Icelandair

40%

drop in cost per acquisition

21%

increase in clicks

36%

jump in CTR

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Resetting paid media for long term growth

Icelandair tasked Launch with a paid search overhaul but we couldn’t have predicted how radical the outcome would be. Our ethos is that lasting growth comes from experimentation and bravery, not clinging to old formulas.

The challenge

With 88% of spend locked into search, the airline was waiting for travellers to find them at the point of booking, missing out on crucial awareness stages of the travel shopping journey which lasts 71 days on average. By connecting deeply with their people and their business goals, and applying our four-step plan for growth, we aimed to steer them into a full funnel approach fit for the future.

Our approach

Our ethos is that lasting growth comes from experimentation and bravery, not clinging to old formulas. So we made the unorthodox move of rebalancing the funnel – not pouring budget into the same old search activity but investing heavily in Video, Display, Demand Gen and Performance Max to inspire customers earlier in their journey. At the same time, we deliberately reduced wasted search impressions, tightening coverage to focus only on the most relevant opportunities.

This dual experiment of spending more at the top of the funnel while lowering CPA at the bottom, went against industry convention and it reflected our conviction that performance marketing should fuel both efficiency and brand growth, not force a choice between the two.

The results

The results proved the gamble right. We helped Icelandair moved from a bottom funnel approach based on fragmented, inflated metrics to a full-funnel model which drives bookings today and builds demand for tomorrow. Within 12 months:

Reduced cost per acquisition

Cost per acquisition in search fell by more than 40%.

Improved click through rate

Clicks increased 21% with only 9% more budget, CTR jumped 36%, while Demand Gen clicks surged 26,983%. Performance Max unlocked 47,890 incremental clicks, and every conversion it drove was a booking.

Introducing a new audience

Video views rose 5,160%, inspiring a new audience to consider Icelandair.

The partnership with the Launch team has proved that brands can spend more at the top of the funnel and still drive down CPA. That’s why this is a new blueprint for how airlines can balance efficiency with brand growth.

Jóhann Benediktsson Digital Marketing Manager, Icelandair