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E-commerce Brazil

How Magalu Increased ROI by 55% and Decreased CAC by 25%

Magalu is a leading retailer in Brazil positioned as a digital platform (Magazine as a Service) connecting sellers and buyers with 1st and 3rd party inventory. Magalu’s e-commerce marketplace supports digital sales for over 1100 retailers across Brazil. See more here.

55%
increase in roi
25%
decrease in cac
13%
decrease in cpi

Challenge

Magalu had several areas of business they wanted to improve:

Digital Marketing
Goal - improve the campaign performance of their product ads and increase click-through rate, getting ready in time for Black Friday

Business Intelligence
Goal - better understand the performance of both their own sales, as well as those of 3rd party partners on the marketplace

Commercial
Goal - increase their overall profitability (cash margin)

Marketplace
Goal - retain top-selling retailers while expanding the overall marketplace by engaging new sellers (long tail distribution)

magalu_challenge_v2-1

Solution

ROI Hunter started helping Magalu’s campaign performance by making the campaigns more visually appealing and exciting. How?

Templates! Magalu had noticed a boost in performance whenever they changed the template of their campaign, so ROI Hunter connected them with multiple attractive templates to use in each campaign rather than just the single plain one:

magalu_templates

A new template was also created for the Magalu app-install campaign, combining it with top-selling products, which yielded a 13% decrease in cost per install (CPI).

During the Black Friday rush, Magalu also used ROI Hunter’s Creative Factory to create eye-catching product videos in just minutes, promoting automatically selected products from the site. 

This was a great improvement to the appearance of digital campaigns; next, we wanted to take a look under Magalu’s hood to see what else we could do to improve the company's profitability.

In order to enhance the visibility of Magalu's inventory on a product level, we first helped to solve their Business Intelligence issue by helping them create custom dashboards. These dashboards showed key performance data for both Magalu’s sales, and the sales of the retailers in their network.

dashboard

With accessible analytics and a bold new campaign look to roll out, it was time to tackle the issue of improving profitability. Magalu has a 7-8 digit catalogue of products. They needed an efficient way to be sure they were promoting the right products on the right channels.

ROI Hunter’s custom data integration made it possible to automate ads connected to the input they got from BI and Commercial. This led to an increase in overall ROI of 55%, and a decrease in customer acquisition cost of 25% when compared to use of the full catalogue.

magalu_result-1

Excited by the success of their product lists, Magalu reps. started considering other teams that could be helped through ROI Hunter’s Product Insights. One of those teams was the marketplace area.

When a new retailer joins Magalu, it's looking to see results. If the retailer sees sales coming in, that retailer's engagement with the platform and the availability of products will increase. By connecting and promoting selections of new seller products together, Magalu was able to foster platform participation and a long-tail focus (SMB). This new seller campaign led to at least one sale for 51% of the products promoted this way, and a 5% increase in Facebook shares for the small and medium businesses.

magalu_solution

Results

Digital Marketing
Customizable, attractive templates were enabled for promotions, and eye-catching product videos were able to automatically generate videos from static images on the site.

Business Intelligence
We developed custom dashboards for Magalu, enabling them to monitor the performance of both their own products, as well as those of 3rd-party sellers partnered with them.

Commercial
Our custom data integration made it possible for Magalu to promote products from their selected product list on social with dynamic product ads on a prospecting campaign.

Marketplace
Fostering new sellers’ engagement is key to Magalu’s 2020 strategy of having all products available in their webstore/Super App.

We at ROI Hunter are glad to have had the chance to contribute to Magalu's success.

magalu_result_v2

55%
increase in roi
25%
decrease in cac
13%
decrease in cpi
magazineluiza_quote
Jocasta Bortolacci, Media Coordinator

“We always wanted to make our commercial priorities actionable over social to increase our business profitability. ROI Hunter has made it possible. What was once our deficiency is now our strength.”

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