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How DTC brands can benefit from in-game video advertising

How DTC brands can benefit from in-game video advertising

Direct-to-consumer (DTC) brands and DRTV and Infomercial advertisers need to be looking for new mediums to promote their products and services, especially as TV continues a decline.  In recent years, many DTC brands have diversified their video advertising efforts to include social ads, but as social media ad costs rise is there another medium that DTC advertisers could benefit from?

The global in-game advertising market is on track to grow by $3.54 billion by 2025 and it is a medium that DTC brands should explore.  At first glance, advertisers might assume that the demographics of gamers are mostly teen males who do not fit their target market. However,  mobile gamers actually skew more female. Overall the mobile game market is 60% female and 40% male. In terms of age demographic more than 20% of mobile gamers are over 50 and 39% are between 21 and 35. This provides an enormous potential for DTC brands.

There are a few types of video ads that can DTC marketers can take advantage of within mobile games:

Interstitial Ads

Interstitial video ads are full-screen ads that typically appear in-between game level and allow players to skip the ad after about five seconds depending on the game.  Since these ads don’t interrupt the player’s gaming experience, they typically generate high impressions and conversions.

Reward-based ads

Reward-based video ads follow a “prompt, opt-in, reward” structure in which players choose to play the ad in order to receive a reward.  After watching the ad the player is rewarded with another life or some form of in-game currency to help them continue playing the game. Most gamers prefer this ad format and find it the least disruptive.

Both player and advertiser benefit from reward-based ads. The player is rewarded and the advertiser only pays for the ad if the player watches the entire ad. Additionally, since the ads are generally watched to the end in order to receive the reward DTC brand advertisers have increased brand awareness and recall. Reward based ads receive higher user engagement than interstitial ad formats, resulting in a higher return on ad spent.

Ads can be purchased on a CPA, CPM or CPC basis and the costs rival more expensive platforms like Facebook.

Although not top of mind for DTC marketers, in-game video advertising is definitely a channel that should be considered because it holds enormous potential to reach their target market affordably, increase brand reach, and get conversions.

DTC and Social Media: Snap back or flame out?

DTC and Social Media: Snap back or flame out?

Direct-to-consumer (DTC) and performance marketers have been steadily shifting budgets away from Direct Response Television (DRTV) to social media such as Facebook, Tiktok, and Snapchat to create awareness and grow their customer base. These platforms have been effective for DTC brands because of their consumer scale and focused reach via targeting and measurement.  However, just like the DRTV landscape shifts, so does the social media landscape causing DTC companies to diversify among them. 

Social media giants Facebook and Tiktok continue to lead the digital advertising world while others like Instagram and Snapchat have fallen behind.  

Facebook (Meta) the largest platform has proven successful through several rebranding efforts, including the recent “Meta” shift, however, they have faced backlash from DTC companies on the rising cost of their ad prices.  The rising cost of Facebook advertising has opened the door for TikTok.  The platform has paved the way for many DTC brands with its massive reach and engagement. They continue to stay on top of innovation and attract advertising dollars. In fact, TikTok is on track to surpass the advertising revenue of  Twitter and Snapchat combined this year.  Move over…. Facebook!

Snapchat, despite its initial success, has similar audiences, and better retargeting abilities than Tiktok has fallen behind. This year, Snapchat’s CEO warned employees that the company would underperform in targets for revenue and adjusted earnings in this current quarter. So why is Snapchat failing while other companies succeed?

Aside from recent macroeconomic issues plaguing the industry, Snapchat’s primary focus through the years has been on changes to the interface and making the app more user-friendly. These changes reverberated negatively and prompted outrage at the app’s creators as well. Snapchat has also failed to attract older users. 

Video content has maintained its position as the top-performing ad content of late, and yet Snapchat continues to be unappealing to advertisers.  We will see what the future has in store for Snapchat and other social media platforms, but it’s easy to see how fast-paced and ever-changing the digital advertising landscape can be.

DTC and performance marketers need to be ahead of the curve on these trends to reach out to consumers at the right time on the right platform with the right offer and the right content.

How are DTC brands harnessing data and personalization?

How are DTC brands harnessing data and personalization?

Personalization is a highly discussed topic within digital advertising as it continues to evolve and become more widely utilized. It can involve various efforts of individualization but has become quite controversial in recent years due to the amount of user data it requires. Personalization can help Direct to Consumer (DTC) advertising efforts immensely; however, media and advertising big leagues Google and Apple have some pretty contrasting things to say about it, especially regarding privacy.

Google has been adamant that its usage of user data for personalized advertising and marketing efforts is here to stay. They’ve implemented new programs for users to have complete control of the ads they see through a “My Ad Center” program. They believe being transparent with consumers to the point of selection and determining what they see will pay off and deliver better results. Although using user data is helpful for DTC brands looking to yield ROI, personalization can be about establishing a strong consumer relationship with the brand instead of just focusing on which ads people want to see.

Tech giant Apple takes a different approach. They insist that users don’t want companies tracking them. They also claim users who are not tracked are targeted just as effectively conversion-wise. A recent study by Apple saw a 62.1% conversion rate for users who opted into personalized ads and a 62.5% conversion rate among consumers who have tailored ads blocked. They are even pushing developers to target users with personalized ads turned off, as they have a higher conversion rate. 

Personalization helps DTC brands build closer connections with customers by better curating their products and messaging to a customer’s needs. This is especially imperative for DTC brands as opposed to standard CPG brands. But in regards to achieving success within your advertising campaigns, utilizing simple yet accurate data about your target market can help you stand out from the crowd and make your product the clear choice in a digital-first environment. 

A Merkle report found that from 2020 to 2021, consumers became more comfortable, not less, sharing data with brands in exchange for a more personalized experience. But not all data is regarded the same; most consumers are willing to part with information such as gender and age, but internet users overwhelmingly prefer to hold onto some other data, including browsing behavior. DTC brands need simple yet accurate data to ensure everyone within their targeted audience receives relevant messaging, even if their ad personalization is off. 

How Will Streaming Ads Benefit DTC Campaigns?

How Will Streaming Ads Benefit DTC Campaigns?

As the economy worsens and inflation rises, the relationship between audiences and the media they consume has begun to erode and continues to change. Despite the success and growth achieved by some streaming services, US consumers remain unsatisfied when it comes to the perceived value of the services.

A new report from Tivo reveals that 65% of the US public is willing to tolerate commercials on streaming platforms in exchange for free TV services. This number has risen from a previous 43% in 2020 and provides a valuable insight into the consumers’ relationships with video advertising. This increase contradicts the previous actions of many streaming services, such as creating new platforms altogether or adding a ‘premium,’ ad-free service subscription at a higher price. Statistics show that customers are less interested in paying a premium price for ad-free entertainment and would rather pay lower costs with commercials.

What does this mean for advertisers? Well, it’s good news for those utilizing video ad content or those looking to expand their marketing mediums, as the increase in ad space could mean lower costs and higher accessibility and more eyeballs viewing the direct to consumer video advertising. DRTV and infomercial marketers have yet to leap in with both feet on the streaming side, but the more platforms offer advertising options, the higher the chances that the still-high average CPM of $40 to $50 will drop.

This drop would provide direct to consumer marketers with much-needed TV reach that has been continuously eroding on linear TV networks. OTT allows for individualized advertising content on different viewers’ TVs while they watch the same content, ensuring targeted ad delivery and much more efficient ad spend. OTT advertising accounts for 51% of OTT marketing revenues already, and any advancements could contribute to more revenue for both the streaming platforms and advertisers.

Video content consumption is rising in all age ranges and target markets, and streaming platforms are more able to adjust their advertising capabilities to meet the changing needs and trends. The most significant projected increase in streaming video consumption is predicted to be among the 45-54 age group, a prime demographic especially for the DRTV products and services.

Netflix seems to remain in the loop with the ever-changing needs of its audience and has announced that it plans on running ads soon, confirming what many media and TV analysts have been predicting for some time now. This addition could open the doors to many innovations and opportunities for advertisers and streaming platforms alike and continue to shape the direct to consumer advertising industry.

Authenticity Reigns in Production

Authenticity Reigns in Production

One crucial marketing lesson learned during the pandemic was that flashy, glitzy, big-budget production did not necessarily win over the consumer. Another lesson learned was the power of video in all direct-to-consumer, DRTV, and social media outreach.

Authenticity in video communication is a critical factor in earning the customer’s trust and making conversions and sales.

Research has shown that what consumers value above all else are authenticity, transparency, and humanity. This is good news for marketers, especially in the DRTV and direct-to-consumer worlds, as tactics they’ve used for years, including testimonials, are scoring big digital ads. Additionally, it can be kinder to budgets as well. User-generated content, or even content that appears to be user-generated, can also reap huge rewards.

Authenticity will capture peoples’ attention and keep it. People want to watch videos that feel genuine, where it doesn’t feel like a company is immediately trying to sell you something.

The quality of the product and the message behind the ad are most important to consumers, rather than the latest equipment or massive sets. They value integrity and look for shared values between brands and the companies behind them. Avalanche has actually created top-performing ads on multiple platforms this year shot on an iPhone.

According to HubSpot Research, consumers prefer lower quality, “authentic” video over high-quality video that seems artificial and inauthentic.

So the next time you are gearing up for ads, think about content over fluff, authenticity over slickness, and humanity above all.

Boomers: Overlooked by Advertising for Too Long

Boomers: Overlooked by Advertising for Too Long

With the advertising world gravitating to more and more digital plays, many marketers put their focus on Millennials and Gen Z to take center stage as the most valuable consumer groups, but they could not be more wrong.

Although apps like TikTok, Facebook, and Instagram have pushed spend for advertising targeting younger age groups, undervaluing Boomers and their potential spending power is a huge mistake.

According to new research from the Federal Reserve, people aged 55+ control 70% of all personal wealth in the US. This often makes them the underdogs of potential target audiences, as they can get overlooked by advertisers wanting to age down their brands in hopes of staying trendy. Surveys from the Bureau of Labor Statistics reveal that 56% of new cars are being purchased by older adults, 55% for personal care products, 65% for healthcare, and 68% for home maintenance.

So why are advertiser dollars to Boomers so misappropriated? And how can advertisers leverage their preferences and insights to engage this demographic?

Folks aged 55 plus are also quite digitally savvy. In fact, research has shown that Boomers spend just as much time online as Gen Z. They are also spending more and more of their money online, making them a valuable focus for digital advertisers. In fact, during the pandemic, consumers aged 65 and over became the fastest group of online shoppers, citing data from the NPD Group’s checkout tracking. These consumers spent an average of $1,615 online from January to October 2020, rising by 49% in that year alone. Today, 90% of Boomers shop online, versus 89% in-store, outnumbering Gen Z by almost 20%.

Not only does this very appealing age group purchase online, but they also watch TV, and they actually read. Thus, DRTV offers, print, and direct mail are also very viable advertising vehicles to capture the discretionary spending of this important demographic.

Advertisers have neglected Boomers for far too long. With their collective wealth and vastly underestimated online presence, marketers should allocate appropriate spending to address and engage this hugely valuable consumer segment in all available media outlets.

DTC Health and Wellness Advertising on the Rise

DTC Health and Wellness Advertising on the Rise

The global pandemic sent some advertising categories soaring while bringing others to a screeching halt. OTC (Over-the-counter) healthcare spending has surged after increased demand for healthier practices and health awareness brought on by the COVID-19 pandemic.

Consumers are more aware and concerned about their health than ever before. The disruption of traditional OTC distribution channels has opened up countless possibilities for DRTV, infomercial, and digital advertising to promote health products.

Dietary supplements and nutraceuticals are enjoying steady market growth.  This market was worth $353 billion in 2019 according to Grand View Research. There were over 70,000 published articles in PubMed between 2010 and 2020, further validating the benefits of highly studied, powerful ingredients contained in dietary supplements.

To illustrate consumer demand for nutritional supplements, sales increased 5% in 2019 and over 44% in 2020. Consumers are, more than ever, becoming proactive about their health, both from a preventative and restorative standpoint.

Direct-to-consumer advertising of benefits for clinically studied nutritional supplements could be huge for marketers in 2022 and beyond.

The OTC game has changed entirely, and consumers today are more comfortable purchasing OTC products online than ever before, creating new opportunities for growth in advertising, brand awareness, and performance. Pharmacies and supermarkets also face added competition from these online retailers, as they can provide personalized, meaningful content and real-time information, making for a better user experience altogether.

Will DRTV Advertisers Cut the Cord in 2022?

Will DRTV Advertisers Cut the Cord in 2022?

After two years of double-digit rating declines, many in the industry are questioning the longevity of traditional television advertising in all lengths, both long and short form DRTV. If there’s one thing everyone in the DRTV industry can agree on: 2020 changed everything. During the pandemic’s first waves, advertisers, like so many others worldwide, were uncertain or scared about the future. The pandemic may have led to unprecedented change, but many underlying trends began long before COVID-19.

Today, the gap between those who view streaming services as an addition rather than a replacement and those who only use streaming services is quickly closing. According to an MRI-Simmons study, the two percentages went from 55% and 45%, respectively, to 51% and 49%. 5.5 million households also canceled pay-TV services offered by the top five providers last year, compared to 5.8 million in 2019. More than 4 in 5 households subscribe to at least one video-on-demand service. Respondents who made the switch to streaming only or plan to do so report that their main reason for doing so is to watch streaming services instead. A quarter of the respondents said that their TV packages are too costly and blamed prices. More than 43% of respondents claim streaming is the more cost-effective option.

Ad spending on smart TVs and streaming devices saw massive growth in 2020. | Image: IAB

These shifts are causing similar waves within advertiser spending, with companies beginning to allocate more to streaming. For the time being, traditional tv remains, along with many questions surrounding its future within the media world that remain unanswered, for now.

DTC Marketers: Don’t Ignore TikTok ROI

DTC Marketers: Don’t Ignore TikTok ROI

Hand holding iphone with TikTok opened

Tiktok has been named the fastest-growing social media platform of all time, by Forbes. And no, it’s not just for teens. The app has over 1 billion users of all ages across the globe, making it the most explosive social media app to use and advertise on. 

In fact, according to Backlinko, 31.3 % of TikTok users are over 40.

(Source: Backlinko.com)

Tiktok works using a personalized algorithm, which updates as you view, like, and save content. The app learns your preferences and feeds them directly into your “For You” or home page.

Like Instagram and Facebook, paid content is placed within your feed based on its relevance to you and how the advertisers refine their audience.

TikTok trends can be followed, allowing the potential for advertisers to connect with this massive potential audience in a way that feels authentic to users. Smart use of creative as well as hashtags allow for targeting both behavioral and geographic.

The difference between paid and organic content can be difficult to determine, which is especially great for advertisers. And with less competition than Facebook, clicks can cost up to a third of what they are on other platforms.

This makes TikTok an excellent vehicle for DTC advertisers. Because of Tiktok’s massive reach, ads utilizing lead generation for high ticket items or services allows clients marketing those products or services huge ROI. 

Avalanche CEO Ava Seavey says, “The huge return on TikTok advertising for our clients (one is seeing a 30 to 1 return) are stats I have not seen since 1980’s infomercials. It is the most exciting platform for DTC ROI I’ve seen.”

Here are some helpful tips to consider before utilizing TikTok to advertise:

Don’t only make ads. Make TikToks – This is crucial. If you’re going to make the leap into TikTok, you must be ready to produce content that feels native to the platform. Don’t just use existing content from Facebook and Instagram Stories. Slideshows, static images, and slick content are automatically detected as advertising and decrease viewer interest.

Song/sound selection – The use of songs and sounds matters more on TikTok than on any other platform. Another great benefit as opposed to Facebook/Instagram where most users view with the sound off. TikTok users watch with sound.

(Source: Backlinko.com)

Regarding influencer culture on the app, TikTok has an engagement rate of 5.30% on accounts with over 100,000 followers, compared to 1.10% for Instagram and 0.30% for Twitter. It has quickly become one of the main avenues for influencers and micro-influencers to recommend products through testimonial-style videos, Amazon Marketplace affiliate link programs, as well as trendy, creative, or niche videos of any kind.

(Source: Backlinko.com)

The app’s fast-paced nature keeps its users engaged for relatively long periods. With an average session length of 10.85 minutes, it has become the most engaging social media app out today. (Source: Backlinko.com)

For DTC marketers who may be experiencing declining ROI on Facebook, TV, radio, Amazon or other avenues, TikTok can bring you immediate sales and leads and if you get out there before your competition does, you will have even better results.

Buy Now, Pay Later Levels Playing Field

What BNPL is, and how it affects DRTV and DTC

BNPL Buy now pay later online shopping concept.Hands holding mobile phone

The explosion of e-commerce has not only changed the way we buy but how we pay. When the pandemic hit and millions of users flooded to online retailers, several already-existing businesses and ideas were thrown into full gear as they gained popularity. Buy Now, Pay Later, or BNPL, is an installment loan utilized by many online retailers today. With Klarna, Afterpay, Affirm, or simply retailers offering their own plan, BNPL allows consumers to make a purchase and receive it immediately while paying for it over time through a series of installments.

Some plans can come with interest and late fees, but some charge neither. Pricing and plan information varies from company to company.

Allowing a consumer to pay over time can dramatically alter the consumer landscape for marketers. It will give those with poor credit or lack of credit card funds an opportunity to purchase impulse products advertised to them. It also gives marketers a chance to close more sales at minimal risk.

Data shows that consumers buy more when they can pay over time. BNPL gives companies a much wider reach and the ability to expand their target audiences further.

BNPL Buy Now, Pay Later Written on Green Key of Metallic Keyboard. Finger pressing key.

A recent survey found that 1 in 5 U.S. consumers used a BNPL service in the 12 months ended Aug. 20, 2021, and only 1 in 6 of them regretted doing so. 

While this is a boon for marketers with higher price point items, full disclosure of terms is mandatory. In December 2021, the Consumer Financial Protection Bureau announced an inquiry into BNPL, expressing concern about “debt accumulation, lack of regulation, and data harvesting.” The regulator is concerned that borrowers are accumulating too much debt and that consumers’ personal data could be misused.

Last month, the agency demanded information from a handful of the industry’s most prominent players, including Klarna and Afterpay. 

This inquiry notwithstanding, the BNPL option has opened up an excellent opportunity for higher price point items and allows credit-challenged consumers to have an equal playing field for products that otherwise may have been out of reach.