OTTO Drives High Spenders With Liftoff’s CPR Model

The Challenge

OTTO is an e-commerce platform based in Germany. Founded in Hamburg in 1949, OTTO grew from a small mail-order company into one of the most successful e-commerce companies in Germany with over 6,000 employees. As part of its pivot to a platform business model, OTTO opened its service to more brands and partners. Mobile played a crucial role in the expansion.

Part of their mobile growth strategy focused on driving new users to their app. Their top priority, however, was growing revenue by converting app users into loyal customers. When they looked for an advertising partner, OTTO searched for a media channel that could optimize for return on ad spend (ROAS) while meeting a high automation standard. For both criteria, Liftoff was a great match.

The Solution

OTTO launched new mobile campaigns on iOS and Android with Liftoff in August 2020. The campaigns were aimed at tapping a new audience that was likely to make frequent purchases. To reach the right users, Liftoff’s machine learning (ML) optimized for high-spending users using its Cost Per Revenue (CPR) Model

OTTO set ambitious targets for both D7 and D30 ROAS in the 200-300% range for both platforms. To evaluate Liftoff’s overall contribution to company revenue, OTTO also used their internal attribution model to track total profits and the estimated Lifetime Value (LTV) of new app users.

Creative experimentation also played a central role in driving performance. As an experienced retailer and publisher with diverse advertising solutions, OTTO supplied a wide range of creative assets for Liftoff’s campaigns. Through A/B testing, Liftoff enhanced ad engagement by showcasing the retailer’s products and branding in even more attractive ways. For example, a banner ad saw a 22% lift in installs by replacing a stock photo of running shoes with a product image. Another saw a 17% lift by adding a more prominent CTA.

Results With the help of Liftoff’s CPR model, OTTO’s app install campaigns saw an immediate increase in quality users within the first few months. During a competitive pandemic holiday season, Liftoff exceeded campaign ROAS goals:

  • D30 ROAS for Android outperformed targets by 72%
  • D30 ROAS for iOS outperformed targets by 236%

Due to the impressive results, OTTO quickly scaled up their campaigns on iOS and Android throughout 2021, and Liftoff’s campaigns have consistently reached or exceeded ROAS goals on both platforms.

An internal analysis by OTTO also shows that Liftoff helps acquire users with high LTV. Over the past two years, Liftoff’s combined ad spend on Android and iOS scaled 400%. The OTTO app is now OTTO’s top channel for driving traffic and purchases. Liftoff has become an essential partner as the company continues to grow its customer base.