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Instacart Launches Target ROAS and New Acquisition Objective

Instacart

Instacart

Apr 16, 2024

New functionality brings increased control and efficiencies to reach new audiences 

At Instacart, we use an objective-based framework to organize our ad formats for advertisers creating new ad campaigns. Because our different ad formats are each better suited for different consumer behavior or consumers at different stages of their buying journey, organizing them so that they’re aligned to the different objectives advertisers want to achieve streamlines the setup. 

We recently launched a new objective, Acquire, to provide advertisers with an option to run ad campaigns optimized for reaching new-to-brand (NTB) customers. With this objective, advertisers can create and fund ad campaigns that attempt to reach consumers who have not bought their brand on Instacart within the last 26 weeks.

When Honey Stinger ran an ad campaign optimized for NTB customers, of the campaign’s attributed sales, 65% were NTB customers, showing how effective the new option can be.* 

“Since Instacart started providing new-to-brand metrics, we’ve kept a close eye on them – and have seen a steady up-tick as we continue to grow our brand awareness,” said Wendy Mayo, VP of Marketing, Honey Stinger. “As we promote trial on our waffles, we will continue to invest in Instacart’s technology to prioritize new customers adding Honey Stinger to their carts. ”

There are several reasons why you might want to emphasize attracting NTB customers with an ad campaign. An emerging brand might be focused first and foremost on acquiring new customers to grow their brand presence. An established brand with a loyal customer base might want to focus on NTB consumers as a more impactful use of their ad dollars. 

Bringing in NTB customers drives long-term sales growth if they convert to repeat customers. So beyond just the initial sale, the value of sales to NTB customers is that opportunity — and thanks to the buy it again lists and other product suggestions displayed to consumers on Instacart that are influenced by purchase history, once you have acquired a NTB customer on Instacart you have a better chance of being seen during future shops.

New options, increased control for optimized bidding ad campaigns

While the new Acquire objective provides increased control over which auctions you have a greater chance of winning, by optimizing for NTB customers, we’ve also improved the control advertisers have over the optimized bids their campaigns make to win placements by introducing target return on ad spend (ROAS). 

Both of these advancements apply only to optimized bidding campaigns — ad campaigns that leverage our internal machine learning algorithm to automatically set optimal bids for each unique auction.

Optimized bidding campaigns provide several benefits. Rather than setting manual CPC bids, monitoring performance, and then adjusting, optimized bidding sets bids for your ads and dynamically adjusts them throughout the day, taking into account many factors to generate the largest-possible expected sales revenue your budget can afford. 

Optimized bidding campaigns eliminate the need for manual bid adjustments, driving efficiencies, but perhaps more importantly, tests have shown that these campaigns perform better than manual bidding campaigns. 

Now with target ROAS, our advertisers can be more explicit about their ROAS goal — defining in this setting the ROAS they want their optimized bidding to achieve. Target ROAS provides more predictable campaign performance by optimizing bids to hit the ROAS target. This replaces the previous ‘minimum ROAS’ setting which did not always return the desired result because the platform favored lower bids to participate in the maximum number of auctions. 

Taken together, these new features put more control into the hands of our brand partners so they can achieve more predictable results. Both the new Acquire objective and target ROAS represent our continued investment in solutions that drive results for the brands that partner with us. 

*Prior results do not guarantee future outcomes.

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Instacart

Instacart

Instacart is the leading grocery technology company in North America, partnering with more than 1,400 national, regional, and local retail banners to deliver from more than 80,000 stores across more than 14,000 cities in North America. To read more Instacart posts, you can browse the company blog or search by keyword using the search bar at the top of the page.

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