Act like your customers and shop around to avoid the cost of customer acquisition

Outbrain’s Vice President of Global Advertising Revenue Ayal Steiner shares some exclusive insights on why he thinks diversifying your DTC marketing channels could be the key to boosting customer acquisition.

Do you remember the buzz when Dollar Shave Club launched? It was a new concept, a subscription service providing new razors to people every month for a low fee. It caused a buzz, and more importantly acquired a lot of customers very quickly.

It’s been 10 years since that now infamous launch video went viral on YouTube, leading to 12,000 orders in a matter of hours. The Dollar Shave Club wrote the rulebook for the emerging category of direct to consumer (DTC) brands, attracting more than three million subscribers in its first five years with exemplary digital marketing.

But why am I talking about a decade-old story? Well, fast forward to 2022 and most brands now have the opportunity to be DTC themselves. The pandemic has fuelled the rise of ecommerce among consumers and with tricky supply chains cutting out the middlemen of retailers, DTC is increasingly attractive.

Add into that heady mix the need to create direct customer relationships as coming changes like the deprecation of cookies and impending regulation mean first party data is now table stakes for any future-facing brand.

And the rulebook that Dollar Shave Club established is still largely what is used – to focus budgets on customer acquisition, rather than impressions and reach buying.

But I’d argue marketers aren’t learning some of the most fundamental rules established by early DTC pioneers. That is, exploiting emerging and under-used digital channels to get their message across in a new and interesting way to engage customers. This is an evolution to the way most marketers have been operating, who have the goal of pushing ads out to more and more eyeballs, rather than pulling them towards the company website.

You see, while the duopoly were large businesses back in 2012, they weren’t the establishment of marketing. TV, radio, out of home and newspapers (or above the line as we used to call it) were the established channels, and it was younger, more innovative brands driving digital frontiers. This has affected how consumers think too – they’re now after informative and nutritional content from brands that educate while it engages.

So these platforms were relatively free of competition and cheap to exploit – there was room for viral sensations and growth. Today, that’s not the case, established brands are bidding against cashed-up upstart rivals for the same eyeballs. We’ve come up with new ways of providing meaningful content to consumers to help improve our chances in the race, and the success of native advertising is testament to that.

Now maybe the real lesson is that it’s time for smart marketers who don’t have piles of cash to burn through in search of customer acquisition to look outside these channels and diversify. But advertising dollars are accountable, and the return on advertising spend is clear – so marketers need to think of new ways to engage customers, rather than engaging in the eternal struggle for more eyeballs.

There’s a wide world (or World Wide Web) out there waiting to be explored.

If your customer acquisition costs are lagging, and your brand’s growth isn’t what it should be, then perhaps it’s time to heed the real lessons of the DTC pioneers, and play in the places others aren’t yet.

The barriers to entry are relatively low too. Ultimately it’s about understanding what these options are and how to use them effectively. This is a case that requires some education on our part.

Ayal Steiner

Ayal Steiner, Outbrain’s Vice President of Global Advertising Revenue


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