Paid ads are a core component of any marketing strategy, particularly for our beauty brands.

But with the arrival of new and smaller competitors in the paid ad space and increasingly aggressive bidding, ad spend spiralled, and it became harder and harder to get seen by the right customers in the right places.

In 2022, THG Commerce needed an ad network that could connect our brands with consumers, displaying ads in the right places, at the right times, to the right people. For THG Commerce, the clear solution was AdMedia – quality traffic that delivered true performance.

Explore our partnership journey below. 

The challenges

Since post-Covid, we experienced significant cost inflation in our Google ad spend.

With the introduction of the automated Performance Max (PMax) solution, new or smaller competitors were able to compete more effectively against our ads in the same space. In response to this, our core competitors also began bidding more aggressively.

As auction intensity increased, so too did price competitiveness. As a result, clickthrough rates (CTRs), cost-per-click (CPC) and conversion rates were impacted, bringing challenges in managing overall cost of sale (COC) at the scale required.

To overcome this, THG Commerce needed an ad network that could deliver a search solution that would effectively offset our performance pressures.

One that could help diversify our offering outside of our existing ad networks, drive stronger new customer acquisition (NCA) at better customer acquisition cost (CAC), and dilute cost of sale (COS) through cheaper cost per click (CPC) and stronger intent-based targeting.

That solution was AdMedia.

The solutions

Towards the end of 2022, we launched AdMedia across LOOKFANTASTIC and Dermstore.

Beginning with a limited test budget, we saw some strong and promising results. As a result, we entered the first half of 2023 with the aim of scaling our investment further and improving our channel mix.

Our partnership with AdMedia significantly expanded our search offering, landing exclusive placements on dedicated shopping apps such as Laybuy, Klarna, Afterpay and Affirm.

Alongside this, AdMedia also offered intent-based search solutions across privacy browsers including Firefox, Opera and Ask.

As a result of this, our beauty brands were able to reach new, more privacy-focused audiences. This maximized our exposure on shopping sites with unique placements that complemented our affiliate channel activity and increased visibility on relevant home and search pages. 

The results

“The results from our partnership with AdMedia have been phenomenal. With significant reductions in cost of sale, stronger conversion rates across the board and an impressive uplift in revenue, it’s a powerful partnership that’s genuinely elevated our brand performance.”  – Richard Ward – CEO, THG Ingenuity

Our partnership with AdMedia delivered some stand-out results across LOOKFANTASTIC and Dermstore.

Globally, our partnership helped grow percentage revenue by +10% MoM, with our percentage of PPC revenue/spend growing ~10%, month over month.

Our average CAC is £11 lower compared to other ad networks, helping to dilute in-channel new customer acquisition costs.

Indeed, for the regions in which we operate, our AdMedia partners drive 3.6% of NCA, helping to drive a substantial cost saving than if we sought to acquire these through our other ad networks.

In Spain, AdMedia contributes 20% of our PPC revenue, with a significantly stronger CVR of +3.73pp compared to our other ad network. This growth has helped considerably in offsetting CVR challenges with product listing ads (PLAs) across the region.

In France, the Netherlands and Germany, AdMedia represents 10%, 7.5% and 6.5% of our revenue, respectively. This also comes with room to scale for incremental gains in non-branded terms, given our content management system (CMS) reattributes more revenue to the channel compared to our other ad network.