Mercado Livre
A deep dive into Mercado Livre's journey to understand TikTok's real impact on sales
The Objective
What impact does TikTok have on sales?
Mercado Livre is truly a giant. The largest e-commerce company in Latin America is a fixture throughout Brazil—and also on TikTok. Whether it's branding actions to promote and reinforce their brand, or performance campaigns to reach people more willing to buy from their app, MeLi is always running ads on our platform.
But even though they're an expert on the subject, Mercado Livre faced a challenge to prove TikTok's value in its media strategy for the second half of 2023. After all, it's not always so simple to measure the real impact of campaigns on TikTok—even more so when the most popular click-based attribution models underestimate the impact of our app on conversions.
Mercado Livre was already accounting for this when measuring the results brought by TikTok. But how much of that result was incremental, i.e. wouldn't have happened if it hadn't been for the ads on our platform?
The Solution
Creating, creating and testing
MeLi had been on the rise on our platform since 2022. The brand has made numerous optimizations to its media strategy and, above all, has opted for communication based entirely on native ads, with content that is tailor-made for TikTok. But even though the results were rising month after month, the incrementality remained as a doubt. To solve this, our recommendation was to set up a Conversion Lift study.
Studies of this kind measure the impact of TikTok ads on conversions in a controlled test. First, the brand's target audience is separated into a test group (which sees the brand's ads as usual) and a control group (which doesn't). Then, we compare the sales volume recorded for each one.
The difference is what we call incremental conversions, which are those that wouldn't have happened if it hadn't been for the TikTok campaign—the only variable between both groups.
The idea was for Mercado Livre to have more visibility of the platform's impact on sales after all the work done over the last year. Did MeLi's optimizations and commitment to native content make a difference in sales?
The Results
More sales with TikTok!
The Conversion Lift study revealed an incremental increase in Mercado Livre sales over the period measured. This means that the number of conversions recorded in the test group, which saw the ads on TikTok, was higher than that of the control group, which didn't—and this difference could all be attributed to the brand ads delivered on our platform, which were the only variable between both groups.
The volume of incremental conversions recorded was also higher than indicated in the attribution model MeLi had been using. In other words, it was clear that it was underestimating the platform's impact on results—which happens a lot in the industry, with 79% of purchases motivated by TikTok not being identified by common attribution methods for web advertisers.(1) The brand model needed to be reviewed and adjusted.
As a result, Mercado Livre was confident that it was measuring everything correctly, and was able to get a clearer picture of the impact that the optimizations made throughout the year had on its results. And what an impact! Comparing the last quarters of 2022 and 2023, the ROAS generated by our platform increased by 2.5x.
See how important it is to understand the best way to measure results? It's crucial to see the value of TikTok views when evaluating the platform's impact on your numbers—and an incrementality study helped MeLi realize that. Ready to join us?
Plunging headlong into TikTok with a strategy designed for the app has been essential to MeLi's success over the last year. Content that resonates with the platform's unique audience has helped us reach and engage with consumers, and this has been key to the good results we've had in sales and revenue. And combining this creative approach with solid scientific analysis—in the form of a Conversion Lift study—further broadened our horizons and showed the true value of our TikTok campaigns. Not only did the platform bring in more sales, but those sales were incremental. We've already reaped many rewards from this partnership, and we look forward to continue exploring new ways to further expand our success.