Summary

Babbel is one of the best language-learning apps on the market. Babbel's interactive lessons are designed by real language teachers, not just machine learning algorithms, and offer learners cultural context and practical, real-life words and phrases. With various learning methods available, including podcasts, games, videos, and live classes with native-speaking teachers, Babbel makes language learning fun and engaging.

Since November 2019, Babbel's Influencer User acquisition (UA) campaign has been expertly managed by TATAM, with consistent results and a focus on aligning the Customer Acquisition Cost (CAC) goals and strategies. However, as the US market's economic context and the Influencer marketing industry became increasingly challenging in 2022, TATAM took the initiative to shift the campaign's focus completely. Throughout 2022, Babbel slowly shifted its campaign's focus toward setting a Return on investment (ROI) goal as the main key performance indicator (KPI) after 26 months of looking at the CAC only.

With a new goal, an increased budget, and a challenging context, in 2022, TATAM did numerous performance analyses, ran several tests, and applied new strategies, managing to not only scale the campaign's spend 60% compared to the previous year, but also deliver results that exceeded the ROI targets.

Thanks to TATAM's innovative approach and dedication to success, Babbel's Influencer UA campaign continues to thrive in the ever-changing marketing world.

Objectives & Goals

Babbel came to TATAM Digital, an award-winning Lower-Funnel Influencer Marketing Agency, in early 2020 with a clear challenge: to bring in new U.S. subscribers through an always-on influencer campaign. Over 30 months of working together, the influencer marketing channel grew and became the top-performing user acquisition channel for Babbel in terms of CAC.

During the first two years, the campaign's primary goal was to achieve a low CAC in the U.S. market, tracking U.S. subscribers with an ever-increasing budget. In 2022, we were eager to continue with the already-working campaign and scale the efforts, with monthly budgets increasing between 33%-67%.

However, the year presented a significant challenge this year: the oversaturation of the Influencer Marketing industry and the economic context in the U.S. Despite the setback. We continued working towards achieving our goals. We quickly realized that the sales volume started dropping and would continue to do so, compromising our good performance.

We had to start being more conservative with our influencer portfolio, which prevented us from scaling the campaign's budget. The team started looking for ways to increase sales volume while keeping costs low. We realized we needed more information that could help strengthen our strategy. The only way to move forward was to change how we looked at things regarding performance.

After bringing this forward, Babbel shared insights into incoming revenues and their benchmark Return on Investment (ROI) for other UA channels. From then on, we shifted the campaign's focus completely, switching from a cost-based strategy (CAC) to a profit-based strategy (ROI).

First, we decided on setting a monthly ROI "by date" as our new target starting in April 2022. This goal considered all the proceeds brought by the influencers booked within that month. Then, we analyzed the results by the total incoming revenues to set a different goal as an acquisition channel. This goal was a monthly X% ROI "by revenues," which considered all the proceeds brought in a month but coming from any influencer booked in the past.

Through our long-term partnership with Babbel, several data analysis, and the development of new strategies, we scaled the campaign to over 61% more annual spending than in 2021, breaking absolute records with our performance!

Planning

In early 2022, Babbel aimed to increase its monthly budget by 25% for its influencer marketing campaign while maintaining the desired customer acquisition cost (CAC). The company experimented with younger audiences in February and March, committing to the budget spend and attempting to drive them towards the 3-month subscription plan. Unfortunately, the test was unsuccessful in driving a significant sales volume, and the trend of increasing CAC continued due to the economic context of the market. Additionally, with more brands entering influencer marketing, capturing audiences' attention and maintaining a healthy Click-through rate (CTR) became challenging. Despite these difficulties, Babbel maintained positivity and enthusiasm to find solutions.

By April, Babbel measured revenues and return on investment (ROI) using its designated tracking tool for the first time. The company found that its average ROI was considerably lower than other acquisition channels. Babbel aimed for a monthly ROI goal, standing 10 points higher than its annual average without compromising the CAC.

Babbel introduced the Lifetime subscription in May, its most expensive plan yet. After testing it with influencers, the company found that although sales volume had slightly decreased, ROI had significantly increased. Babbel kept the Lifetime subscription on all landing pages and began tracking a new key performance indicator (KPI): Cash Actual Revenue per Initial Sale (CARIS), the monthly average of money subscribers paid for their initial order.

By the third quarter, Babbel analyzed the campaign's performance using several KPIs, including CAC, ROI, CARIS, and funnel. The team discovered that small and nano deals had a high ROI but lower sales volume, while medium and large values had weaker performance in terms of CAC and ROI. CARIS varied depending on the deal, but higher CARIS was also important. This information allowed Babbel to redefine its top performers and identify trends in performance for different deal sizes.

Finally, Babbel added another analysis to measure its performance, focusing on the fact that YouTube is its main platform and has a powerful long-tail effect on incoming sales months after the posted video. Babbel measured ROI by total incoming revenues in a month. Regardless of which influencer was within the campaign and ROI by the report, revenues from the influencers booked within the month were reported. The company's "ROI by date" goal was 10 points higher than its average ROI when it first started measuring it, and its goal for "ROI by sales" was 20 points higher.

With these insights, Babbel reevaluated its campaign focus and strategies to achieve its new ROI goals while continuing to scale up its budget and sales volume. Despite the challenges, the TATAM team remained confident that Babbel could reach its goals with hard work, determination, and innovation.

Execution

At TATAM, we helped our client Babbel maximize their investment in influencer campaigns by implementing new strategies and performance indicators. By adding ROI and CARIS to our visibility on the campaign's performance, we focused on increasing sales volume while maintaining higher CARIS and ROI through developing new strategies.

One of the first things we did was leverage the power of the Lifetime subscription by making it a requirement in our influencers' briefs. This resulted in a boost to our overall revenue and increased CARIS.

We also gave influencers time to expand their knowledge in the language they were learning through the app and share their progress with their viewers, driving users towards high-cost subscription plans.

To increase engagement and CTR, we created a QR test that added a QR code to the screen during our influencers' integrations, leading viewers to Babbel's influencer landing page. This resulted in a 17% uplift in clicks for tested influencers.

We established long-term partnerships with those with healthy CAC, on-target ROI, and a high sales volume. Doing so, we secured almost six monthly budget figures in long-term partnerships and a solid sales volume without compromising CAC.

To fight ongoing inflation, we introduced multi-time deals for new influencers. By booking them in for two rounds of integrations from the outset, we could freeze their fees and cancel their second spot if their performance wasn't up to scratch.

We worked as a team with full transparency on the campaign's performance and results. The Business Intelligence team at TATAM built an analytics tool called the "Campaign HQ" for Babbel, which allowed us to quickly review the performance of the influencer campaign in real-time and make faster decisions.

Take a look at it below:

*Real values have been removed.

All in all, our campaign for Babbel was a resounding success. By analyzing data, developing new strategies, leveraging technology, and working closely with influencers, to increase sales volume pain and being an A-level UA channel for Babbel.

Results

2022 was a year of growth and success for TATAM, and we couldn't be more thrilled with what we accomplished, even with the sales volume challenges we faced, both externally and internally. The industry was expanding rapidly, and we knew we had to create a new strategy to stay ahead of the game.

Our performance-based and results-driven agency worked tirelessly to develop a fresh approach to our Babbel campaign, using brand-new analysis to completely shift the campaign's focus. Our efforts paid off as we achieved and exceeded our 2022 goals.

Thanks to our long-term and multi-time deal strategies, we scaled up our budget by an impressive 60% from the previous year. By featuring the Lifetime subscription on all ads, we improved our CARIS, which more than doubled from Q1 to Q4, reaching peaks of up to three figures in some months. Our hard work and dedication paid off as we spent over seven figures of our annual budget in 2022, bringing in a significant number of US-only subscribers and generating six-figure revenues.

To top it all off, we surpassed our ROI by sales goal by one point, initially set 20 points higher than our average ROI at the beginning of the year. We maintained our usual three-figure CAC while achieving impressive results, a testament to our team's efficiency and hard work.

Our success in 2022 was a true team effort, and we are proud of what we accomplished despite the challenges we faced. We are excited to see what the future holds for TATAM and Babbel as we continue to grow and achieve even greater heights together. Overall campaign results:

• Babbel x TATAM has been running for 40 months and is an ongoing campaign.

• Over 1,339 sponsorships went live all time and 611 during 2022 to date.

• In 2022, 303 one-time deals went live, 272 long-term, and 36 new multi-times.

• 118M video views and 55M from 2022 to date.

• Four figures of US-only subscribers and six figures worth of revenues in 2022 alone.

• Surpassing our ROI by sales goal by 1 point and maintaining our three-figure annual CAC.

• Babbel’s campaign also planted 611 trees with the TATAM Reforestation Project in 2022.

TATAM partnered with the Eden Projects and started the TATAM Reforestation Program in January 2022, planting 1 tree every time 1 one of our videos goes live.