Carolina Gomes is the Director of Performance Marketing at Old Navy. She speaks to us about how using an open-to-buy budget system and continuous communication with brand and finance partners is helping her team futureproof.
How are you and your team embracing agility in real-time? What’s worked and what hasn’t?
As a retail company, this is such a relevant subject for us. Normal holiday surges driven by Black Friday sales and more recently, supply chain issues, have all created unique inventory challenges for us.
One thing that has been crucial in helping us stay ahead was implementing an open-to-buy budget system. What this means is that we aligned with finance that as long as we could invest our media budget at the right ROAS target, we were not constrained to daily, weekly, or monthly budgets. But we had to make sure we had the right relationship built with finance before we could get this alignment just right and eventually, we were able to establish that we were a profit center for the business.
Once we were able to do that, we had the trust we needed to make this kind of system work for us, and we were able to keep budgets flexible and maximize spend and demand throughout the year and minimize pressure during key holiday days.
So, what didn’t work? Well, despite our best planning efforts, Cyber-Five, the five days between Thanksgiving and Cyber Monday, fell short for several reasons. This was a triple whammy of increased competition, supply chain issues and privacy change rollouts, which cut our ability to drive profitable demand.
So, despite our open-to-buy system, we were not able to drive the expected volume that we had anticipated during those five days.
How have the changes in privacy laws surrounding what data is available impacted you? How are you managing and reporting on your ROI?
We are not facing many reporting challenges quite yet, but that is because we are not driving any paid media traffic to our app. So, some of the actual outcome strings aren’t impacting our efforts, yet.
But we are working towards driving traffic to our apps soon, so we are hoping to learn from those who will pave the way. Although at Old Navy, we leverage our internal tools as the main source for measuring channel performance.
Over the past few years, we have moved away from direct reporting and embraced a media mix model that better helps us measure the incremental impact on media investment across the funnel. But privacy changes are still a big deal for us; however, knowing what to anticipate will help us be ready to pivot.
It continues to be important for us to make sure we set expectations with our business and financial partners because we are already seeing impact in return on ad spends due to cost increases and retargeting audiences being impacted by privacy rollout. Expectation setting and communication with non-media partners is such an important part of what we do. We have to prioritize bringing them along for the journey and educating them on the nuances of media buying and privacy constraints.
How can brand and performance work most effectively together?
Having a full-funnel media plan is key – ensuring you develop a media plan with clear goals and strategies for each stage of the funnel.
Having a plan in place is critical to ensuring that you are effective and successful in supporting both your business and brand goals.
We have embraced this approach at Old Navy for years and we act as one team. Performance data falls under marketing under the brand team and between the upper and lower funnel – we’re constantly working together.
One of the things I’m most proud of over the past few years was establishing test-and-learn agendas and best practices from lower-funnel to the full funnel. This practice has allowed us to look at all our strategies and media tactics as a way to test new platforms, new ways to optimize and new ways to buy that could support business or brand goals.
One of our main goals this year is to socialize even more with our brand partners but also with merchandising and commercial planning teams to make sure we’re responding quickly to what we’re seeing and what the customer response showing us.
Marketers That Matter® is a community of top marketing executives coming together to pioneer the future of marketing, sharing real-time experiences, and solving current challenges.
Our parent company, 24 Seven, specializes in helping you find exceptional marketing and creative talent for your teams.