4 insights for ecom marketers from our H2 strategy pack
Luke Jonas ????
Co-Founder @ Nest | Scaling US brands in Europe & UK brands in the US
Our July edition of the Readout included a strategy pack for H2, covering insights on international strategy, brand strategy, measurement approaches, and more. Here are 4 key insights from the report that will help you grow your brand:
1. We recommend upper-funnel tactics at every stage of growth
Since the onset of the internet, performance marketing has allowed for highly targeted marketing campaigns – and is behind most brand’s online growth. However, iOS 14 greatly impacted targeting, narrowing attribution windows and reducing the quantity of tracked conversions.
In an environment where quick results are few and far between, ROI has to be measured differently, and this has led many marketers to return to brand.
Upper-funnel tactics are a powerful opportunity to drive incremental reach and generate new customer demand. We suggest a growth strategy that leverages full-funnel activation alongside brand solutions.?
Managed correctly on Meta, cheaper traffic achieved through investment in brand will feed into your retargeting campaigns, resulting in cheaper CPA. The wider and less competitive audience size, in addition to additional learnings, allow the algorithm to learn faster. Brands that continue to only invest in performance will limit their growth and will see increased CAC.
2. Finding new audiences is crucial to keep growing
When tactics and channels that used to drive growth start delivering diminishing returns, or if your ROAS is flatlining while your CAC skyrockets, you likely have an audience diversification problem.
No matter how good your set-up is for one tactic or channel, eventually you will exhaust its potential. In a competitive environment, with fewer consumers in market, having the right strategy to find new audiences becomes crucial.
Once you have accepted your brand needs to find new audiences, there are different approaches that we suggest:
It’s likely that you are only hitting a small percentage of your potential future audience. The opportunity here is significant, while the risk of overrelying on a single demographic is greater than ever in the current climate.
3. Winning on just Meta or Google isn’t enough to scale anymore
For most of the past decade, Meta and Google dominated the digital ad space. However, the emergence of new channels like retail media, as well as younger demographics switching to TikTok, means that for the first time since 2014 this is fading.
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Increasingly, users are splitting their time and attention between multiple channels. This brings both challenges and opportunities.
While each channel has its own barriers to entry, these are steadily diminishing as platforms automate more elements of media buying. Meanwhile, you can apply best creative practice from formats like Reels to TikTok or YouTube Shorts.
Ensuring that you are playing to the strengths of each channel, and that your strategy for each is working in tandem, is key.
This is where having the right channel diversification strategy comes into play.
Knowing which channel split is right for your brand depends on your AOV and the demographics that are targeting. That said, you should definitely be testing on other channels, especially discovery channels like TikTok, if you want to grow your brand.
4. A long-term approach will reduce customer acquisition costs
Despite recent reductions in Meta CPM, reduced engagement with online advertising since the pandemic years and a more unpredictable consumer environment means that many brands find it harder to meet their target acquisition costs.
Meanwhile, brands desperate for a quick cash infusion are overindexing in retargeting and Search, and not doing the prospecting required for sustainable growth. If this sounds familiar, it isn’t too late to turn around your brand’s fate.
There are tactics that will reduce your CAC. Investing in upper-funnel objectives in tandem with performance is key, while having the right measurement solutions in place will help you steer this investment.
According to aggregated Nest data, investment in as little as 10% of traffic activity drives 28% lower incremental in-platform CPA and 19% higher incremental ROAS when compared against unexposed audiences.?
When it comes to brand, even a comparatively small investment will have a significant impact on CAC.
Explore the latest ecommerce marketing trends, learnings and opportunities, as well as the rest of the H2 strategy pack, in the full report: