Johnny Was’ Data-Driven Dive Into Google PMAX: 3x Media Efficiency With Incrementality Tests
Clay Cohen, Sr. Director of Product Marketing
Published 05/15/2023
3.1x increase in media efficiency – AI-driven ad products like Google's Smart Shopping and PMAX are transforming the advertising landscape, offering potential efficiency improvements over traditional shopping platforms. Brands like Johnny Was, a California-based women's lifestyle brand, are keen to harness these innovations to optimize their media strategies. In this case study, we explore Johnny Was' journey through multiple incrementality testing phases to understand the incremental impact of Google's AI-driven ad products and determine the optimal strategy for media efficiency.
Testing Google's AI-Driven Ad Products With Incrementality
Johnny Was had been successfully using Google's traditional shopping platform for years. The introduction of AI-driven products like Smart Shopping and PMAX piqued their interest, but they needed proof of performance before fully committing. They partnered with Measured to assess the impact of these newer products on their key KPI – net profit per dollar spent.
1.Smart Shopping Test
Measured ran an incremental lift test for Smart Shopping, revealing a low incrementality rate of 12%. While this result prompted Johnny Was to revert to the traditional shopping platform, they soon discovered that although it had a higher incrementality rate, the conversion rate and return on ad spend (ROAS) were lower.
2.PMAX Test
Undaunted, Johnny Was tested PMAX for their non-branded campaigns. Measured conducted a holdout test, discovering Google's significant over-reporting – it claimed credit for 4x more conversions than it caused. However, PMAX proved to be 2x more incremental than Smart Shopping, a finding corroborated by a subsequent geo scale test.
Achieving 3.1x Media Efficiency
With the insights gained from incrementality testing, Johnny Was reallocated their budget, resulting in a 3.1x increase in media efficiency. By using multiple tests to determine the optimal strategy, Johnny Was could confidently allocate their advertising dollars and maximize net profit from their Google spend.
The Future of Johnny Was' Media Strategy
Johnny Was' success story emphasizes the importance of an always-on testing strategy for optimizing media efficiency. The brand has maintained or even increased its spend on Google PMAX, confident in the knowledge that it delivers profitable outcomes for every dollar spent.
Conclusion
Johnny Was' journey from traditional shopping to Smart Shopping, back to traditional shopping, and finally to PMAX highlights the value of incrementality testing in determining the most effective media mix. By leveraging Measured's expertise and testing capabilities, Johnny Was could assess the incremental impact of each advertising tactic and ultimately enhance their media strategy efficiency. Brands looking to optimize their advertising efforts should consider adopting a similar data-driven approach to confidently invest in the most profitable channels.
