While diversifying campaigns across channels and adding new channels to the mix broaden marketers’ reach, they also add complexity to campaign design and execution. Marketing automation platforms can help streamline the underlying tasks and workflows that create this complexity. You can also identify, track, and engage individual buyers; prioritize leads based on purchase intent; automatically execute multichannel outreach; and measure revenue contribution from each campaign. This allows you to scale your campaigns, reach customers more effectively and improve ROI.
Take a holistic approach to marketing analytics
Marketing teams often live in silos, focused on their individual campaigns and budget allocations, but it is imperative for the broader organization to have a complete understanding of the effectiveness of their marketing channels, and the acquisition costs across each channel relied upon. Increasingly, more mature DTC businesses are moving their teams away from siloed channel management and managing their digital marketing channels (and team structure) holistically.
Tracking relative performance across digital marketing platforms is notoriously difficult given the different data sets and metrics reported by each. Consequently, more and more DTC businesses are investing in tools to help monitor ROI across platforms in order to better judge where to direct spending. CDPs are also becoming more important for managing disparate data and channels. This also allows the team to react with flexible budget allocations versus preallocating the budget to individual channels.
Diversify sales channels — move to omnichannel
Very few brands are still pure-play DTC, and moving into omnichannel can be an extremely attractive way of increasing brand awareness and quickly ramping up sales, albeit at the expense of direct customer relationships and first-party data collection. Countless DTC brands — Soylent, Aloha, Belgium Boys, Ministry of Supply and more — have moved onto Amazon. Others, such as Fly by Jing, are fast-forwarding their in-store grocery rollouts. Big box retail has also been a way to propel a brand’s growth — a strategy adopted by several DTC businesses in the beauty space (Dr. Squatch in Walmart and Function of Beauty in Target to name just two).
Increase organic traffic
Maximizing the share of consumers through “free” or lower-cost channels such as referrals or affiliate links can have significant impact on a company’s blended CAC. While this isn’t easy, there are many examples of brands that have done it successfully using a handful of strategies:
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Referrals: Native is a natural deodorant brand that has had considerable success with a referral program in which both the referrer and referee receive a free mini deodorant. Their testing showed that free product samples were more effective at generating referrals (and impacted profitability less) than “give $xm get $x” offers. But others have reported success with this monetary incentive scheme, and many brands such as LOLA, Dr. Squatch and others follow this tactic.
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Influencers: While this is a well-trodden path, finding an authentic influencer can lead to a significant uplift in sales. Curology launched a YouTube video with Emma Chamberlain in May 2018 that generated over 2 million views, mainly due to the fact that she was a genuine user, and the campaign was authentic. Creator management platforms can help identify relevant influencers for a brand, engage them on campaigns, track the performance and manage the workflows to build credibility among the target audiences.
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Focusing on content: Consumers are overloaded with social media, so having content that stands out is crucial. When your content goes viral it’s an added bonus; to increase your chances, make sure you have an angle — whether it’s humor, authenticity or simply standing out. Leaders like Dollar Shave Club and growth brands such as Truff and others have continued to invest in unique, funny and compelling content on their own social platform pages to create brand recognition and word of mouth.
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Finding the right partnerships: Partnerships are also a means of generating brand awareness. For example, Bombas socks teamed with Sesame Street for exclusive product releases. As a B Corp, Aloha partnered with Conscious Alliance and worked with Chicago schools. Many food brands partner with celebrity chefs. The key here is making sure the partners you select are a good fit for your brand message.
Other tactics include affiliate links/PR links (e.g., Vogue published an article about Away’s initial product when it first came out in 2017), online blogs and pop-up events and samples (e.g., Dollar Shave Club created a retail pop-up inside Neighborhood Goods).
Improve onsite conversion
A lot of traffic can drop by the wayside if your website does not offer a great shopping experience. Areas for improvement can be identified by analyzing drop rates at each point of the exploration and purchase journey. Making those improvements can yield dramatic results: One DTC business in the protein bar space saw an eightfold increase in conversion when they revamped their website.
Following the consumer through the purchase journey can also contribute to conversion. Enabling landing pages specific to the ads they clicked through helps maintain a consistent customer experience, and also gives you more tracking data. You can go a step further by incorporating personalized digital experiences using a digital experience platform (DXP) — typically a suite of complementary modules that help marketers create, manage and deliver targeted content at scale to optimize the entire digital experience. A DXP will also allow you to experiment with personalized content and use the resulting data insights to improve the customer experience.
Another factor that boosts conversion is the availability of fast or free shipping, something that has increasingly become table stakes in the DTC world, despite the cost (see Figure 4). Consumers often expect free shipping and can be turned off without it, even for high-ticket purchases. Offering free shipping with a spend threshold can help increase average order value (AOV) and product trial, which can in turn raise customer lifetime value.