How Retailers Cut Media Spend and Still Grew Sales—And What That Means for Your Commerce Platform
In Q2 2026, Five Below posted an 8-12% uplift in comparable sales while cutting traditional media spend across TV, print, and outdoor placements. The discount retailer didn't stumble into this result—investor calls and earnings announcements make clear this was a deliberate budget reallocation, not a cost-cutting experiment. Five Below redirected dollars away from low-ROI traditional channels and into owned channels like email, loyalty programs, and website content. Plus earned channels including social and influencer partnerships. The lesson for commerce platforms like PurchasePuffin: your sellers don't need bigger budgets—they need better infrastructure to make owned channels work.
The efficiency gains proved compelling: ROAS improved measurably, demonstrating that cutting traditional media doesn't demand a revenue sacrifice. Instead, it freed budget to invest where engagement and conversion rates were already higher. For commerce platform operators and B2B sellers facing 2027 budget planning pressure, this case offers a concrete proof point: the best-performing retailers are solving the efficiency problem by moving spend into channels they control—and PurchasePuffin gives you the infrastructure to do the same without rebuilding checkout, pricing rules, or partner portals from scratch.
Five Below's Q2 performance shows that reallocation isn't risky when it's grounded in channel-specific ROI data and customer behavior. The shift worked because the company measured what mattered and moved budget accordingly. PurchasePuffin builds that measurement into the platform—so you can track what drives orders, not just impressions.
Traditional Media ROI Breakdown
Five Below's audit revealed what many mid-market retailers suspect but hesitate to quantify: traditional media looks efficient in legacy attribution models but collapses under proper customer acquisition cost analysis. The company found that TV and print spending failed to drive proportional sales growth, while outdoor advertising similarly underperformed when measured against owned channels in specialty retail. These legacy media channels consistently delivered weaker returns than direct-to-consumer touchpoints, raising questions about their continued role in retail media strategy.
The attribution lag compounds the problem. Outdoor and billboard spending creates a six-month delay between placement and measurable impact, rendering Q4 performance invisible when leadership reviews quarterly results. Cost-per-acquisition via traditional media outpaces that of owned channels according to Five Below's analysis, making these placements difficult to defend during budget reviews.
This isn't about abandoning broadcast entirely—it's about data-driven reallocation. Retailers planning Q4 2026 budgets should audit the same channels now, comparing true CAC across media types rather than relying on last-touch attribution. The question isn't whether TV or print can drive awareness; it's whether that awareness converts at a cost your growth targets can support. Five Below's findings give retail leaders permission to shift away from traditional media retail by cutting underperforming traditional spend and redirect those dollars toward channels with transparent, measurable returns. PurchasePuffin's order-level analytics let you track which channels actually convert—so you're not guessing where to cut.
Customer-Centric Channel Priorities
Five Below redirected budget toward channels where attribution happens in days, not quarters. Email and SMS campaigns, powered by first-party data from the loyalty program and site behavior, delivered four to six times higher ROAS than paid social. Because these owned channels operate on data the retailer controls—purchase history, browsing patterns, loyalty tier—personalization happens at the customer level, and performance tracking is immediate. PurchasePuffin's platform handles the same first-party data layer for B2B sellers: customer segmentation, order history, and pricing tier all feed into email triggers and SMS campaigns without custom dev work.
The company also leaned into earned media, particularly influencer partnerships and user-generated content. These collaborations cost 40% less per impression than traditional sponsored media. While driving authentic engagement that converts better than top-of-funnel brand awareness plays. Affiliate programs, built on performance payouts rather than upfront media buys, added another layer of measurable ROI.
Website optimization became a priority investment. Improving product discovery, checkout flow, and mobile UX moved conversion rates without inflating media spend. Every dollar spent on site experience compounded the value of traffic already arriving through organic search, direct visits, and app engagement. PurchasePuffin's checkout builder and CMS page builder give you the tools to optimize site experience without waiting on a dev sprint—so you can test faster and reallocate budget based on what converts.
Speed matters in retail planning cycles. Owned channels like app push notifications and SMS respond to inventory shifts, promotions, and customer segments in real time. Traditional media—booked weeks in advance, measured months later—can't match that agility. Five Below's shift proves where budget performs best when attribution and customer data align. PurchasePuffin gives your sellers and partners that same agility: flexible pricing rules, real-time inventory sync, and customer segments that update with every order.
Three-Step Channel Audit Framework
The audit Five Below ran in early 2026 wasn't a complex marketing science project—it was a three-step process any retailer can execute in time for Q4 budget planning. Start by mapping what you already have: spend versus attributed revenue by channel. Using both last-touch and multi-touch attribution models. Most teams already track this in their analytics or media mix platform. The goal is to see where dollars go and what revenue each channel claims credit for. PurchasePuffin's order dashboard shows attributed revenue by source, so you can run the same audit without exporting spreadsheets.
- Step one is mapping. Pull spend versus attributed revenue by channel, using both last-touch and multi-touch attribution models. Most teams already track this in their analytics or media mix platform. The goal is to see where dollars go and what revenue each channel claims credit for.
- Step two is calculation. Pull six months of clean data and calculate true customer acquisition cost and ROAS for each channel. Don't rely on platform-reported metrics alone—build a simple spreadsheet that divides total channel spend by new customers acquired, then compares that CAC to the revenue those customers generated. This reveals which channels look efficient in isolation but collapse under scrutiny.
- Step three is testing. Identify your bottom-quartile channels—the ones with the lowest ROAS—and run a controlled holdout test. Five Below ran a six-week holdout test on TV spend in three markets, cutting budget by half and monitoring sales impact. The result: minimal sales change, proof that the spend wasn't driving incremental growth. Document your holdout results with before-and-after data, market controls, and revenue trends. That documentation becomes the evidence you need to justify reallocation to executives and finance teams during annual planning.
Implementation Timeline for Q4 2026
Most retail teams treat budget reallocation like a 2027 project. But the actual planning cycle gives you the next five months to audit, test, and lock in new allocations before year-end budget meetings. If Five Below could execute their shift in time to post Q2 results, your team can do the same.
- September 2026: Complete your channel audit and identify reallocation targets. Map spend against attributed revenue for the past six months and calculate true CAC for each channel. Mark the bottom quartile for testing.
- October 2026: Run four-week holdout tests on low-ROI channels before Black Friday ramps up. Pull budget from underperforming TV or print and measure whether sales hold. Document the results.
- November 2026: Lock in your 2027 budget with reallocated dollars. Use Q4 test data as proof for stakeholders. Shift freed-up budget toward owned and earned channels.
- December 2026: Monitor Q4 performance to refine your owned and earned channel mix heading into 2027. Adjust email cadence, influencer partnerships, and loyalty incentives based on what converted.
Building Internal Buy-In and Measurement
The board meeting where you propose cutting TV or print will surface resistance—especially if legacy vendor relationships or executive comfort with traditional media persist. Five Below addressed CFO hesitation by running a six-week TV holdout test that measured comparable-store sales lift. Not just marketing metrics. The data proved that pausing traditional spend didn't hurt revenue, giving leadership confidence to reallocate.
Attribution transparency matters. Five Below demonstrated incremental sales ownership through first-party data tracking: email, SMS, and app engagement tied directly to basket growth. Present your own channel dashboards with real-time ROAS by channel, updated weekly. This visibility turns budget defense from opinion into evidence. PurchasePuffin's analytics dashboard gives you that same transparency: see which email campaigns, partner portals, or SMS triggers drove orders—not just clicks.
Frame reallocation as phased, not sudden. Test underperforming channels in Q4 2026, document results, then commit budget in 2027 planning. Holdout tests de-risk the shift and provide the ammunition you need for stakeholder conversations. PurchasePuffin's flexible infrastructure lets you test new pricing tiers, loyalty incentives, or partner promotions without custom dev—so you can run holdout tests faster and prove ROI before you commit budget.
