Read most any marketing and advertising industry publication and you will hear a constant drumbeat about how (mostly consumer-facing) brands are being disrupted in the marketplace.
The rise of direct-to-consumer (DTC) brands reflects what now can be called an “on-demand” marketplace. Suffice to say, this has profound implications for all other brands looking not only to preserve their current position but to grow. It shouldn’t be a surprise then that many brands might want to look to an agency partner for help navigating this massive disruption.
But what, exactly, should a brand look for if they are shopping for a marketing agency whether it be on Madison Avenue or in Madison, WI?
The New Landscape
Let’s first look at what’s going on here.
A new breed of DTC brands has disrupted the normal go-to-market path of the legacy brands in their categories. Enough has been written about the phenomenon, so I’m not going to rehash it here. But if you’d like an overview, WARC published an excellent DTC brand primer that you can check out here if you’re a subscriber.
These DTC brands do play by different rules and have changed the market dynamics for brands that want to remain viable and competitive.
- Challenging category conventions in ways that directly benefit the consumer
- Focusing on intrinsic value (e.g., design, performance, ethics, attitudes) of the product rather than price
- Creating a heightened emotional connection to the brand
- Using traditional retail in untraditional ways (i.e., creating a better brand experience)
- Appealing to people’s unreasonable natures by allowing them to have it all – fast, affordable AND high quality
Successful DTC brands have a compelling value proposition. And they wrap that proposition in an authentic brand voice and story to create rich and engaging (mostly digital) relationships with their customers. They gain traction by investing in performance marketing tactics and customer acquisition through digital channels. Using a “lean” approach, they move quickly.
Because they mostly bypass traditional distribution channels and focus on selling through their own website and social media, they exert greater control over their brand while owning their customer data. Which further boosts their performance marketing and new product development efforts.
Now that many of these upstart brands have gained critical traction in the marketplace, they are turning to the traditional awareness and reach tactics of the legacy brands – mainly television. This will only increase the pressure on all brands to rethink how they are protecting their space in the market.
And as the economy approaches the end of the current expansion cycle, companies will need to place even greater attention on protecting their brands and adjusting their go-to-market strategies. Or face the prospect of declining market share, price erosion and overall relevance.
So, the question brands ought to be asking themselves is whether their brand is ready to compete in an on-demand world.
Feeling the Pain
If you are more of a traditional brand that has multiple distribution channels, that has historically relied on the tried-and-true messaging tactics of the past, you are no doubt already considering or engaging in discussion about how to compete in this rapidly changing environment.
Questions you’re probably asking include:
- Do we really know who our consumer is?
- Do we truly understand what is (or is not) motivating them?
- Is our brand promise distinctive and relevant?
- With so many media channels, where and when do we connect with our consumer?
- How do we capture those moments of engagement?
- Is our brand consistent across all those different touchpoints?
- Do we know our marketing metrics (including our ROI)?
- Can we maintain our pricing power in the market?
- How do we effectively compete in this environment?
- Can we respond quickly enough to changes?
- How do we mobilize and align leadership and the company behind changes we need to make?
Let these questions be your guide as you shop for a marketing agency partner to help you navigate a quickly changing landscape.
A Marketing Agency Shopping List
As you look for a marketing agency partner to help you effectively compete in an on-demand economy, here are 11 things you should consider:
Do they have deep, demonstrated experience and a repeatable process in brand positioning, strategy and identity? Today’s brands need to express themselves across a whole new spectrum of touchpoints. Forget TV and outdoor, think Instagram and Google. Will your brand be consistently supported by the messaging and identity in these various formats?
Do they have the ability to uncover your customer’s core motivations and discover your brand’s core emotional drivers? This is more important than ever. The DTC marketing playbook relies less on general brand-building and more on consumer empathy, so you better know what your brand is about and who your brand is for.
Some agencies are very good at performing research and developing a strategy. Yet they may not demonstrate how the brand and strategy will creatively live in the marketplace. The brand must translate into an effective and consistent creative expression wherever it may live.
4. Path to Purchase
With a dizzying choice of channels where “everything is media,” do you understand your customer’s journey well enough to find and engage with them? Can your agency partner help you get there?
5. Modern Marketing
Do they understand how brands, especially those with limited budgets, effectively compete in today’s market? Performance marketing is about hyper-targeting your customer, delivering the right message and delivering an effective call to action. Does the agency have a test-and-learn mentality to optimize the message and drive down the cost of acquisition? And would they understand and employ the effective role traditional media tactics can still play?
6. Customer Data
One of the fundamental advantages DTC brands have over their legacy brethren is the quality and quantity of first party data that contain insights for building richer consumer connections and inform developing products and services they could sell in the future. If you don’t have those direct connections to deliver data, can your partner help develop your strategy to get meaningful data through other means?
7. Team Alignment
Often, legacy brands can suffer from old processes and thinking about what effective marketing should be. Finding the right marketing agency partner can help provide some third-party credibility, perspective and evidence on what works and why. And they can help with the “buy in” from others in the organization to support new strategies and tactical executions.
8. Team Integration
Most brands have built their own marketing capabilities and want to maximize that investment. Does your marketing agency have demonstrated experience collaborating effectively with in-house teams and other agency partners? Are they a good cultural fit for your team?
9. Business Metrics
Is your potential marketing agency partner focused on business goals? Do they know how to ladder fuzzy marketing goals like awareness into more solid metrics, like lead generation? A good partner knows they succeed when you (the person and company) succeed.
An extensive (re)branding effort might have required 8-12 months a few years ago. Today, it probably needs to happen in 8-12 weeks. Every week of delay means lost share and revenue. The DTC brands have adopted the Lean Startup, or agile, approach as an operating methodology. Established brands, and their agencies, need to move with similar urgency.
The days of annual planning are fast becoming a quaint notion of the past. Chances are you need an agency that can adapt to the financial flexibility a dynamic marketplace requires. Are they willing and able to develop their pricing around your needs?
Of course, there are other important elements to selecting a marketing agency like team chemistry, creative chops and pricing.
And here’s a tip: The best partner to help you navigate the DTC world may not be a big, traditional agency. After all, they often have as much invested in the status quo as the most intractable member of your management team does. I happen to lead a marketing agency in Madison, WI, and as self-serving as it may sound, our position outside of traditional adland zip codes (and tax brackets) tends to grant us the ability to behave and work differently.
The bottom line is, all brands need to adapt to the disruptive changes occurring. The stakes are high and the price of failure could be fatal. Finding the right partner to fit your particular needs could be the help you need to successfully navigate a tricky transition.