DTC Brands Can Gain a Competitive Advantage Through Online Paid Media


With the economic environment reducing consumer trust and spending, brands are facing increased competition in digital advertising. Liam Wade, Director of Paid Media at Impression, highlights the strategies brands must prioritize in order to maintain or grow market share, despite challenges.

It’s a tough time to be a direct-to-consumer brand.

As the cost of living rises in the UK, concern for personal finances increases. We see the effects in GfK Consumer Confidence Index which demonstrates a continued decline in consumer confidence. At the same time, as DTC brands rely heavily on digital advertising, ongoing privacy changes are expected to make audience targeting and performance measurement difficult.

During the pandemic, many brands saw record revenue levels and invested significantly in infrastructure and facilities, as well as marketing and products to prepare for a positive trajectory.

But the proportion of online retail sales fell 26% in March 2022the lowest since February 2020. This demonstrates that while the pandemic has accelerated the shift to online sales, the halo effect is not strong enough to withstand the rising cost of living.

Unfortunately, standalone brands are competing with national retailers who have significant economies of scale to weather the storm. Despite falling consumer spending, retailers are opting to continue foreclosure levels of online revenue growth, raising ad auction costs and crowding out advertisers.

To stay competitive, DTC brands need to be proactive, data-savvy and innovative. Here are seven steps for brands to protect revenue by switching to paid advertising:

1. Prioritize the product experience

DTC brands, consider the complete marketing of your product and invest in predicting consumer buying trends.

Note that a brand’s delivery and return policy is part of the product experience. Brands will see their conversion rate increase if they are competitive here.

Google is aware of the importance, see its recent launch Google shopping experience dashboard in the USA. The program rates businesses based on their delivery and feedback, rewarding advertisers with a “ranking boost” when they receive a high score.

The customer also buys the experience with an online purchase; brands should consider investing in conversion rate optimization to improve their experience on the site.

2. Engage in automation, critically

Advertising platforms offer increasingly automated solutions – which can be detrimental. Google’s new Performance Max (PMAX) campaign type serves display and video ads that are automatically generated based on information provided by the advertiser or by Google.

Ads generated by PMAX can misrepresent a brand if not implemented appropriately – dangerous for those positioning themselves as premium brands. Auto-generated ad creatives can make a brand feel cheap and hopeless, which can be off-putting to consumers. To optimize performance, brands should create targeted creatives for PMAX and stay on top of changes as campaign types evolve.

3. Live and breathe video creations

The future of paid media management will largely depend on its ability to design, test and manage video assets. D2C brands that prioritize asset creation in their strategy will dominate slow and responsive competitors. Ad creatives should be purposefully created for the platform they are served on in order to effectively target users.

For brands aiming to target TikTok users, ad creatives should be scrollable and native to blend and stand out.

To find successful content, advertisers must continually create and test new ideas, beyond simple modifications – which may involve the use of user-generated content if the ad demonstrates the quality or use of a product.

4. Your product data is an asset

The most important asset for a product-driven strategy is product data. Feed optimization is an integral part of successful campaigns. Brands will need to ensure that their data feed is accurate, clean, and in line with guidelines set by advertising platforms. In particular, ensure that products have the correct GTINs set for better visibility against all partner retailers.

There are also significant gains to be made by improving the accuracy of answering a user’s search query – by optimizing product titles, descriptions and images. Split-test changes to these attributes across your larger catalog for best results.

5. Invest in brand ad sequencing and measurement

Previously, DTC brands could generate meaningful recognition by presenting a semi-compelling video to a large prospecting audience. But with the reduction in consumer spending, the audience is smaller and the consumers who are ready to spend are more in demand. It’s more important than ever to stand out, and ad sequencing gives brands the best opportunity for recognition.

A Ipsos/Google advertising sequencing study found that multi-touch, multi-ad awareness campaigns significantly outperformed showing users the same ad multiple times, with one methodology recording a 134% increase in purchase intent, compared.

To measure performance, brands can consider in-platform brand enhancement studies to assess recall, social listening or survey data to understand consumer sentiment and multi-cell geographic testing to understand progressive increase.

6. Owning and Using First-Party Data

For all the right reasons, privacy-related metric changes will have a huge impact on paid media performance. A key way for brands to protect themselves is to invest in first-party data collection and measurement.

Building their customer database, using micro-conversions such as mailing list signups or contest entries, and using CRM integrations to collect data efficiently will provide a wealth of data. . This can then be interpreted and uploaded to advertising platforms to create more effective advertisements. Brands should look to integrate with a customer data platform (CDP), such as Klaviyo, Segment, AudienceStream or Emarsys. CDPs combine the functionality of a CRM, analytics tools, and marketing automation to run and measure campaigns based on this data, and also offer extensive ad technology integrations.

7. Find experts and trust them

Privacy changes will lead to data reduction, and brands really need to understand the impact. They won’t always have the conclusive information they used to use to make investment decisions.

In this landscape, paid media specialists will need to be compelling and data-driven, and brands will need these experts to guide them through the challenges ahead.

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