10-Year Winning Collaboration of Australia’s Largest Online Retailer of Bicycles with VIDEN

60% avg. ann. paid ads revenue growth
2X ROAS increase

Objectives

Growing market share (boosting sales) and outperforming competitors by improving digital advertising strategy (increasing efficiency of paid traffic)

Industry

Technology

About the Client

BikesOnline is a specialty retailer of road bikes, mountain bikes, parts, accessories, and clothing in Australia. The company was founded in June 2011 with the aim to make cycling more accessible by enabling Australians to buy a great range of high quality products at affordable prices. BikesOnline has operations in California, Philippines and Singapore and have won numerous awards including being featured on BRWs Fast Starters list and a finalist in the Telstra Australian Business Awards.

Challenges

The Australian bicycle market is highly competitive, with over 1,500 online bike shops across the country. Numerous global and regional players keep driving the prices and profit margins down. Achieving sales growth and outperforming competitors in such a niche has been a significant challenge.

Maintaining and improving paid traffic efficiency in a thin-margins niche has presented another substantial difficulty. High competition for keywords and ad placements drives up costs, making it hard to achieve a profitable return on ad spend (ROAS). Margin differences across various products and categories have also been adding up to the challenges, requiring tailored strategies, precise budget control, and continuous optimization to ensure profitability.

The 2014/2015 financial years marked a high point with an impressive 1.4 million bikes imported. This high was a triumph for the market but also marked the beginning of a downward trend. Imports had been steadily decreasing, hitting a low of 1.1 million bikes by the 2019/2020 financial year. Then, the industry landscape shifted in the following year. The global pandemic spurred an unexpected surge in the market, with imports soaring to a new record of 1.7 million bicycles. As COVID-19 subsided, the bicycle boom eventually busted. The market faced a significant overhang of bicycle stock. By 2023, the import quantities had plummeted to just 666,393 bikes, the lowest level since 1998.

Due to consumer behavior shifts and evolving market conditions, businesses have been facing difficulties managing the balance between supply and demand for various bicycle models and accessories, leading to inventory fluctuations.

The bicycle industry has undergone remarkable transformations over the years. Businesses must continuously adapt to stay competitive and meet their goals. Recognizing the need to navigate industry challenges effectively, BikesOnline turned to VIDEN yet in 2015.

Solution

Campaign Strategy

Rebuilding the paid search strategy to emphasize the key unique selling points
Crafting eye-catching creatives
Creating and optimizing the omni-channel media mix strategy
Utilizing data-driven bidding strategies and optimization
Categorizing and clustering products based on stock availability and margins
Product affinity analysis to cross-sell and upsell paid ad campaigns

When VIDEN started working with BikesOnline in 2015, paid advertising was rather supportive to organic acquisition and had a relatively low velocity for scale. Our team made a decision to rebuild the paid search strategy to focus on communicating the key unique selling points that set our client’s products apart, identifying areas of high-intent decision-making, and optimizing budget allocation across different steps of the consideration funnel.

Firstly, we concentrated on highlighting key unique selling points enabling our client to differentiate their brand in a crowded marketplace, simplify consumer decision-making, and enhance brand awareness and loyalty. Clear USPs resonate with the target audience and build trust by showing compelling reasons consumers choose the product or service. To succeed in emphasizing USPs, our team designed creatives that grab attention and make advertisements stand out. Effective creatives communicate a brand’s message clearly and persuasively, driving higher engagement rates and increasing sales. Google research shows that 70% of the influence on purchase intent comes from the quality of the creative content. Secondly, we focused on identifying areas where high-intent decisions were occurring. Finally, our team attended to budget allocation optimization across the various stages of the consideration funnel.

As the next step, the team applied the media mix strategy across Google, Microsoft (Bing), and Meta ads to adjust the sales funnel. By utilizing a combination of platforms, businesses can create tailored content and experiences that guide potential customers from awareness to consideration and to purchase. This strategy improves the likelihood of conversion by meeting customers where they are in the funnel.

Leveraging this approach enabled increasing awareness by targeting a qualified audience during off-hours and maximizing sales during the summer, sales events, and other peak seasons.

VIDEN employed data-driven bidding strategies and optimization techniques to maximize the return on ad spend (ROAS) across various ad platforms and tactics.

Our team leveraged product categorization (product feeds and catalog) and clustering based on stock availability and margins to control and maximize efficiency. We also conducted product affinity analysis for effective audience management to run cross-sell and upsell paid ad campaigns that increased retention and customer LTV. During the pandemic, when stock was limited, we focused on in-stock products and categories to drive sales of available inventory.

As a part of the media mix strategy, our experts implemented and optimized the omni-channel media mix across different tactics based on incrementality:

Firstly, we used top-of-funnel (TOF) tactics to build awareness and reach: Meta Ads video ads, Google Ads PMAX (shopping, non-branded search), Video (Youtube) & demand gen campaigns.
Secondly, we moved to middle-of-funnel (MOV) tactics to re-engage and build consideration: Meta display and video ads; Google search ads.
Finally, we ended with the bottom-of-funnel (BOF) tactics to convert consideration intention to purchase: Search Ads, Pmax (Shopping, Display, Responsive, etc.), Video (Youtube).

Results

Due to long-term partnerships, businesses can achieve greater results and implement more effective strategies by leveraging consistent collaboration and accountability. Look at some impressive outcome of VIDEN and BikesOnline’s successful combined efforts:

VIDEN took over the paid ads management in 2015 and already in the first year we managed to achieve an over 85% increase in sales driven by paid ads and a 24% improvement in efficiency (ROAS), contributing to overall business growth, exceeding the industry average by over 25 times.
Whereas the industry fell to pre-pandemic levels as of 2024, we managed to maintain efficiency and sales volumes that were over 2X higher than before the pandemic.
On average, paid ads revenue has grown 60% YoY, with a consistent annual improvement in ROAS of 13% YoY.

As we continue working with BikesOnline going into 2024, we embrace the challenges and opportunities presented.