Wix Snubs TV Ads For Super Bowl LII As Consumer Behavior Changes

Super Bowl ads will always be a great platform, and Wix may one day return to making broadcast TV ad buys. Although Wix remains convinced that the Super Bowl has produced positive results, ultimately the impact and brand awareness comes from a combination of media buys.

"We can get many more impressions, find an easier way to tell the story, and gain a shorter cycle to saturation," said Wix.com CMO Omer Shai. "It's based on measurement."

Eventually it was easier to reach the audience online compared with using broadcast television, he said, underscoring that Wix.com is a data company at heart.

Wix.com, which wants to identify with consumers through a new set of celebrity icons, began running ads on broadcast television in 2012. Since allocating the budget away from broadcast TV and toward online video and other digital media buys during the second quarter of 2017, the company has hired a host of traditional and YouTube celebrities to make that connection.

A recent campaigns in the past six months featured the character Cord Hosenbeck staring Will Ferrell and another SNL alum, Molly Shannon. The two hosted Amazon's live coverage of the 2018 Rose Parade. Hosenback, the character, was signed as the newest celebrity spokesperson for Wix.

Other YouTube celebs include Rhett & Link, Karlie Kloss, Zooey Deschanel, and iJustine.

Now with more than 2000 employees worldwide, the company has spent the past few years building an in-house agency.

"We don't want to just add one campaign to replace the Super Bowl ad, where about 120 million Americans look for the ads," Shai said. "Instead we want to focus on 10 to 15 campaigns that will continue to build on our growth."

He said it's important to understand that the marketing budget continues to increase, not decrease, although the ads are not running on traditional television. So the funds spent in broadcast TV has found a home in other media buys.

During the company's 2017 third-quarter earnings call, Wix Cofounder and CEO Avishai Abrahamitold investors and analysts that Wix.com will increase research and development and marketing budgets in 2018. "There are more ways to advertise today," he said, adding that many are at least as efficient as the Super Bowl.

The company also recently added a new global product, Wix Code, to the mix of offerings as it explores new audiences and opportunities, but Reuters reported that an increase in R&D and marketing for this product caused the company to miss its profit, which Thomson Reuters forecast at 13 cents per share on revenue of $110 million.

Overall, the company claims to have gained marketing efficiencies in the latest move to bring advertising and marketing in-house and allocate funds to a variety of media. 

Here's how it works: The company makes an initial investment in marketing spend to acquire a group of users and realize the return on that marketing spend during a period of time.

For example, in the first quarter of 2014, Wix.com spent about $18 million in marketing to acquire a group of users -- about 4.5 million throughout the quarter. During 15 quarters, which ended September 30, 2017, Wix.com collected about $71 million from these users through their purchases of subscription packages, which brought in about 4.1 times the return on investment, according to company documents.

Next story loading loading..