The New Era of Brand Marketing: Performance Branding for Digital Native & DTC Brands

We have explored the path to performance-driven brand marketing for more established brands and how that transition to a performance branding framework should be strategically navigated. But what about brands that started life online? Digitally-native, direct-to-consumer businesses usually view traditional brand marketing as a mysterious discipline, far removed from their day-to-day action-focused campaigns.

But successful brand marketing augments and strengthens performance marketing efforts, and more and more digital brands are dipping their toe into performance branding.

That decision-making process is obviously different for every brand, but usually starts with this basic chronology:

• A digital brand launches and seeks to capture the lowest hanging fruit via search, shopping, and lower-funnel social campaigns
• They work on their organic presence and overall contextual relevance in their given category so that in-market customers can find them; then  the new brand becomes part of the consideration set
• Next, they layer on an audience strategy to leverage paid media touchpoints for these in-market mid-funnel activations, mapping KPIs back to ROI-focused campaigns.

Once a digitally native brand is effectively capturing demand and establishing themselves in the mid-funnel consideration set, what next?

Some brands switch focus to efficiency tactics: pure optimization of the existing campaigns, and jumping on new activations that fit within their ROAS-focused framework. But to succeed in the long run, it’s necessary to start generating demand, not just capturing existing interest. If you operate purely within the sphere of existing demand, you leave yourself open to diminished market share as competitors muscle in, relying on the industry pie itself to grow without actually leading the charge. This is essentially an optimistic, short-term view that can lead to a slow, profitable death.

If you want to drive meaningful growth, you need to start focusing on long-term and brand-building actions. That’s where performance branding comes in.

As a quick recap, let’s remember the three basic steps of the performance branding roadmap:

1. Set the foundation.
2. Experiment.
3. Accelerate to mass personalization. 

Although we always want to focus on objective, real-time KPIs to support a data-driven framework for all our campaigns, that’s a lot harder to do when it comes to branding initiatives. That’s why it’s important to set out the overarching goals of our performance branding strategy right away. These can consist of some or all of the following, which we’ll refer to as “Branding Objectives”:

• Capture attention of consumers so that my brand is top of mind when they are in-market
• Educate the consumer as to what my brand does, particularly if our product or approach is novel or distinct from other offerings
• Establish clear positive sentiment around my brand or product

But it’s likely your marketing team will have one key hurdle to overcome before embarking on the performance branding journey: convincing your CFO to get on board.

Make the case for performance branding to your CFO

Start building your case by focusing on what you know your CFO wants, which is usually right there in the core business objective (CBO).

Does your company have aggressive growth goals this year? If the objective is expansion, you’re in an ideal position for a performance branding play. Lay out your logical, data-backed plans to grow the pie while minimizing the risks of inefficiency or wasteful spending. Map your assumptions and opportunities back to the CBO itself to show a clear path. Then you’re at least speaking the same language, and your CFO can have confidence that you have the company’s goals top of mind.

If your industry is not expanding, and you’re just looking to improve market share, or worse, your industry is shrinking and you’re just trying to stay afloat, you may have a harder time convincing your bosses to unlock funds beyond the lower funnel. However, one could argue that the need for performance branding is even greater in this situation, as you explore incremental avenues for growth outside of the norm and seek to forge a new future, rather than fighting over slices of an ever-shrinking pie.

Whichever path your brand is on, make sure your pitch to the CFO is in line with how your company is positioned in the market, and the broader goals the company has set for the next few years. The number one way to get a very speedy “no” is by failing to align your strategy with the interests of the executive.

Once you’ve found the right positioning, you’ll need to quantify the opportunity.

This can be tricky if it’s a brand new channel, but getting a head start on that first foundation-setting stage of the performance branding roadmap will help you establish data benchmarks to work with, without any additional cost.

You also need to dig into the data you already have to set the scene for this branding journey. You might already be leveraging valuable branding information in your lower-funnel campaigns, such as:

• Audience insights: Consider a customer lifetime value analysis, audience segment comparison, and demographic overview. While narrative personas might not resonate well with data-driven exec members, some key takeaways on who loves your product or service right now, and, especially, who drives the majority of the profit or revenue, will be key to informing the audience targets and quantifying the size of the opportunity.
• Product/service insights: Dive deep into what consumer problems your device or service solves, or what questions it helps to answer. Ask yourself if those solutions lend themselves to a broader addressable market as you grow or capture contextual opportunities in the current landscape. For example, in the current pandemic, many entertainment locations are closed, from movie theaters, to theme parks, etc. What gaps have opened up, and does your service or product help to fill any of those gaps? Translate that into data points like audience size, search volume, or market growth, and you have a logical basis for your case: the measurable potential pay-off from growing into that space.

Remember to set expectations, especially around the time it will take to start to be able to see and measure the impact your efforts are having. Although we are looking at real-time data, the trends for brand KPIs should grow over time, versus seeing a dramatic change overnight. Be transparent about “what good looks like” so that you can loop back to assess the impact of any given tactic as you climb the funnel. 

Set the foundation for brand marketing that performs

As mentioned above, we’ll need data to make logical assumptions on what performance branding could do for your business.

The great news? You can start to track those data points before launching a single test or spending any incremental dollars.

This will set a benchmark you can use to make your case and help you estimate the indirect impact of performance branding initiatives to your bottom line. Once launched, they can also help you assess performance, Here are some examples of real-time, objective data points you can track right now, and what they will help show as you build towards your performance branding launch:

How to get started

It’s not in your best interest to go all-in on every potential tactic right away. Just as the big brands take incremental steps into performance branding by layering in or replacing traditional avenues one channel at a time, so should digitally-native brands systematically progress one tactic at a time, moving up the funnel. This allows for careful measurement at each stage to understand the impact of each new venture.

Not to make things overly complicated, but it’s worth noting that your performance branding journey is going to be highly specific to your brand and the success you’ve enjoyed to date, so there’s not a single right path or cookie-cutter way to proceed.

But there are some helpful guidelines we can share that are common to digital native or DTC brands. Let’s take a look at some of the channels you might want to explore first, depending on what performs best for you now:

Closing the Loop

Finally, make sure to circle back with the executive team to demonstrate the impact of what you’ve tested. Some key guidelines here include:

• Always tie back to the core business objective: don’t stay in the weeds of marketing KPIs (that can also put a stop to a line-by-line assessment, where attribution challenges will muddy the waters).
• Map against your expectations: how do your results compare to the initial picture of what good looks like that you painted? What has been happening to the industry over the same time period and what impact did that have? Collate those learnings and adapt your plan accordingly.
• Be transparent: if something didn’t perform as planned, be the first to call that out. Note clearly where you were disappointed, determine whether you should start, stop or continue each initiative, and set clear recommendations for the path forward. We learn more from failures than we do from successes, so highlight any and all learnings that can inform the future strategy or the business as a whole. For some executives, these experiments will be a leap of faith. Appreciating that and being honest about the results will go a long way to retaining that faith for future initiatives.

Learn more about the performance branding framework and how branding initiatives could make an impact on your business by downloading the full guide, Performance Branding: The Evolution of Brand Marketing.