Sr. Director, Marketing
The direct-to-consumer lines have blurred – brands are not only defined by how their products are manufactured or distributed. DNVB’s (digitally native vertical brands) have reached new levels of maturity, evolving with innovative expansion strategies like making inventory available to wholesalers, launching pop-up stores and even moving into brick-and-mortar retail locations.
This “phygital” (physical + digital) infrastructure, a term most notably used by UNTUCKit’s CDO and CIO, Lockie Andrews, is intended to be omnichannel, agile and integrated, delivering customer-centric experiences. Similarly, an omnichannel audience mindset needs to permeate a DNVB’s evolving marketing strategies. Doing so will lead DTC marketers, who have found success acquiring and retaining customers via cost-efficient social and paid media inventory, on an exciting channel exploration full of opportunity.
Consumer behavior has shifted rapidly – now spending more time at home and streaming more content than ever. The future of addressable marketing in digital channels, which has served DTC brands so well, is in a state of flux as pressure mounts for a new identity mechanism to replace cookies and mobile device IDs. And traditional retailers have re-evaluated legacy business models, opening their own DTC sales channels, leading to increased competition.
So, if you’re seeking to differentiate and connect with consumers in consistent and meaningful ways, there are “new” options you need to consider when expanding beyond digital-only. TV and direct mail specifically, are two channels every DTC marketer should explore in 2021.
What’s Old is New Again
Brands seeking fast growth driven by an audience-based strategy have historically turned to digital for the addressability and measurability. However, when looking at advances in infrastructure and technology within more traditional channels, like TV and direct mail, one thing becomes evident: an audience-driven approach is more portable than ever. Like digital, these channels can now enable powerful relationship building with current and prospective customers, extending it to new areas and opening up new possibilities.
Using either of these channels would have been unthinkable for DNVBs in earlier stages, as they were considered too expensive, too broad or just all-around too “old school”. But with continued fragmentation and more people at home, both TV and direct mail present opportunities for growth in different ways.
How TV is activated will vary across CTV, OTT, or Addressable TV, but the audience data can remain the same regardless. The biggest screen can still serve as a brand awareness arm, but the benefit is that you can start with more refined audiences than just age or gender. Additionally, you can use audience data to generate lower funnel, data-driven, DR campaigns. Especially with new and engaging shoppable ad units that allow viewers to buy directly from their TV.
Direct mail on the other hand is less about awareness or brand building, rather creating a tangible experience in an uncluttered ad environment. Many DTC brands find direct mail attracts more loyal customers, as they make additional efforts to respond to the brand’s offer. Direct mail is also easier than ever to test and refine strategy, without a huge investment.
Time to Test
There is more at stake when you look at the investment required for executing in these channels. It will require finding the right partners, developing the creative and delivering. A slight departure from putting down a credit card and turning on a Facebook or paid search campaign.
Chances are that you’re not going to just dive right into both TV and direct mail. Determine where your current challenges are and develop a plan. Do you need more brand building and awareness? Or an increase customer retention and loyalty? The answers to these types of questions will help you decide where to allocate resources and prioritize a test.
Executing in TV or direct mail is going to require greater investment, in terms of both dollars and time. With the exception of CTV/OTT, which you can simply activate through your DSP, you will be paying higher CPMs and other new or incremental execution costs. You’ll likely want to partner with an agency or consultant with connections and experience that will help you navigate these new worlds.
For TV, they’ll help you understand MVPD’s (cable or satellite providers) and consortiums. On the creative front, producing television ads may require an expertise and resources you don’t have. A partner could also advise on the world of customer generated content, where brands have become more inventive than ever, producing powerful ads on small budgets and short timelines.
For direct mail, support will help with the logistics of audience planning, printing, postage and overall execution. Direct mail offers many formats, ranging from basic postcards to beautifully designed catalogs. A partner will help you test what works best for you, being mindful of the incremental costs across a range of creative options. There are also exciting new tech platforms available, such as Postie, that provide a more seamless expansion to direct mail for digital marketers. Similar to TV consortiums, platforms such as Postie reduce the amount of service providers required for execution and are a great way to test and refine with less resources.
Moving into 2021 and beyond, think about what each channel would mean for your roadmap. Evaluate the time to secure funding, evaluate and onboard partners, develop creative and launch - aligning that with the timing of your goals. Carefully consider consumer behavior across the different channels as well. A TV ad may induce an immediate response, while direct mail may be absorbed on an individual’s own schedule and notoriously has a longer tail for measurable response. In either case, measuring results will require more patience when compared to the instant feedback of your digital campaigns. Having a clear understanding of this will help set expectations with your stakeholders.
Ready to Get Started?
Like everything new in marketing – start with a test. Use the considerations outlined here to help you decide which path is optimal and take the first steps. Here is a little quick reference chart to assist you on the start of your journey as well.
|Addressable TV||CTV/OTT||Direct Mail|
|Recommended Test Budget||$500k - $1MM||$25k - $50k||$15k - $30k|
|Minimum Audience Size||500k-2MM||500k||10k|
|Key Players||MVPDs, Consortiums, Agencies||DSPs, vMPVDs||Agencies, Direct Mail Platforms, Logistics Partners, USPS|
|Benefits||Scale, Consumer attention||Reach cord cutters, Easy to activate||Low clutter environment, tangible experience|
|Best For||Branding, Awareness, Household targeting||Branding, DR, Interactivity||Brand recall,
Co-targeting, Customer retention
While testing new channels can seem daunting; it will be worth the risk. To ignore growth opportunities due to fear of investment is like idling in the right lane in your luxury sports car, when the fast lane is wide open. Buckle in your consumer-centric audience strategy, throw on your blinker, hop in that fast lane and hit the gas straight into 2021!
Want to talk strategy or build a custom audience? Contact the Alliant team to learn how powerful transactional data can improve your campaign performance across all channels.