COVID-19 basically caused most retailers to start closing their doors. I’d love to hear how you’ve seen your business evolve over the last six months, and also how that’s changed your role, and some of the obstacles you’ve had to overcome.
Cameron: We are not alone in how COVID-19 has impacted our business, which was primarily in-store. We had what we felt was a healthy web business, but it was still a small minority of our sales. We found ourselves having to close down nearly all of our stores almost overnight. It was a weird and scary time for us, as I’m sure it was for a lot of people, and it required us to stop and reevaluate. What do we do next?
Fortunately, the company itself had done a lot of preparation from a financial perspective to ensure they were ready to weather any storm that came up. They knew something would happen sometime. They didn’t expect this of course, but it gave us a chance to pause, retrench, and reevaluate.
All of a sudden we’re an online-only business and a lot of people don’t want to buy a sofa without seeing it in person first, so we weren’t sure what would happen. It required us to reevaluate what we did in terms of media, and really required an evolution in how we were going to interact with customers. As far as my role is concerned, coming into this thinking about both the media buying and the analytics, it really put analytics front and center.
We anticipated a drop in revenue, which of course happened, and with a decrease in revenue, it meant that our media spend had to be as smart as possible. We dropped a bunch of upper-funnel tactics and focused on mid- and lower-funnel. Over time it required us to start thinking about what the consumer journey was going to look like going forward. We learned we had to throw out the window pretty much everything we knew about our customers and the pre-pandemic purchase cycle. How do we engage with them? What do they care about? What should our messaging be? How do we contact them? Are there certain audiences that matter most? It changed a lot about how we thought about things for sure.
Jennifer: I know you mentioned to me that the biggest KPI you are measured against in your department was getting people in the store. What became the “new” most-important KPI once things went to an e-commerce model?
Cameron: It became apparent pretty quickly that the lifeblood of the company was going to be getting as much revenue as we could, however that came in. My team was tasked with figuring out how we drive revenue, wherever it may be, and how we make sure we’re doing that as efficiently as possible. So return on ad spend became a primary focus in those first couple of months of the pandemic and the lockdown. This represented a significant shift, because most of our KPIs, measurement, and attribution were based around the idea of getting consumers into the store, letting them see the products and experience them, and then let the sales people take it from there. So we had to focus on revenue and on how to drive sales. Even as the stores opened up again, we were still very focused on driving enough revenue today. While store traffic has become an important component again, the revenue piece still is really the main focus.
One of the things that’s happened, and I suspect this happened for most people, is that the pandemic hastened trends that were probably already in progress. For us, the e-commerce aspect of our business is now a much larger piece of the pie than it ever was before. We think we would’ve gotten to that eventually, but not for a couple of years.
The pandemic forced us to rethink what the right KPIs are for the different marketing tactics that we’re doing. It’s no longer just about getting consumers to the website so they’ll eventually go to the store in person. Now, if they’re going to the website, there’s a good chance they also feel comfortable buying online without seeing the sofa in person, which we weren’t sure would ever happen. So that has been an important evolution for my team, and for the company overall.
Jennifer: Are there any things that you’re really thankful for that you accomplished prior to the pandemic that helped your team cope with all of these changes?
Cameron: There were a couple of things that ended up being fortuitous. One was that we had been working on shifting the focus of my team from a siloed approach, where the three disciplines were kind of doing their own thing, to working in a more collaborative, unified way. We got rid of the divisions of offline versus digital budgets and it became one budget. We started thinking instead about what each market needs and what’s the right level of budget for remarket, knowing there may be one market where we go heavy on digital and another where we go heavy offline.
When I think about it from that holistic perspective, it was a huge benefit to us once the rubber hit the road during lockdown. It all hinged on what the numbers were telling us was most and least effective. At the beginning there was some resistance to the idea, but that’s natural. It was a shift. I think having made some significant strides before the pandemic meant that once it hit, we were in a much better position to take advantage of some of those efficiencies in ways we didn’t before, and take a more collaborative approach.
The other thing that was fortuitous that I wish that my team could take credit for is that we had been working on a free shipping option. We were ready to launch it right as the pandemic hit and everything shifted to e-commerce. All of a sudden my team had something to pitch, and that became a huge competitive advantage for us, and helped my team to have something to connect with consumers about too. The timing there couldn’t have been better.
Jennifer: For all of these reasons that you’ve just described, as you know, I went ahead and nominated you for a master of agility award. It’s a new ramp champ award that we’ve introduced at LiveRamp. It’s really because I was able to see the many ways you and your team were so nimble and fast as the pandemic spread across the retail industry. I was impressed with everything you guys put into place, and with the results you were able to see pretty quickly based on the changes that you made, so congratulations on that.
Cameron: Thank you.
Jennifer: In closing, I want to hear what you’re thinking about for the future. What’s up-and-coming for Living Spaces in the next year or so, and how have some of the changes you’ve put into place right now, such as a thriving e-commerce business, come into play next year?
Cameron: Well, e-commerce is definitely going to be a centerpiece of our strategy moving forward. We’ve made some significant strides as a team, specifically in terms of the collaboration I mentioned before, but there’s still a lot for us to do. I come from an analytics background, so I address these types of problems with a data mindset, always trying to figure out which levers to pull.
There are some things I’m really excited about that I think will have an impact, and some steps that we still need to take that I’m very optimistic about, but really the focus for me and my team is understanding the consumer perspective and how different media tactics influence the customer journey. For example, we look at different markets and how mature those markets are for us, how long we’ve been there, how we measure our brand health. We try to ask, how familiar are people with us? How likely are they to consider our brand? How much do they shop with us?
All of that feeds into decisions about where our main opportunity is to grow the business. We want to focus on identifying consumers who are in the market right now, help them understand why they should shop with us, and make sure that we serve them offers that are relevant. So it’s more mid- and lower-funnel tactics. Taking this more market-specific approach by identifying who those audiences are and how best to communicate with them is how we continue to evolve, and I think those elements are going to be critical to us being successful as we move forward.
I also think a huge opportunity for us is the idea of getting really granular with certain audiences. Which messages are going to resonate better with certain audiences? Even if it’s low- and mid-funnel tactics on the same channel, maybe one demographic needs to hear the message or the value prop framed a little bit differently than another group, where in the past—and perhaps not unlike a lot of other marketers—we’ve taken the approach of putting the content out there and letting Facebook’s or Google’s algorithm decide for us.
There’s a huge opportunity for us to be much more proactive about identifying those audiences, testing specific messaging with them, and of course, accurately measuring the results. We can see what needs to be addressed and we know which levers to pull to address those things. So we pull those levers and watch. It’s really about integrating the data and analytics into the strategy—day by day and week by week—instead of being reactionary, and those are things we’re still working on. I feel like we’ve made positive strides forward, and even though there’s still a long way for us to go, I’m very excited about the potential.
Jennifer: Awesome. Well, thank you so much, Cameron. I wish you guys all the best in the coming year and am excited to be partnered with you and watch all of this unfold.
Cameron: Thank you.
To learn how to drive business growth in a challenging economy, read this blog.