Brands Need Better Direct-to-Consumer Marketing Strategies in 2020

This is not to say that digital marketing isn’t working. We’re saying that direct-to-consumer needs to always be part of the strategy.

According to Edison research in March 2019, Facebook lost 15 million US users in the past two years. That’s a 62% cut in users in 2017. This was followed by another 61% decline the following year. ^[1] 

Inversely, ad spending on social platforms increased by 20% at the end of 2019, according to Zenith, a media agency owned by advertising giant Publicis Media. ^[2]

However, an article published by e-commerce platform, Shopify, has observed that advertising and marketing campaigns launched on digital channels like Facebook are no longer providing the same ROI as it used to a five years ago. In fact, 67% of users haven’t bought from nor directly within social media channels. ^[3] 

What do the statistics mean? 

The numbers above are pointing brands to a back-to-basics direction where customers and the product need to be elevated instead of just “the story.”  

For the past five to seven years, marketers have focused so much on creating a story behind the brand—often without considering whether it will convert to a sale. While we all appreciate a good story that makes us laugh out loud or tear-up, at the end of the day, a business needs to make a profit. 

Likes, Hearts, and Shares on a viral video can only go so far in terms of driving interest to a brand. The question is, will those be enough to get customers to the door and keep them returning for more? 

Measure Success with Customer Acquisition Cost (CAC) 

It will serve marketers better to pay for CAC instead of clicks and impressions because the latter does not always equate to conversion.

Furthermore, the digital ad space has become overly saturated to the point where consumers are forced to watch ads or click on pop-ups before getting to where they want to go. 

Campaigns that can measure the cost of acquiring new customers such as free-trial sign-ups, subscriptions, and limited-time offers provide high-value incentives for customers which have a greater ability to get people to opt-in and stay. 

Pair these types of campaigns with Rewards Advertising and your business will have a potent marketing formula that leads to higher revenue and higher consumer loyalty.  

What does “rewards marketing” entail? 

Rewards marketing is a direct-to-consumer strategy that provides your business with a pool of already-engaged customers who are willing to try new products, leave positive reviews, and refer your products to their network.  

We’ve seen the efficacy of this type of marketing with Amazon, specifically with their Prime membership.

According to an article from Inc.com, Amazon Prime customers spend an average of $1,300 annually compared with about $700 for non-members. This clearly proves that customers who opt-in do so with the intention of spending more. 

Small businesses that use the subscription model have also gained promising revenues over the past couple of years because their subscribers represent a niche market they can claim and cultivate while avoiding the cost of wide-net targeting. 

To be clear, rewards marketing can be done both via digital and traditional media. In-app rewards programs seen on Amazon and on-ground activations (e.g. free merchandise at trade shows, members-only perks in-store, etc.) can use this strategy to build a loyal customer base. 

Buff-up Your Strategy with Tactile and Experiential Marketing 

Traditional tactics like direct mail marketing, personalized customer support, and store activations are high-reward investments that require more resources — however, they are better guarantors of long-term sales. 

Authenticity has been lacking or has appeared so because phone screens and computers have replaced the element of person-to-person interaction. Being able to hold a tangible item in one’s hands—for example, a box of sample-sized beauty products with a personal invitation to an event—gives the recipient a feeling of importance.

Therefore, the experience is more likely to be remembered and they will be genuinely enthusiastic about attending your event, as well as raving about your product. 

This is the same reason why business owners continue to send gift baskets to clients. Personalized gifts bridge the gap between impersonal email exchanges and social media posts. The simple act of creating an experience for someone forges relationships. Ultimately, tactile gifts and experiential marketing wins hearts. 

In conclusion 

Direct-to-consumer trends have already shifted the digital space, and they will continue to do so as more businesses embrace this marketing model. People want real and meaningful experiences with the products they use or subscribe to, more so now than ever.  

While businesses have to be adaptable to technology, trends imply that combining digital efforts with direct-to-consumer tactics is the approach that leads to long-term, sustainable growth. 

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