The retail industry is still taking its time exploring new opportunities for locally-targeted marketing, but the travel industry has jumped all the way in and become a leader in the space. For Hopper, a mobile app for flight and hotel booking, that means running more than 500 customized campaigns each day, tempting travelers with limited-time deals from their current locations.
In March, Hopper spent 50% of its marketing budget running locally-targeted flight deal campaigns through Smartly.io, an ad optimization startup. Most of those ads appeared on Instagram Stories, although geotargeted Hopper ads also appeared on Facebook and Instagram feeds.
“Our ads show the users deals leaving from their home airport,” explains Simon Lejeune, head of user acquisition at Hopper. “If you live in Boston, you’ll see ads showing great prices from BOS to Hawaii, Paris, Tokyo, or Lisbon.”
Lejeune says that Hopper relies on its own airfare database to detect the best airline promotions to run in real-time.
For its geotargeted campaigns, Hopper relies on Smartly.io’s ability to ingest, for example, 1,000 flight deals and generate campaigns with 3,000 ad sets and 9,000 ads, breaking out audiences into different segments and testing creatives across ad sets. Hopper includes the latitude and longitude of the home airport of a deal, and a hosted illustration of the destination, and Smartly.io uses that data to automatically create the different audiences and creatives.
Hopper customizes the origin of each flight based on the user’s location, relying on custom copy that mentions the user’s city. (For example, “Fly from Boston to Tokyo!”) But Lejeune says that alone is not enough to stand out in today’s hyper-competitive market. He says the “real and interesting challenge” lies in predicting which deal is going to perform best, based on the origin and also based on the interests and behavior of the audience.
After Hopper launches a campaign, Smartly.io begins automatically reallocating the budget towards the best-performing deals based on early click-through-rates or engagement data.
“We’re spending millions of dollars on Facebook and have a lot of ads engagement data to figure that out,” Lejeune says.
Hopper’s relationship with Smartly.io started with a recommendation from the company’s Facebook rep. Although Lejeune says Hopper had initially planned to work with Smartly.io on a limited basis, until the company could build its own scripts to automate the creatives and generation of ad sets, complexities in Facebook’s API made that difficult, if not impossible. Today, Hopper uses an API it built internally to work with ad partners like Facebook, Snapchat, Twitter, and Google, with Smartly.io making the connection to the Facebook Marketing API.
“It made more sense to put our automation efforts on other parts of our user acquisition operation—reporting, cross channel optimization, Snapchat, Twitter, etc.—and let Smartly.io do the work on the Facebook side of things,” Lejeune says.
Location and travel are inherently tied together, but Lejeune says Hopper’s interest in location-targeted advertising goes beyond that. Geotargeted campaigns add value to users, he says, in a way that non-targeted ads do not.
Having tested tons of ads, Hopper has discovered that geotargeted deals have the best interaction rates at the ad level, and they have better post-install engagement rates, as well. Better CTRs make the networks happy, lower Hopper’s CPMs, and get the company more users for the same budget, Lejeune explains.
“If Hopper interrupts you while you’re frantically tapping and swiping through Instagram or Snapchat stories, we want to make it as relevant and informative as possible,” he says. “A simple flight deal from your airport that you can eyeball in a second does that job well enough.”
Promoting a mobile app comes with its own set of unique challenges. But Lejeune says ads that promote the product an app is selling work better than ads selling the app or its features, no matter how cool the technology behind-the-scenes may be.
“No user actually cares that Hopper ingests 10 to 15 billion flight prices per day and created an algorithm that can predict future flights prices with 95% accuracy,” Lejeune says. “What they care about is getting a sweet deal on that flight to Italy. And that’s what we try to promise potential users to get them to try Hopper.”
Stephanie Miles is a senior editor at Street Fight.