Magazine Luiza
With or without creators? Magalu does the test to improve performance on TikTok
The Objective
How about a Pix from Lu?
Have you ever thought of receiving a Pix (Brazilian Electronic Payment System) from Lu, the digital persona of Magalu?
This is exactly the promotion that Magazine Luiza launched this year and has been publicizing on TikTok. With always-on ads in our app, the brand seeks to attract consumers to its “Magalu Pay” payment service, which gives them the chance to receive a Pix from Lu every day. The more they use, the higher the chances of winning.
But for all this to happen, first of all, the user needs to download and register in Magalu’s Super App. Along with the app engagement, these were the main goals of the brand. And while the results were good so far, the retailer wanted a way to optimize them even more. So, what to change?
The Solution
Split test with co-creation
To attract users to their app, Magalu initially bet on ads with a slightly more institutional vibe. The videos were starred by Lu, using and abusing of letterings to pass on the message clearly. But in TikTok, users value much more native content – something that the brand could explore more.
With the support from TikTok and the agencies Mirum and G3A, the retailer prepared an Split Test of creatives for August. The idea was to compare the performance of an institutional video with other co-created ones with app native content creators brought by G3A.
Videos would run as In-feed Ads at the same time, with the same broad targeting and a lower cost auction strategy to generate as much result as possible. All this with the follow-up of the TikTok Marketing Science team to evaluate the final numbers, part of a test schedule carried out in partnership with Magalu.
Since TikTok is a space where entertainment and consumption go together, the hypothesis was that videos made by content creators would perform better. After all, the platform’s native creators understand its language and thus can engage and connect more with the community. And guess which ads performed better?
The Results
Co-creation as a key to success
With the videos created along with the community, Lu's Pix campaign performance on TikTok was a success. The cost per installation (CPI) of the application in the first two weeks was 83% lower than that achieved only with institutional video. The ad click-through rate (CTR) was also 115% better. See how using native content and testing can make your TikTok campaign a great investment?
The consistent work carried out in partnership with TikTok is already bringing results. Over the past few months, we have conducted several investigations and tested relevant hypotheses about the use of the right media for the audience, achieving considerable performance optimization in CTR, CPM and CPI. Through this strategy, we observed in the last half of the year a 50% reduction in the cost per app installation in our campaigns.
The campaigns produced and co-created in partnership with creators have been a very effective way for us to connect Magalu’s goals to the most diverse audiences that use social networks. It's a way to communicate with people in a way that meets what they seek there. Advertising does not interrupt the content, as it usually happens in traditional formats, but advertising is the content itself.
