Performance Marketing & Analytics PicMonkey reduces CAC by 10% and increases LTV by 60% in less than 5 months after PPC overhaul
Summary
PicMonkey worked with Jarrah Growth Marketing to transform its PPC function into an efficient operation. The company, which offers a popular photo editing tool, wanted to bring their Customer Acquisition Cost (CAC) under control and increase ROI. Before engaging Jarrah, PicMonkey had worked with another agency whose strategy resulted in high CAC and poor quality conversions, leading to lower ROI.
After working with Jarrah, PicMonkey cut their CAC by 10% and doubled Customer Lifetime Value (LTV) in less than 4 months. Thanks to this initial win as well as our ongoing strategic management, we've worked with PicMonkey for the past three years and were retained when Shutterstock acquired the company.
About the Case
PicMonkey, a graphic design and photo editing tool with 20 million users worldwide, wanted to improve its PPC numbers. The priority was increasing the quality of customers while bringing CAC down, and to accomplish this, they needed to overhaul their existing approach to PPC.
Problem + Goal
Why PicMonkey contacted us
PicMonkey's previous agency was focused on Target CPA bidding, an automated bidding strategy. The agency had spread PicMonkey's budget wide under strict CPA caps, with the hypothesis that so long as the spend stayed below the CPA caps, their approach would support PicMonkey's goals. On the contrary, because this approach didn't take ROAS and LTV into account, it didn't differentiate between acquiring low value customers versus customers worth 20x the average LTV.
Moreover, organic blog landing pages and long-tail research keywords with low conversion rates were eating up to 30 percent of the company's monthly budget. PicMonkey's goal was to increase LTV while decreasing CAC. They needed a PPC partner that could undo the work of their previous agency and lay a new foundation while continuing their ongoing campaigns.
Services
Summary
The Jarrah team initiated a comprehensive ad account audit to understand PicMonkey's current state. Our priority was changing the focus of PicMonkey's current PPC strategy. Our paid advertising specialists moved PicMonkey towards a tROAS bidding model, which uses AI to predict the value of a potential conversion, making it easier to predict customer LTV. This supported the bespoke Predicted LTV model Jarrah applied for PicMonkey.
We also leveraged PicMonkey's BigQuery setup to create a Predicted LTV and pass that back to the company's ad platforms for optimization. We also identified inherited ad account goals that were not tied to deeper business performance. For instance, there were tens of thousands of registrations with very low conversions into subscribers. By aligning bidding, optimization, and spend allocation to high conversion intent keywords, we were able to pay immediate dividends for performance.
Paid Media Management
Analytics
Conversion Rate Optimization
Attribution + Prediction
Outcomes
The PicMonkey and Jarrah partnership was a success. The PPC overhaul reduced CAC by 10% and doubled LTV in 4 months, going from over $400K in January to nearly $800K by April. We also conducted several landing page experiments which improved conversion rates up to 30% and generated an additional $142,000 in incremental ARR.
Jarrah brought a level of analytical rigour and partnership that set them apart. Their team went above and beyond to help us scale efficiently and improve acquisition performance. They're one of the most data-driven partners I've had the opportunity to work alongside.
Jenn Reiner
Senior Director Product Marketing, PicMonkey
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