Optimizing CPAs by Breaking out Small Geos in Twitter Advertising
Published: June 29, 2017
Author: Carolanne Hornung
Advertisers with smaller budgets who target EMEA countries are familiar with one of most commonly encountered challenges: small geographies with the necessary layered targeting yield small audiences. This is especially true when targeting geos like Germany, Ireland, and the UK on a platform like Twitter.
The gut instinct in these situations would be to combine all geos into one campaign and keep your budget contained so you’re not splitting hairs too finely. If you have a $1,500 monthly budget to target an audience of around 440k, that would make perfect sense. But what happens if you were to break the smallest geo into its own campaign with its own separate budget? This is exactly what we tried in a recent test.
To give you a brief glimpse of our test results, we crafted a chart showing overall performance before breaking out campaigns and after breaking out campaigns:
Before, results yielded high CPCs and CPAs due to lower CTRs and CVRs. After, CTRs increased by 80%, CPCs decreased by 63%, and CPAs were cut by more than half. Interested in seeing how we did it? Read below to grab the campaign details…
When we originally began this test, we went the typical route and put all geos together to keep the budget focused. However, after running the campaign for a month, we saw performance from one geo stand out.
The UK was receiving the most spend due to its larger audience size but showed high CPCs due to heavier competition. Germany showed strong CTRs and average CPCs but yielded the lowest CVR and led to an over $50 CPA. But Ireland showed strong performance despite having the lowest amount of spend. With an average CTR and the lowest CPC, Ireland was able to make up 34% of the overall conversion volume at the most sustainable CPA.
After seeing Ireland’s positive performance when grouped together with the UK and Germany, we wondered what would happen if Ireland were given its own campaign and budget. During this test, we kept the UK and Germany grouped together. We ran this new campaign setup for an additional month to compare performance against the previous month’s.
The results were positively surprising. The UK, which previously had a CPA of over $40, was now able to increase conversion volume by over 300% with a 400% lower CPA. Germany saw similar improvements; though it began to receive less spend, it was able to double conversion volume from the month before and boasted a 69% more efficient CPA. Ireland, with its new budget, saw increased CTRs and CVRs, steady CPCs, and doubled conversions. While CPAs increased from $16 to $20, it was able to scale at what is still a largely efficient CPA.
If you’re looking for a direct comparison between the geos, we’ve included the chart below:
If you’re targeting smaller geos and have a small budget, don’t think your campaign is automatically going to fail. Breaking out budgets can be done successfully with smaller geos. Start by splitting budget 70-30 in favor of the larger geo to avoid overwhelming the smaller geo with too much spend too quickly. If you see success, shift budgets to 60-40. Don’t be afraid to test!
Have you tested geo breakouts before? Let us know what you’ve learned in the comments below!