2019 was a year of success and failure for the retail industry.
DTC marketing brands seized an even larger share of the market (18% over last year) while native brick-and-mortar shops plummeted, with 9,300 closing.
The future seems to be brighter than ever: but is that so? With the rising costs and the ever looming Amazon and its knock-offs, will direct to consumer marketing still be viable in 2020?
Yes, and here’s why.
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How to make direct to consumer marketing work in 2020
Direct to consumer advertising has been around for some time – much longer, in fact, than print, radio, television or the Internet.
In recent years, we’ve seen the rise of empowered consumers who aren’t persuaded by huge marketing campaigns and prefer a more personal approach. In turn, DTC marketing has been booming, with companies like Warby Parker, Dollar Shave Club. and Casper inspiring thousands of others.
Couple that with years where digital advertising platforms like Facebook and Google outperformed traditional channels by a mile, it was the best of times.
But, the gold rush might be coming to an end.
The reasons why this phenomenon is happening can impact your marketing strategy and success going into 2020 and beyond.
People don’t hate advertising: they hate bad, bland, intrusive attempts to get them to buy something they don’t want.
They like – and want – a brand that doesn’t push them to buy, but pulls them in, gives them value and nurtures their connection. Buying from such a brand comes as a natural consequence.
If you want to become such a brand, there are proven ways and tactics you can follow – and DTC channels are perfectly suited for it.
5 DTC advertising guidelines for 2020
Here are the marketing guidelines brands will need to follow in 2020:
#1. From marketing to branding
The fundamental shift every company that relies on DTC advertising will need to make is going from marketing to branding.
As the markets become more and more saturated and the CPA keeps increasing, outbidding the competition will no longer be an option, especially for small and mid-size brands.
Veronika Sonsev, co-founder of CommerceNext, writes for Forbes about the importance of brand marketing over performance marketing:
“For example, Adidas shifted its spending heavily to performance marketing, investing 23% into brand and 77% into performance. As it built out its attribution strategy, they learned that brand activity was actually driving 65% of sales across wholesale, retail and ecommerce. Now, they are moving to a 60:40 split in the brand’s favor.”
#2. Split the focus between the tried and the new.
Despite all the doomsday talk, Facebook and Google aren’t going anywhere.
While the average cost-per-acquisition is likely to go up, PPC campaigns still offer some of the most powerful targeting tools with which you can go above and beyond to reach the perfect customer.
This as well is where smaller players can beat the big fish – by finding small niches or sub niches that the larger companies can’t target. You can use your size as a strength to offer a very specific offer to a very specific subset of people, something big brands can’t do.
For middle and large brands, the smart move would be to get on new, prospective channels as fast as possible.
New social media platforms and other business to consumer marketing channels are emerging at a faster pace than ever before. One of them is going to be “the next big thing”. Predicting which one, of course, is a hard task, but smart marketers are always testing (our ABC is ABT – always be testing), waiting for a better option to emerge.
While this may dilute the focus for smaller companies with limited resources, it is still a viable strategy – but in the case you pick a losing platform, you risk a lot more. But if you get on the right one at the right time, you can effectively take your share of the platform pie – and grow with it.
#3. Own the means of advertising
The channels we’ve been talking about so far – Facebook, Google and the like – all have one drawback:
You’re not in control.
You can never really be sure Facebook won’t approve your ad or if Google will drive less traffic to your placements for some reason that you won’t see.
The same goes for free direct to consumer communication. Who knows when a big player decides to cut your organic reach.
The solution is as simple as it is elegant: create your own channels or bring customers to your own channels.
#4. Create your own channels
Ever wanted an app for your business?
In the current media landscape, there’s no better marketing channel to own than a mobile app.
Since everything is mobile-first, a well-thought-out application can become your one-stop-shop for customers, doing everything from content to sales.
Websites are a close second option, but they are a few more taps away and depend on ranking algorithms, while your own app is the closest to complete control you’ll get.
Both of these don’t need to be 5- or 6-figure investments. Often, simple and easy to use can outperform expensive apps, filled with clutter. Not to mention that a one-time expense can be cheaper when you consider the cutting of advertising costs.
#5. Bring customers to channels you control
A powerful direct to consumer marketing channel where you hold control is email.
An email list that is well-nurtured, attracts the right people and uses a great strategy can be an invaluable asset to a business, because they have a direct connection to the consumers.
While this may not be an attractive option for brands primarily targeting teens and early 20’s, there are plenty of fields where emails are well accepted as a communication channel.
Another option is Facebook Messenger marketing and chatbots. You have less control than with email, but the open and click-through rates are more than enough to consider: up to 88% open rates and 56% CTRs, which is comparable to the early days of email.
For the most personal approach, SMS marketing takes the cake with some impressive results: it earned 592% higher order rates than email.
Omnisend data shows that combining more marketing channels to reach out with your customer helps improve your business engagement rate and boost your sales by 13% percent.
The future of DTC marketing
DTC is here to stay.
No matter which DTC marketing channels you pick, the principles discussed will always work, because they are based on how people like to interact with brands.
And while marketing tactics change, people don’t.