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Vermont Teddy Bear Finds the Secret to Doubling Google Shopping Revenue During Peak Season

THE SCOOP

Vermont Teddy Bear Company owns four highly seasonal brands—Vermont Teddy Bear, PajamaGram, PajamaJeans, and Vermont Brownie Company. The retailer wanted to reallocate its Google Shopping budget to acquire new customers, and not overspend on those who already know and trust its brands.

But the retailer had no way to do this with its agency, which had limited Google Shopping knowledge and no technology to advance channel performance. That’s when Vermont Teddy Bear Company partnered with Sidecar.

PROFILE

Retail Categories
Toys, Gifts, Apparel
Websites
Headquarters
Shelburne, VT

The Problem

inefficient spending

Vermont Teddy Bear Company has its eyes set on efficiency in Google Shopping. The retailer defines revenue and cost/sale targets monthly, aiming for especially aggressive goals during its busy seasons. Those include Valentine’s Day and year-end holidays for all its brands, except PajamaJeans, which peaks in the spring and fall.

“We have the conflicting goals of trying to earn as much revenue as possible, but at a very efficient ad cost,” said Donnie Ager, Digital Acquisition Marketing Manager for Vermont Teddy Bear Company. “And we’re responsible for carrying that out across not one, but four sites.”

Initially, the retailer outsourced Google Shopping management to a digital agency, which took the traditional approach of adjusting bids manually and structuring campaigns by product type. But Ager found that the manual management was too slow, and the agency struggled to understand his business and develop Google Shopping strategy for it.

“We often had to go into AdWords ourselves and point out areas that needed to be improved,” he said. “Performance had been the same for a while, and we really wanted to grow the channel. We thought that if we had better account management, and technology to automate our efforts, we could drive much greater success on Google Shopping.”

Ager also felt he was overpaying for high-intent traffic. “We market across digital, TV, radio, and catalog,” he said. “We know the exposure spurs consumers to Google our brands, with the intent to visit our sites directly to make a purchase. We wanted to reduce Google Shopping spend on these consumers since we were already winning them through other means, and focus on acquiring new customers.”

Ager researched the market for an advanced approach that would meet his goals. It was critical to find a technology solution that would save money and time, build revenue, and scale across all sites, as well as a team that would develop channel strategy in lockstep with Ager and his business objectives.

“That’s when I found Sidecar,” he said. “I spoke to people who are directly related to the company’s machine learning technology. They explained how it would continuously use product performance data and search queries to optimize each bid. The approach was innovative and made perfect sense. I was convinced.”

BY the Numbers

4000
SKUs
across 4 sites
94%
Revenue Growth
for Vermont Teddy Bear YoY
22%
Below Cost/Sale Goal
for PajamaGram
67%
Cost/Sale Reduction
for PajamaJeans YoY

The solution

Granular Control of Search Traffic

Sidecar’s team redefined Vermont Teddy Bear Company’s entire Google Shopping strategy. The new approach is centered around Search Query Management, in which Sidecar leverages search terms heavily to refocus spend where it has the greatest potential for converting new customers.

To execute this approach, Sidecar reworked the campaign structure of every site, creating separate campaigns for traffic originating from trademarked and non-trademarked search terms. The team implemented Sidecar for Google Shopping on each site to automate the bid strategy and meet specific cost/sale and revenue targets.

“Right off the bat, Sidecar provided stronger account management and a technology that suits all our product catalogs,” said Ager. “The team is helping us grow revenue and allocate budget much more efficiently, which is exactly what we want.”

Sidecar for Google Shopping works on each of the retailer’s sites by ingesting and analyzing several datasets, including Google Shopping data, product feed attributes, the retailer’s goals, and consumer search behavior. This data comprises the Sidecar Retail Index.

Sidecar’s machine learning algorithms use this data to understand each product’s performance and how it is trending, every day. These algorithms also continuously analyze every search term driving traffic to the retailer’s ads. Based on the traffic’s conversion potential, Sidecar adjusts product bids to meet the retailer’s goals.

For instance, within non-trademarked campaigns, Sidecar bids more aggressively to outrank competitors while efficiently converting new customers. Within trademarked campaigns, Sidecar maintains a high impression share among the loyal customers searching for its trademarks by name.

“With Sidecar, we’re now capturing new revenue from customers that found our product ads from non-trademarked searches,” said Ager. “At the same time, we’re saving spend on customers that know and trust our brands, and who will visit our sites anyway.”

By contrast, the only option Google provides to leverage search queries for Shopping campaigns is negative keywords. The shortcoming, however, is that negative keywords completely negate traffic, blocking clicks that could amount to worthwhile revenue. Sidecar, on the other hand, lets the retailer capture all traffic in a manner that’s cost-effective and aligned with its business objectives.  
Sidecar gives us a round-the-clock worker in the AI, plus the experts who understand the AI and diligently manage it to best reach our goals.
Donnie Ager
Digital Acquisition Marketing Manager for Vermont Teddy Bear Company

the results

exceeding performance targets

Vermont Teddy Bear Company has exceeded multiple target metrics as a result of its new Google Shopping approach with Sidecar. A major factor contributing to this success is the retailer’s non-trademarked campaigns, which receive the bulk of the retailer’s Google Shopping spend and continue to deliver double-digit growth. Here are some highlights:

Vermont Teddy Bear

Non-Trademarked Campaigns in December

REVENUE COST/SALE CPC
3% Above Goal 14% Below Goal
16% YoY Reduction
37% YoY Reduction

Non-Trademarked Campaigns in February

REVENUE CPC
74% Above Goal
94% YoY Growth
15% YoY Reduction

PajamaGram

Non-Trademarked Campaigns in December

REVENUE COST/SALE
34% Above Goal
31% YoY Growth
22% Below Goal
8% YoY Reduction

PajamaJeans

Non-Trademarked Campaigns in March

REVENUE COST/SALE
137% YoY Growth
67% YoY Reduction
The retailer is seeing strong efficiencies in its trademarked campaigns as well. Sidecar maintained an 83% impression share of trademarked terms for Vermont Teddy Bear in December. And among PajamaGram’s trademarked campaigns in the same month, Sidecar reduced cost/sale by 15% while growing revenue by 78% YoY.

“Sidecar knows our business, and does a fantastic job managing the balance of being aggressive and being conservative to attain our goals,” Ager said. “Our account manager is confident, reliable, and communicative. I don't need to check in as often on Google Shopping performance because I trust that she is looking out for us.”

Ager has increased his Google Shopping budget by 17% since working with Sidecar. “That increase was based on our strong Google Shopping performance in 2016, combined with our expectations of what Sidecar would enable us to achieve in the coming year,” said Ager. “We anticipate our spend will continue to increase as we see the results we want from our product line.”

Ager sums up the biggest benefits he’s seeing from the partnership: “Sidecar gives us a round-the-clock worker in the AI, plus the experts who understand the AI and diligently manage it to best reach our goals.”

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