Turo is a car sharing marketplace where travelers can book any car they want, wherever they want it, from a community of local car owners. Travelers choose from a unique selection of nearby cars, while car owners earn extra money and help fuel the adventures of travelers they meet along the way. Since its national launch in March 2012, Turo has built a vibrant community of over 2 million owners and travelers. Turo is changing the way people think about travel in 2100+ cities and 300+ airports throughout the United States.
Since day one, Turo has made every effort to approach their marketing spend as scientifically as possible. They measure marketing ROI as the ratio between customer lifetime value (CLV) and the customer acquisition cost (CAC), which they consider to be the most holistic way of understanding the unit economics for marketing.
When CLV (i.e., future gross profit per user) is compared to how much is spent on each user, you can better predict profit that can be reinvested in the company while streamlining acquisition costs.
Turo had always lived by the CLV:CAC metric, but they could only do it at a very high level. In one spreadsheet, the team calculated average revenue per user (ARPU) and used that to forecast CLV, and, in another spreadsheet, calculated customer acquisition cost (CAC) to try to get a global understanding of marketing ROI.
As Turo grew, the marketing team wanted to do these calculations and comparisons to better determine the ROI of each marketing channel. Then the ROI of each marketing campaign. Then the ROI of each marketing keyword and creative asset. And rather than looking at it historically, they wanted it to be predictive given the rapid growth of their business.
Achieving this level of granular insight would help get them smarter about ROI across dimensions and maximize their marketing dollars, but it would also fate them for death by spreadsheets. Continuing to segment each channel by all of their different dimensions would’ve resulted in thousands of spreadsheets. As the marketing team strived toward great sophistication, it became apparent that the system didn’t work.
Turo adopted Custora’s predictive CLV analytics to automate their calculations and gain greater accuracy in modeling.
Now they use Custora to quickly and easily see the ROI of every single customer, which can be investigated at whatever level of granularity they want, like by channel, campaign, or keyword. This helps them make better decisions about how to balance marketing spend across the department’s efforts.
Turo now feeds Custora more than 50 variables, and because of Custora’s machine-learning foundation, the analytics gain in sophistication and the system gets smarter with every upload.
“We've built a whole data pipeline around Custora. Custora is the brain that powers our marketing analytics stack. We feed the data into dashboards that help us keep a pulse on our marketing performance, and we’ve even started to build automated bidders that use the CLV data from Custora. There's an entire ecosystem powered by Custora's CLV engine,” said Turo CMO, Andrew Mok.
We've built a whole data pipeline around Custora. Custora is the brain that powers our marketing analytics stack. We feed the data into dashboards that help us keep a pulse on our marketing performance, and we’ve even started to build automated bidders that use the CLV data from Custora. There's an entire ecosystem powered by Custora's CLV engine.
“We use Custora to look at the ROI of essentially every single customer, which we can then roll up into whatever level of granularity that we want, like by marketing campaign, channel, or keyword, and we can make much smarter decisions about how to balance our marketing spend across those dimensions,” said Andrew Mok.
Custora allows Turo to focus on acquiring higher-value customers for less while keeping an eye on where to down-bid on efforts that attract low-value customers. Now, Turo puts a CLV target to every channel, campaign, and even down to specific keywords.
This attention to detail has helped Turo improve their marketing ROI by roughly 300% since adopting Custora, which was critical in their gains. Between 2014 and 2018, Turo increased their annualized gross revenue by over 25x, and they continue to grow rapidly and more importantly, efficiently.