If you couldn’t join us  for our 2024 Reload Summit last September, here's what you missed from our session featuring our very own Claire Bowes, Senior Director at Visualsoft, Connor Weir, Community Manager at HMV, and  John Cave, Co-Founder and Director at Shoptimised, asking the universal question for any business: did I really need to spend all that budget? Let’s jump in…

Claire: Connor, how does HMV view and manage advertising spend?

Connor: For us, wasted spend is any spend where we’re not in control. It’s when money is being spent, but we aren’t keeping a close eye on the results or adjusting accordingly. A good example is our prize draws and competitions. There’s only so much interest before you’ve tapped out your audience, and at that point, the cost of acquiring new entries skyrockets. If you’re not closely monitoring KPIs, it’s easy to lose money without gaining meaningful results. Also, the finance team can take your budget away from you if you don't spend it, which I find out the hard way,

Claire: John, let’s talk about paid media and conversions. Is all spend that doesn’t lead to immediate conversions really wasted?

John: It’s not always as black and white as wasted spend. In PPC or Google Shopping, it’s common to get an audit saying your wasted ad spend is huge. But, we recently analysed over £150 million of what appeared to be wasted over 12 months, and about 37% was spent on products that got only 1 to 5 clicks, which isn’t enough to drive conversion. So the way we try and look at wasted spend is, how many clicks does it take, on average to convert, and what are you spending on products that get clicks which gives you a much better idea of where you need to try and optimize what you need to cut back on. 

"And I think you definitely need to have an attitude towards almost a burn budget, what are you prepared to spend that isn't going to give you a return? So you can learn what you need to invest in in other areas as well."

Claire: That’s reassuring for many here. "Burn budget" is a term I love! Connor, how does HMV approach spending across different media channels?

Connor: HMV has had an interesting journey. After going bust twice, when I joined, the company had to re-evaluate everything. We started from scratch, working with Visualsoft on affiliates to prove what works. Our approach has been step-by-step, making sure every penny spent delivers value. 

Claire: And when deciding where to allocate the budget, what’s the deciding factor?

Connor: It’s a mix of performance and targets. One challenge for us is that there’s no singular HMV customer. We have multiple distinct customer groups, and we tailor our spend across different networks and audiences based on where we’ll get the best response. For instance, vinyl customers and toy collectors behave differently, so our marketing has to reflect that. It’s all about understanding who’s on which platform and meeting them there.

Claire: John, from ShopTimised perspective, how should retailers allocate their paid media budgets?

John: For us, it’s about being agnostic. Most of our retailers focus heavily on Google Shopping, but as you scale up, you face diminishing returns if you rely too heavily on one channel.

"Growth comes from diversifying—Google Shopping might be the go-to, but you should also look at social media, affiliates, and more. I think there's always a risk as well. If you're overly reliant on one channel, if that channel has a problem, then you have a bigger problem at that point. So, it’s essential to invest across multiple channels to drive sustainable growth."

Claire: Completely agree—diversification is key. Connor, how do you view the balance between channels at HMV?

Connor: We treat each channel as part of a holistic strategy. For instance, affiliates bring in high-quality customers, but there aren’t enough of them to scale alone. Google and PPC handle the heavy lifting, but social media, particularly on platforms like Instagram and TikTok, is crucial for upper-funnel activities that build brand awareness. Each channel has its role, and we’re constantly evaluating performance to adapt our strategy.

Claire: How do we effectively spend across all three of the paid channels, so affiliates, paid search and social? Where do you actually see the greatest return for HMV?

Connor: We define different goals that we're going after, and then we work backwards from there. So for example, It's not just a case of bringing in one kind of new customer. It's trying to bring in a whole bunch. So we try and spend across the different networks in ways that work for the audience. And we will go after particular audiences, say, vinyl customer or a toy collectible customer. They'll be on different networks, in different amounts, and they'll want to be shown different things. Right now we’re working with Shoptimised to make our imagery work a lot harder. 

Claire: John, what different tactics per channel do you  put in place to increase efficiency? 

John: One of the things we’ve implemented at ShopTimised is bringing performance data directly into the platform to optimize product feeds. We linked our platform to the Google Ads API to allow people to create performance rules using customer labels in the platform. So what a lot of people do with shop to buyers now is they bring that performance data into their product feed, and using that performance data, they can then decide what products they should send a Google shop, By analyzing how products perform, we can decide where to allocate budget more effectively—whether to push a product in Google Shopping or through affiliates, for example. It's about smart data-driven decisions. We have a parent product feed. That parent product feeds  performance data, and that decides which products get syndicated to which product feeds after that, to go into the correct channels. I think by doing that, we've seen more data driven lineup project design where products are going to go, but being able to see more sets of returns and help to kind of cut down some of that wasted spending on different channels.

Claire: Now, for a fun final question to wrap this up—if there were a silver bullet for paid performance success, what would it be?

Connor: So all of our stores have their social media accounts. If you have 20 minutes, I suggest you look up HMV Norwich, they do really, really cool TikToks. We leverage this content across our other platforms including paid social. People relate to it because it feels authentic. 

"I would suggest get your face in it, being the kind of person that your customers want to shop with, and then that's what will give them that little bit more attention to actually shop with you."

John:  So silver bullet, I think the things for me, especially coming into quarter four, I'll go through and clean everything in my merchant centre for both Google, Bing and Facebook catalogs, and make sure that I have that as clean and optimised as I possibly can. Search terms will come in. People will get more concentrated around discounts and sales and promotional goals become an important aspect of that.

"Another big thing, in product feeds, is custom labels. I think custom labels really give you the opportunity to be as creative as you possibly want. And quite often, when I look at product feeds on the platform, there is at least one, if not all, custom labels are empty and completely blank."

I'll always advocate that you should be using custom labels to get some level of data in there, whether that is you assigning what this type of product might be, creating, a price band, a margin, putting your cost of goods sold data into that. Once you've utilised custom labels, and you're pushing them through your feed and into Google ads, they'll start recording data.They become really good reference points for optimising, it's reference points that you wouldn't have had in other ways, and

"It allows you to optimize and build campaigns differently. It's where the innovation side comes into Google Shopping that allows you to build strategies that are really unique to your business, not just work within the limitations of what Google try to set for us."

There’s certainly plenty to digest and take on board, but if you’re after even more from 2024’s Reload Summit check out roundup summaries for TikTok, Google, Klaviyo and Shopify, all available right here.