OVERVIEW
Instacart took the industry by storm during the pandemic, taking advantage of expanding its reach nationally with grocery and other goods delivery. As the world normalized, so did the playing field in terms of competition and with a public offering in the future, the business executives realized that they had to expand their strategy and look to additional revenue streams. In early 2021, Instacart created an ads platform to provide another channel to expand capital and also launched Caper carts—an in store, “smart cart” that provided customers with a unique and personalized shopping experience. With early success, the program had to continue to scale and the cost of building carts became exponentially greater. In order to offset the cost and fund future scale, we turned to creating a strategy to leverage the cart platform and enable ads to bring another level of personalization and brand reach.
30 min
on average customer engagement with the screen while shopping with a Caper Cart
One of the first tactics we undertook was revisiting our research and mapping out the shopping journey so that we can pinpoint opportunities for moments where displaying ads could be a potential.
Because we knew that we were capturing an average of 30+ minutes of screen time with customers, we created a set of principles that would help us focus on intention and relevance to their shopping experience.
APPROACH
Getting ad placements right is a very tricky opportunity. We knew from prior research and industry behavioral studies that customers generally “dismiss” ads as noise, so it was critical that we were careful with extending our formats to the carts. Additionally, we knew that customers were inclined to “get in and get out” of the store, so adding any types of distractions that would prevent them from that mission would be challenging.
63%
customers surveyed told us that rich media and ads would enhance shopping
Expanding on the principles, we also focused on building out target audiences and levering insights to drive our initial hypotheses before jumping into concepts and testing. We created a user forum called “Customer Kitchen” which allowed us to enhance our understanding while amplifying our findings further.
Customers can use the power of the cart to sync their app and complementary experiences. We planned to target ads only for relevance that would be used to supplement a pre-shopping list, add savings value during in store shopping, and delight customers with unexpected savings or new brand discovery.
Make it personal.
The path to getting in store to shop takes on so many different dimensions for customers. From prior research, we knew that customers feel most anxious in store, needing to get in and get out quickly. We saw an opportunity to take advantage of the element of fun, wanting to ensure we could create a sense of adventure within the purchase experience.
Make it delightful.
At the end of the day, we knew we had to make the savings a value-add for our customers. We also need to consider what value we would bring for our advertisers so that we could ensure their ROAS and reach was also realized. Relevance would be critical and had to ensure we were using the platform to provide meaning.
Make it valuable.
THE SOLUTION
The caper screen had an existing framework that we leveraged as a starting point. We looked at our existing formats, considering static and moving elements, and started to build out our ads POV. We wanted ads on Caper Carts to take two forms: brands, deals and seasonal promotions when customers begin shopping, as well as personalized recommendations based on real-time shopping behaviors. According to our research, more than 70% of shoppers who use Caper Carts use such coupons when shopping, so we wanted to make sure we prioritized “savings” as a prominent motivator in cart.
Customers can take advantage of immediate savings on items that are added to their cart and get brand recommendations to consider as an expansion of similar formats today.
We created a new savings system. This system is present throughout the shopping journey and highlights dollar-level savings opportunities anywhere they exist.
Design for Savings
As we were designing concepts and testing, we found that customers wanted an opportunity to some times make grocery shopping an adventure, turning to “quests” in games as a reference. To test further, we created a mini-game called Quests that unlocks rewards and credits for products when shoppers complete them. Quests became custom ad formats that Instacart started selling to retailers and brands.
In one example, following and completing a treasure map of the store from the cart’s screen could trigger a flash deal to appear for a product that a shopper hasn’t previously purchased.
In one example, following and completing a treasure map of the store from the cart’s screen could trigger a flash deal to appear for a product that a shopper hasn’t previously purchased.
We also wanted to create stickiness for return visits and opportunities to link to the app, creating a loyalty bonus center that allowed customers to accrue additional savings.
Adding to our “delighter” principle, we expanded the savings platform experiences, creating a character “Max.” He was conceived with the idea that a bunny was uniquely tied to carrots and could be used as a motivator and “delighter” in helping customers save.
Introducing Max
Conceived with the combination of characteristics, mostly bugs bunny. He intends to guide customer to achieve their “maximum potential of savings.”
Max System
We expanded the design language to take advantage of max and the new systems across the platform—not just capers.
OUTCOMES
We had incredible early adoption from large brands, including Pepsi, who saw immediate results: “By tailoring advertising on Instacart’s smart Caper Carts, we can connect directly with consumers the moment they turn down an aisle, highlighting products and offers that resonate with their specific shopping preferences,” said Mike Glaser, PepsiCo’s VP of commerce.
Fidji Simo, CEO of Instacart, shared “The Caper program and our overall vision for connected stores is transforming how shopping will work in the future. What Brian has been able to do for our Ads program overall has been amazing. The ability to identify an opportunity to carry ads over to a new format has made a difference on our customer experience, utilizing a major investment for the company, and creating a new stream of revenue.”
$740m
Increase of 11% YoY in ads revenue after first year of launch attributed to Caper Ads
+10K
Increase in cart manufacturing YoY attributed to incremental revenue from Caper Ads
80
NPS score which was up from 70 YoY with call outs specifically to the Caper program