This post originally appeared on MediaPost on February 6, 2019.
By Ari Lewine
There are now over 400 direct-to-consumer (DTC) brands that have collectively raised $3 billion in capital since 2012, according to an Inc. article. These DTC brands have built and sustained successful businesses largely through social media advertising on platforms like Instagram and Facebook, but that’s now changing.
There’s more competition than ever among both DTC and large brands, and social media platforms, with their ever-changing algorithms that hurt viewability and deplete brands financially with diminishing returns.
Now, the very DTC brands that once found success on social are scrambling to more traditional media to find their audiences — including traditional and connected TV.
However, we’re quickly seeing that when you move a social-media strategy to streaming television, the ad strategy needs a new framework.
The Creative Challenge for OTT
What’s made DTC brands successful on social media is the rapid iteration of creative that’s highly tailored to their customers. As consumers interact and share content, the platforms collect first-party data that goes back to the brand, helping it refine and produce more creative quickly.
15- and 30-second TV ad spots, on the other hand, have been traditionally resource-heavy in both cost and creative bandwidth — which ultimately reduces the scale at which brands can release these types of ads.
And while DTC brands seek to use connected TV and OTT to reach their target socially media- savvy Gen X, millennials, and Gen Z, these audiences are the very people cutting cords the most and subscribing to streaming, specifically circumventing traditional media’s rising costs and ad loads.
To see Ari’s three major recommendations for DTC brands to thrive in OTT advertising, check out the full article on Mediapost!