RBC Uncovers Undervalued Channels and Optimizes Investments with Skai Incrementality Tests
Background
Royal Bank of Canada (RBC) is one of North America’s leading diversified financial services companies, providing personal and commercial banking, wealth management, insurance, investor services, and capital markets products and services on a global basis.
Challenge
In a previous test for the ad spend of RBC’s retail banking line of business, one of the key insights the RBC team uncovered was that Google and Facebook are undervalued by more than 10X and significantly outperforming RBC’s targeted cost per account opening. Based on this new information, there were several marketing measurement questions RBC wanted to explore: the most important was how much should RBC be investing across Google and Facebook to maximize its impact and help with attracting and retaining bank customers.
Solution
RBC’s team needed to understand the incremental impact of investing at different levels. The flexibility of Skai’s Impact Navigator enables marketers to perform a wide variety of marketing measurement tests to help drive data-driven decision-making. Skai partnered with RBC to design a five-week experiment to quantify the incremental impact of increasing RBC’s investments in Google and Facebook by 50%, 100%, and 200% compared to historical levels.
Impact Navigator’s algorithms designed a test in which markets were split into four equal parts:
- Budget remained constant in the control markets
- Budgets were increased 50% over the control in one test group
- Budgets were increased 100% over control in a second test group
- Budgets were increased 200% over control in the third test group
This structure allowed RBC to measure the impact of its Google and Facebook investments at three different levels to identify if increasing investments would drive incremental growth as the previous test suggested, and where they might expect to start seeing diminishing returns.
Test
Objective: Measure the incremental impact of increasing investments across Google and Facebook
Hypothesis: RBC is underinvested in Google and Facebook and would see efficient incremental growth from increased investments across the platforms
Warmup: Seven days
Measurement Dates: 28 days
Country: Canada (300 largest cities by KPI volume)
Geo-split: 75 cities in each test cell
Results
This test validated the results of the first test, demonstrating that not only was RBC underinvesting in search and social but also that they could increase their investments by 200% or more. This would increase incremental account openings by more than 10% while still remaining below their efficiency goals.
Next Tests
As a result, the RBC team is already moving to reallocate budgets to drive increased impact and planning additional tests to dig even deeper into what they have learned. Some of the marketing measurement areas they can explore include:
The impact of additional channels beyond search and social
With digital ad investment significantly undervalued, it raises the question as to whether there are other channels RBC should be investing in to drive further growth. And if so, what is the impact of introducing them into the media mix?
The impact of specific tactics across Search and Facebook
With an increase in budgets across search and social, it makes sense to dig deeper into specific tactics to understand the optimal budget allocation. Are budgets properly balanced across brand and non-brand searches? What about prospecting and retargeting? Further testing can help reveal the best places to increase investment and where certain investments can be better optimized.
About RBC
Royal Bank of Canada is a global financial institution with a purpose-driven, principles-led approach to delivering leading performance. Our success comes from the 87,000+ employees who leverage their imaginations and insights to bring our vision, values, and strategy to life so we can help our clients thrive and communities prosper. As Canada’s biggest bank, and one of the largest in the world based on market capitalization, we have a diversified business model with a focus on innovation and providing exceptional experiences to our 17 million clients in Canada, the U.S., and 27 other countries.
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