Brands are no longer investing in cheap social media ads

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Brands are no longer investing in cheap social media ads

DTC brands are shifting away from relying solely on social media ads due to rising costs and diminishing effectiveness. 

Brands like Luca Faloni are investing in offline advertising, such as tram wraps and taxi branding, to enhance brand credibility and reach new consumers.

Brands now recognize the need to engage customers across various touchpoints. Multichannel campaigns, combining social media, events, and other platforms, are proving more effective in attracting and retaining customers. For instance, Dermalogica is increasing its investment in multichannel campaigns to over 60% of its marketing budget.

With social media's diminishing dominance, brands are increasingly turning to search advertising, particularly on Google, where costs are lower and intent to buy is higher. Luca Faloni and Therabody are reallocating their digital advertising budgets towards search, capitalizing on lower customer acquisition costs compared to social media.

In general, these shifts reflect a broader trend towards a more diversified marketing approach, emphasizing engagement, targeted advertising, and adaptability in response to evolving consumer behaviors and technological changes.

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How DTC brands with lower budgets are reducing R&D costs 

Cash-strapped DTC brands are redefining their Research & Development (R&D) approaches, shifting from costly agencies to direct collaborations with overseas manufacturers. This includes sourcing materials creatively and leveraging manufacturer-provided design services, cutting costs significantly.

Working directly with manufacturers offers advantages beyond cost reduction, such as quicker turnaround times and streamlined communication. Some agencies are adapting by offering deferred payments and simpler design options to accommodate budget-conscious brands.

Newer brands are pioneering cost-effective R&D from the outset, exemplified by Serena Advani's resourcefulness in sourcing eco-friendly packaging for Seadrop Skincare. While this approach demands adaptability and operational complexities, it signifies a shift towards lean, inventive product development in the DTC landscape.

Tiger Woods’ DTC brand, Sun Day Red, debuts with a purely digital marketing approach

Tiger Woods’ new DTC brand, Sun Day Red, sold its first items today without much promotion beyond digital marketing and the considerable branding power of the golfing legend himself.

The new clothing line succeeds the one Woods developed with Nike over the course of a 27-year partnership that came to an end early this year.

Scott Frost, head of marketing for Sun Day Red, said the brand has done very little paid advertising in launching the brand, relying instead on big opportunities for earned media like Woods’ appearances on the “Tonight” and “Today” shows this week and on building a digital audience.

Sun Day Red has about 400,000 social followers, three-quarters of them on Instagram—where they see lots of photos and videos of Woods, and plenty of well-shot product teasers.

Frost called the brand’s approach to digital marketing “very progressive,” yet “pretty traditional” from an earned media perspective. Frost also said he could envision a more traditional advertising approach and athlete spokespeople beyond Woods further down the road, but said “I think we’ll always live digital.”

Emma Chamberlain fans get their content kick via Chamberlain Coffee

You may be surprised to hear that Emma Chamberlain, one of the world’s most famous YouTube vloggers, isn’t on TikTok. In a way, it's a genius move. 

The YouTuber blew up in the late 2010s/early 2020s through her curated but ever-so-relatable YouTube vlogs. The choice to not be on TikTok means that her fans have one place to go - YouTube - and therefore will almost always go and watch her vlogs on her main income platform. 

This aids Chamberlain’s DTC coffee brand, Chamberlain Coffee, in that when she posts UGC-style content showcasing her product on the brand account, her fans feel like they’re getting their short-form-content fix of Emma. 

In a TikTok posted two weeks ago to the coffee account, Emma attempts to make an almond cake tasting cold brew from her own DTC brand products. Most of the top comments read “the way I smile like this is a new vlog” and “I feel like I’m watching a vlog” as well as “I’m definitely buying this!” 

The moral of the story? Give consumers what they want and once they’re hooked, feed it into the marketing plan sparingly.

That’s a wrap!

We’ll see you again next Monday 👋