Retargeting With The Pros: The Breakdown of a $10.9 Billion Dollar Company

Posted on March 1, 2018

When I hear the word Lululemon, my mind wanders to a swanky suburb where a classy woman is walking home from the gym, her labradoodle on one hand with a Grande, Quad, Nonfat, One-Pump, No-Whip, Mocha in the other. And while I do like to make jokes, the company itself is not playing around. The $11 Billion dollar giant has quickly risen to the top in almost every fitness wear category, posting an amazing 13% growth in its direct to consumer division for the 2017 fiscal year.

With this impressive growth, I wanted to take a quick look under the hood of one of their strategies, their retargeting stack on Facebook. I’m going to do my best to reverse engineer what they are doing, with the caveat that there is a lot going on behind the scenes in terms of bidding strategy, optimization goals, and creative testing that cannot be seen from the outside looking in. (If you are here for the practical takeaways, go ahead and skip to “the details” section of this article where you will find a quick guide for recreating this retargeting stack).

To start let’s go back to the beginning, Lulu’s website. When thinking about retargeting, the first step is to make sure you are tracking the behaviors that are significant. These include; page views, content views, add to cart, initiate checkout, and purchase. As you can tell from using the chrome extension Facebook Pixel Helper, Lulu has each event set properly. Every time someone takes that action on their website that data point is collected.

The Retargeting Teardown

Since I am not a millionaire or a fitness junkie this was my first visit to Lulu’s website, and I’ve got to say it is impressive. The beautiful imagery, clean layout, and welcoming copy shows an attention to detail that I am sure is reflected in their $100 sweatpants. I took a casual stroll through their men’s section and landed on a very nice coat. I clicked on that product page, browsed for a hot second, then vanished like Bitconnect’s leadership team. This triggered the “View Content” event within Facebook. Then when I started browsing Facebook I was served this ad within 3 hours.

This is a phenomenal execution by Lulu. This ad is tailored to me (coats), its gently telling me “we see you” while also offering an invite back to the store to see coats for all occasions.

Over the course of the next few days Lulu did an excellent job of rotating different creative and placements to stay relevant in my newsfeed and to continue to try and win back my business.

The Details

Reading about this retargeting strategy is a lot of fun, because let’s be honest, I’m hilarious. But now let’s chat about how you can execute a similar strategy with your own campaigns. To begin, we need to make sure you have a few things set up properly.

  1. Business Manager Setup
    1. I’m not going to spend a ton of time here, because it is my hope that you have this step down. But for the freshie’s (yes I got called this in highschool) Facebook has a great guide to help you get started. It is key to mention that to set up the next step you must have admin access to the ad account and product catalog of the business you are working on. For more information on account roles and how to request different levels of access go here.
  2. Product Catalog Creation & Setup
    1. This is where the fun begins. Your product catalog in Facebook is simply a data feed of the products you are wanting to advertise. The data that is held is as follows; a description of each item, including an ID, name, category, availability, product URL, image URL and other product attributes. How you set this product feed up is dependant to the eCommerce platform you are using, and some platforms are much more difficult to deal with than others. While this feature comes standard with a store built on Engine #shamelessplug, most other platforms require either a plugin, or creation of an RSS feed by a developer. Because we like you so much, here are the links to learn more based on the platform you are currently using.
      1. Engine $0 (because you shouldn’t have to pay extra for essentials)
      2. Magento $39
      3. Shopify $0 (it is a 3rd party application named Flexify)
      4. WooCommerce $50-$150 depending on plugin
      5. BigCommerce $0
    2. Once you have your product feed URL, take the next steps to upload it into facebook;
      1. Go to your business manager
      2. In the top left corner click the dropdown, and scroll to the right to the “assets” tab, click on “catalogs”
      3. From there follow Facebook’s instructions on how to set up the main product set.
    3. After setting up the main catalog, I recommend setting up product sets by collection. So, have your main product set, then a separate set for each type or category of product you carry (i.e. “jackets”, “shirts”, “shorts” “jammies”…you know, if you’re into that sort of thing).
  3. Pixel Setup
    1. Now you are rocking and rolling, and ready to become a Millionaire…right?
    2. Well, to do that you need to get your pixel setup correctly so you can follow your audience around like a father whose daughter is on her first date. For the sake of time, we are not going to cover base pixel installation here. It can get hairy based on the platform you are using. What we are going to do is take the next step in making sure your product catalog is set up correctly so when someone takes an action on your page, that action is associated correctly with your catalog. So, when you are finished setting up your catalog you will be directed to a page that looks like this. If you exited out, this URL should get you back there (it may not because Facebook changes URL’s often).  
    3. Once you are here, Facebook will guide you through setting up your pixel events to trigger correctly. Depending on the platform you are using, you may have a few bugs to iron out around this. Sometimes there is a miscommunication between the product catalog descriptions and the pixelation event on Facebook. If these problems occur, reach out to your platform support or developer to get them ironed out.
  4. Audience Setups
    1. Let’s all take a collective sigh of relief, we are done with the bulk of the technical work. You didn’t come here to work on code, you came here to party right?! Now that we’ve set this up we need to take a minute to think strategically about the audiences that are being built by our pixel events, and how we speak to those audiences based on where they are at in the funnel. I always like to take a common sense approach here. Imagine you’re walking down a hallway pushing a buggy ahead of you. The walls of this hallway are lined with all sorts of products, and at the end of the hallway, a beautiful person is smiling at you, waiting to take your money for the items you’ve decided to put into your cart. As your strolling, you see a sweater that you “just can’t handle” and you “gots to have it”.
    2. You stop and take a closer look at the sweater. This is a “View Content” pixel event.
    3. Now, in keeping with this visual, you take that sweater and throw it into your buggy. This is a “Add To Cart:” pixel event.
    4. Once you are satisfied you make your way to the beautiful person and they begin to ring your items up. This is an “initiate checkout” pixel event.
    5. Then you quickly realize you cannot afford that $500 cashmere sweater because you’re not a crazy person, so you walk out of the hallway crying on the inside. This is an abandoned checkout.
    6. Each one of these events is different, and it should be handled as such. So, let’s go through and talk about how we segment these audiences by events. First, you want to head back into your business manager, and click on your audience tab. From there you are going to start by creating audiences based on the pixel events. You click “create audience” > custom audience > website traffic > then for add to cart you do the following;  
    7. You should create this audience for each event, so you can get an understanding of the size of the audience you will be remarketing to. You also need to set up an audience of those who have purchased from your store in the past 30 days because you will need to layer that audience in as an exclusion in your campaign.
  1. Retargeting Campaign
    1. It all comes down to this, you’ve done the legwork and now it is time to put your retargeting plan into action. Based on the size of your store, you can do some really rad things when it comes to your retargeting. The larger your audiences, the more segmentation you can have. So I’m going to lay out 2 plans for those with larger stores vs. those who are growing.
    2. Large stores like Lululemon have enough event triggers to segment audiences based on the product, day, and behavioral patterns they are seeing on their website. What I mean by this is setting up Dynamic Product Ad’s (DPA’s for short), and segmenting them out by day, product viewed, and behavioral patterns on their website. This is a pretty complex task, and it is very specific to the brand. I will say this is a lot of work, and really makes sense when you are at the size and scope of a company like Lululemon. It doesn’t much so much sense when you are doing less than $10-$20k a month. For an overview of DPA’s go here.
    3. If you are running a large scale ad budget for a larger company, we would be more than happy to have a chat about your specific goals, and how to do those. We love chopping it up with any marketer, so if that is you leave a comment below and we will reach out.
    4. For the stores that are growing, a solid “template for retargeting looks a lot like this.
      1. Viewed Content Flow
        1. You will want to start by targeting people who have added to cart. Our beginning set up is, people who have added to cart past 7 days, excluding those who have added to cart or purchased in the last 30 days. This ensures your audience is only those who are looking at that sweater, but haven’t gone further down your funnel. The reason for this segmentation is to create a hurdle to get over before that person adds to cart. You may serve them with an ad with product reviews, sizing, the story of the company, your giveback, etc. Anything that you can think of that would encourage that shopper to add that product to their cart. After 7 days the people remaining in this audience are starting to go cold, they may just not be interested in the sweater they once looked at. So from days 7-14 you can start working to get them interested in other products, as well as encouraging them to give you their email address, as well as become a follower of your facebook page. You would simply set up a second audience of those who have viewed content days 7-14, excluding those who have viewed content days 1-7, as well as the add to cart and purchase exclusions.
      2. Add To Cart Flow
        1. Your add to cart flow will be very similar to your view content above. The only difference you could make here is during the first 3 days to push hard to get them to complete that checkout while it is still on their mind. So instead of days 1 to 7, you can split again to days 1 to 3, 4-10, 11-21,22-30…you get the point. When the customer added that sweater to her cart she showed real intent to purchase, and it is now your job to figure out what is making her second guess that decision. Is it pricing, maybe she unsure if she will receive it in time for that hot date, it could be a number of different things. That is what your ads are going to speak to here. You want to work hard to let her know “we got you”, so your copy and creative will speak to that. You may run an ad with a testimonial of how happy Susie was ordering from you, you could guarantee shipping times if they order today, get creative here. Then as the days go on, you rotate out creative like Lulu did with the different ad formats and start suggesting other products as well as offering a discount if that aligns with your brand strategy.
      3. Initiate Checkout Flow
        1. This is your warmest audience. The customer has added to cart, she has made her way to the checkout stand, and the items are rung up. There are really only 2 barriers to her finishing this purchase, price and shipping time. The retargeting stack here should be “to the point”, we want your business and here is what we are going to do to earn it.
  2. That’s All For Now Folks
    1. You’ve done it, and now the cash is raining down. I hope this teardown has inspired some creative thinking, as well as inform you of the possibilities when it comes to retargeting customers. Remember, every touchpoint is another opportunity to share your unique brand with your customer. Make it fun, make it memorable, and most of all, make the retargeting count.