Finding new customers is hard work, especially when targeting people outside a core demographic.
The online adult retailer Adam and Eve is “always trying to get new and more avenues for new customers,” said Director of Marketing Chad Davis, who’s been with the company for more than 25 years, “always in the role of acquiring new customers.”
To that end, the brand has branched into the “sexual wellness” category, which is well-established in social marketing. Adam and Eve started working with Cognitiv, an AI performance marketing startup that creates custom algorithms for clients’ KPI needs, in spring 2020. Adam and Eve’s digital agency, Media Horizons, made the introduction and manages the partnership.
“We are not a mainstream brand,” Davis said. “So we closely look at any partner willing to work with us.”
With Cognitiv’s tech, Adam and Eve has adopted the cost-per-order metric, Davis said, as well as the percentage of new customers brought in through a media program or partner.
Throughout 2022, the brand tasked Cognitiv with finding and converting net new customers across desktop and mobile display ads. Since Adam and Eve is a direct-response marketer, “attribution of traffic to sales is very important,” Davis said. But “the display work we do is sometimes not directly attributable to the actual activity.”
Throughout the campaign, 60% of conversions came from new customers, doubling Adam and Eve’s former campaign average. These new customers also had a 13% higher average order value than existing customers.
Adam and Eve’s media mix includes podcasts, linear and streaming TV, social influencers, radio and more. Paid social is notably absent because of the brand safety restrictions on the big social platforms. “We simply cannot get cleared there,” Davis said.
At one time, Adam and Eve worked with six mar tech partners, but it has winnowed the list down to three because of audience duplication and because conversion rates didn’t keep up. “Cognitiv has been able to survive and become a significant partner,” Davis said.
Cognitiv’s pitch “has always been that AI can predict consumer behavior better than humans,” said Jana Jakovljevic, the startup’s VP of strategic partnerships.
For instance, Jakovljevic said Cognitiv’s DSP “evaluates every single ad opportunity” based on more than 1,000 data inputs, including the URL, time of day, location, historical pricing data and demographic information, using the brand’s historical conversion data to model lookalikes. The machine learning models weigh each data input for the brand and estimate the likelihood of a new customer.
“When it predicts an ad impression is going to convert, if it doesn’t,” Jakovljevic said, “it uses that information to retune and keep readjusting those weightings until it has the formula.”
Machine learning models can also identify people who are likely to make a purchase, but perhaps not immediately or in the media context of that ad. “Sometimes we know that person is going to convert, but they’re not ready,” she said. “We’ll choose not to serve an ad to them because we can predict it’s going to be another five days before they actually buy this product.”
For a direct response advertiser, finding the right customers and knowing when not to advertise to them could be the differentiator in efficiency.
Jakovljevic said Cognitiv tracks people in the “maybe” pile to see whether they eventually convert and how long it takes them to do so. Sometimes, the model will determine that someone “is never going to convert” and stops serving them ads.
Cognitiv’s pattern-matching has helped Adam and Eve identify seasonal rhythms of what works and doesn’t, Davis said. “From last October through March is a very strong time for us, as opposed to when it’s nicer outside and people are outdoors more,” he said. Sales surge during the festive season and around Valentine’s Day.
Cognitiv’s models responded quickly to changes in the online browsing behavior of new customers after the COVID-19 pandemic hit and everyone went into lockdown, Jakovljevic said. And, as people’s media consumption habits have again changed “drastically” since 2021, Davis said, Cognitiv’s tools have adapted as well.
The target audience for Adam and Eve’s products is broad: sexually active consumers aged 18–80. But the company has seen a shift in its consumer base over time toward younger and more female consumers, said Adam and Eve media manager Brian Young, who has been with the company for 20 years.
“We’re getting away from a lot of the male products that were the core of our business for a long time,” Young said. As a result, “we’re reaching out to more female audiences in our advertising.”
Adam and Eve won’t run out of new customers to prospect, Davis said. “People go through different stages in their life,” he said, “where they may be in more need or an adult toy fits better into their lifestyle now than it did before.”
