AdExchanger: How Shutterfly used a search-powered custom algorithm to find new customers

Reaching new customers is a big challenge, especially online. A CTV campaign run by Shutterfly ran at the end of last year to promote its holiday gift packages and photo deals found new ways to reach customers, according to a report in AdExchanger.

Shutterfly’s goal was to uncover new pools of potential customers to tap into. Rain the Growth Agency, its agency partner, suggested devoting a portion of its budget to test a custom algorithm that relies on search data, rather than deterministic or ID-based audience signals, to find geographic regions with the most prospects, according to the article written by Anthony Vargas.

Although Rain had never tested a search-based custom algorithm before, it made sense to identify markets with interest in a product category but low awareness of a specific brand, said David Nyurenberg, Rain’s director of video product development and innovation, to Vargas.

In other words, geos where lots of people are searching for digital photo services in general, but where brand awareness of Shutterfly lagged behind competitors.

According to the article, Rain sourced the search data from TV measurement company EDO, which can tie search insights to households within geographic markets using IP address and device ID matching. Chalice AI created a custom algorithm to ingest this data from EDO and determine which geos Shutterfly should target and when.

“We layered the algo on top of a bundle of different CTV PMPs – all premium stuff like Hulu, Peacock, Spectrum, Paramount, Samsung, and Roku,” Nyurenberg said. “And then the algo just flexibly optimized across all those PMPs within the markets that appeared to need the media in a given moment.”

Rain tested the search-based custom algorithm against other targeting and optimization tactics, including keyword targeting, retargeting, lookalike modeling, third-party audience segments provided by a contextual vendor, and an automatic content recognition (ACR) vendor. Rain declined to name these vendors on the record.

The custom algorithm outperformed in terms of driving site visits, account setups and photo package purchases from new customers, based on measurement by iSpot.tv. From October to December, between 17% and 19% of the conversions attributable to the custom algorithm came from new customers. Most of the other tactics hovered in the 10% to 15% range. Retargeting was the least effective method for reaching new customers, accounting for just 8% of the audience.

Read the full article here.