How Digital Marketers Can fight Facebook Ads inflation
Jun 27, 2018
10 min read
After the Cambridge Analytica scandal, Facebook has been trying to regain credibility amongst their users ever since. Dropping the gauntlet on brands, they decided to marginally reduce the visibility of branded content on news feeds and favour posts from friends and family instead. This was done to reduce the time people spend on Facebook, but made each moment spent on the platform more valuable and engaging at the same time. Less time spent on Facebook usually results in people seeing fewer ads. And with fewer ad impressions, ad pricing is bound to rise with every brand advertising on the platform. Currently, that is exactly what’s happening with Facebook. With their news feed running out of space for more ads, increasing the price of ad impressions is the next best thing to do to keep the dollars coming in.
Almost 72% of marketers actively run Facebook Ads for engaging their current and building new audiences. When it comes to social media marketing, It indeed is the best way to gain some serious online exposure for businesses. So much that some business owners rely solely on Facebook Ads to make sales. But after the update, advertisers will now have to pay twice as much for an ad to gain the same level of exposure as it used to before and still may not get satisfactory results.
So, what’s next for marketers?
Understanding the new algorithm can help you greatly in preparing yourself to make your advertising efforts work on the platform. Also, you can make use of some other methods to rise above the noise and get seen. Let’s look into some of them -
Aim for active engagement
In the wake of this new algorithm, Facebook ranks those posts first in the news feed which are high on active interactions. Active interaction is when your users share and comment on your post. On the other hand, passive interactions are likes and click-throughs.
Understanding this will help you re-access your entire facebook marketing strategy and develop the kind of content that would garner a ton of active interactions.
And providing relevant content that is of some value to your fans is the number one factor that can get you those. Getting these signals early also determines your place in the news feed. Get them early and your post will soon be at the top.
Make use of Influencers and Facebook Groups
The new Facebook algorithm downranks branded content. One simple way to get around that is by teaming up with authoritative influencers in your industry. Or you can create a ‘Facebook Group’ for your brand and share updates on that group to stand out from the clutter in news feeds. On top of that, Facebook is working on enhancing the features it provides to marketers for both the above mentioned ways.
Let’s talk about influencer content first. It’s a proven fact that people trust influencer content more than what brands have to say about themselves. So, bringing some nice influencers on your side won't hurt you a bit. But how do you find them? Apparently, Facebook is working on their own influencer search engine tool to foster relationships between brands and influencers and will soon roll out globally.
Another way to game this new algorithm update is by creating an open group of your brand and publish content there to gain quick engagements as group members usually receive a notification when there is some activity in a group. Moreover, marketers now have an option to place a pixel in their groups as well that would help them track in-group activity, information on user growth and engagements with their website.
Switch to Instagram
After the Facebook algo-update, many marketers switched to the next best thing - Instagram, for all their advertising purposes.
Instagram boasts some of the highest user engagement numbers when compared to any other social media platform out there and you can definitely use it to your advantage. According to me, the Facebook Ad’s declining impressions issue is not going to go away anytime soon. As more brands flock to Facebook for building their own audiences, the ad space will only get more cluttered in the time to come.
So, exploring other advertising options for your brand other that Facebook seems like the next best thing to do to tackle the issues its been facing lately and Instagram is currently the next best thing out there for you if you are looking to get a great ROI on your advertisement spend.
So, how are you coping up with Facebook’s declining organic reach and reduced ad impressions? Let us know in the comments.
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Why You SHOULD Blog
Do you know what is easy, free, and a potentially valuable tool for marketing your business and reaching a more extensive base of audience? BLOGGING! The web world is brimming with the blogs in different niche helping resolve issues of a vast range of consumers. But have you ever sat down for a second to think about its purpose and why the digital marketplace goes gaga over the concept of it? Allow us to guide you through it! A well-written blog: Helps drive quah2ty traffic to your website Choosing a niche and reh2giously writing an authentic piece with all the essential elements such as meta descriptions, subheading, statistics, visuals (images, videos, meme) will attract a quah2fied audience, helping your blog reach out to a plethora of people browsing the web. If the blog section of your website regularly post informative and relevant blogs that address the pain points of the customers and adds value to their h2fe, it can help drive enormous traffic to your website. Helps convert that traffic into leads By writing about a meaningful and relevant topic that gives your audience a solution to the problems can help estabh2sh you and your brand as an authority in the community. The rapport and engagement thus build the potential to convert the traffic into leads and leads into customers. Helps with the overall development The economy is getting increasingly competitive. What could be a more creative way to communicate with new people, tell your story, impart knowledge and at the same time, vah2date your expertise in a particular niche to open possibih2ties for financial gain than a blog? Yes, sincere efforts towards blog writing can yield positive results. How to get the best results from a blog (that nobody reads) It is only natural to get perturbed by scrolh2ng through well-detailed blogs and looking at the figures of h2kes, shares, and comments and wonder where despite profound research and investing considerable time, and energy are you going wrong? What a blog does NOT do There are several misconceptions in the blogging community regarding what a blog does and does not do, and we have h2sted down three misconstrued objectives about the blog: It does not sell The aim of a blog is to educate a set of the audience about the latest happenings in the concerned industry. People read a blog with the motive of finding solutions to their problems. If they had to look for a product, they would just easily search it on any search engine. They should be used as a platform to express your thoughts and opinions and not be all sales-pitchy. Your blog should be able to add value to the h2fe of your readers. It's not about quantity While the market is abuzz with creating blogs above 2000 words to get recognized, it is worth keeping in mind that a blog is not always about quantity. If you can explain a concept with a different take creatively and concisely, then there is no need to drag it to a standard set. While long-form posts help educate the visitors more profoundly, short-form posts can be a user's savior as a quick fix solution. It will not help you become a blogging sensation A blog alone can not help you estabh2sh as a maestro unless you have marketed it well. Good social and marketing skills can help you become a star blogger. You need to be absolutely clear on one thing: blogging results are not instant, and your continuous efforts will gradually help it gain a larger audience and more visibih2ty. Why is no one reading your blogs? Chances are you, h2ke many, beh2eve that all you need to do is create a blog section and periodically write, and the crowd will automatically visit. If so, then you are highly mistaken. This approach only screams of gradual doom. If you are struggh2ng with traffic, audience's attention, maybe you are doing it wrong. We have compiled a h2st of reasons as to why no one is reading your blog so that you can improve your blog section and avoid these blunders in the future: It is all about you: Admit it! If your blogs talk more about what makes you and your business worth investing in, at a stretch, periodically, no one is going to read and recommend it. The aim of blogging, as discussed above, is to educate the target audience and helping them find the solution through your products and services. When you say, you want to be a part of the onh2ne community and help people by sharing relevant solutions, man it and prove it through your blogs. You overlook the presentation: While we are all for "ultimately it is the quah2ty of the content that matters', what actually convinces users to read the blog? Yes, you have guessed it right! A catchy headh2ne and well-presented blog in a proper syntax with emphasis on invoking the right emotions. Yo need to invest in making your blogs visually -appeah2ng to hold their attention in the initial second, or you'll end up losing customers. Don't waste your time coming up with over the top or overused titles. Creare relevant and relatable titles with which your audience can quickly estabh2sh a connection. You are using the wrong style and tone: You can't just use a casual tone when you are talking about automated software, but you sure can add "slang" to a traveh2ng or h2festyle blog, because that is how you will connect with the right crowd. The style and tone in which you create your blog need to be ah2gned with the industry in which you are serving and the characteristics of your target audience. While those mentioned above are crucial, there are many other aspects that you need to work on to get as many people to read your blog such as- adding visuals to enhance engagement, creating valuable content, periodically testing the parameters for success, strengthening your research skills, focusing on mobile responsiveness. Now that you are well-aware of why every business, big or small invests in creating and developing a blog section when are you planning to start? ...
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ROAS Marketing for B2B: Proven Strategies for Higher Returns in 2025
Even after spending on ad campaigns, businesses don't see the results. Are you experiencing the same? If your ad campaigns aren’t delivering the expected revenue, it’s time to focus on Return on Ad Spend (ROAS). If you invest in paid ads through platforms like Google Ads, Facebook Ads, LinkedIn Ads, or Instagram Ads, tracking ROAS can help you optimize your campaigns, allocate budgets efficiently, and maximize profitability. This blog will cover everything you need to know about ROAS, including its definition, importance, calculation, industry benchmarks, and actionable ways to improve it. What is ROAS? ROAS (Return on Ad Spend) is a key performance indicator (KPI) that measures the revenue generated from advertising spend. It helps businesses determine whether their ad campaigns are profitable or need optimization. ROAS = Revenue from Ads / Ad Spend Marketers track organic ROAS to compare marketing efforts, but it’s harder to measure due to multiple factors. In contrast, paid campaigns are easier to track through ad platforms. You can also get immediate results with our Google Ad consultancy services. For B2B companies, measuring ROAS is more complex than in B2C due to: Longer sales cycles requiring nurturing before conversion Higher acquisition costs due to competitive bidding on platforms like LinkedIn Multiple stakeholders involved in decision-making The table below shows the average ROAS marketing performance across different channels: Average ROAS by Channel For Paid Channels: Channel ROAS PPC/SEM 1.55 Online PR 1.6 Facebook Ads 1.8 Influencer Marketing 3.45 LinkedIn Ads 2.3 For Organic Channels: Channel ROAS SEO 9.1 Email Marketing 3.5 LinkedIn Organic 2.75 Webinars 4.95 Why ROAS Matters in B2B? ROAS is one of the most critical performance metrics for B2B businesses running digital ad campaigns. It provides actionable insights that help optimize advertising efforts. Here’s why ROAS is essential for every business: 1. Measures Ad Effectiveness ROAS helps businesses determine whether their ads generate enough revenue to justify ad spending. 2. Optimizes Budget Allocation A high ROAS marketing performance means your ad spend is being used efficiently. By analyzing ROAS across different campaigns, businesses can shift their budget toward the highest-performing ads. 3. Helps Refine Targeting and Strategy If your ROAS is low, your targeting, ad copy, or offer might need improvement. 4. Increases Business Growth By maximizing ROAS, companies can reinvest in high-performing campaigns, leading to higher revenue and long-term growth. 5. Evaluate the Performance of Different Ad Channels ROAS allows businesses to compare ad performance across platforms like Google, Facebook, LinkedIn, and TikTok to determine the most profitable ones. How do you calculate ROAS? Return on Ad Spend is calculated by dividing your Conversion Value (revenue) by your Spend. The formula to calculate ROAS is: ROAS = Total Revenue from Ad Campaign/ Campaign Spend Revenue from Ads: How much money you’ve made from your conversions. Example Calculation: Suppose you spend $2,000 on Google Ads. Your campaign generates $8,000 in revenue. Your ROAS = $8,000 ÷ $2,000 = 4:1 (or 400%) This means that for every $1 spent, you earned $4 in return. What are the Pros and Cons of using ROAS? Pros of ROAS 1. Identifies Profitable Campaigns ROAS helps businesses track which ads are driving the most revenue. By analyzing ROAS, businesses can: Identify which platforms (Google Ads, Facebook, LinkedIn, etc.) generate the highest returns. Stop investing in underperforming campaigns. Scale up high-ROAS campaigns to maximize profits. For example, increasing the budget could drive more sales if a Google Ads campaign has a ROAS of 6:1 (earning $6 for every $1 spent). 2. Optimizes Ad Spend Companies can use ROAS to reallocate budgets toward more profitable ads. Instead of spending evenly across all campaigns, they can: Increase spending on high-performing ads. Pause or modify low-ROAS campaigns. Experiment with ad formats and targeting to improve efficiency. Say, if a Facebook ad targeting young professionals has a ROAS of 2:1, while an ad targeting small businesses has a ROAS of 5:1, shifting more budget to the second audience can improve overall returns. 3. Improves Decision-Making ROAS provides quick insights that help businesses make data-driven decisions, such as: Adjusting bids on keywords in Google Ads. Refining audience targeting based on performance. Testing different ad creatives and copy. 4. Provides Quick Performance Insights Get instant feedback on which ads are working. Make quick adjustments to improve efficiency. Test multiple campaigns and optimize in real-time. For example, an ecommerce store running Black Friday ads can check ROAS daily to decide whether to increase ad spending for better sales. Cons of ROAS 1. Does Not Show True Profitability ROAS only measures revenue generated from ad spend but does not factor in other costs associated with running a business. Even if an ad campaign has a high ROAS, a business could still be unprofitable if its overall costs are high. 2. Ignores Customer Lifetime Value (LTV) ROAS focuses only on immediate revenue from an ad campaign without considering whether customers will make repeat purchases in the future. This can lead businesses to undervalue ads that attract high-quality, long-term customers. 3. Varies by Industry What’s considered a "good" ROAS depends on the business type, making it unreliable as a universal success metric. Example: Ecommerce brands typically aim for a ROAS of 4:1 or higher because they rely on direct sales. Subscription businesses may accept a ROAS of 2:1 because they recover costs over time through recurring revenue. Luxury brands may have low ROAS but high-profit margins, making their campaigns successful despite lower ad efficiency. Your Ad Spend Deserves Better Results We help you unlock high-performing B2B campaigns with data-driven ROAS marketing. Optimize, scale, and convert with precision. Get Started 9 Key B2B ROAS Marketing Strategies 1. Improve Audience Targeting Your ads will only perform well if they reach the right audience. Targeting a broad or unqualified audience can waste ad spend and lower ROAS. To improve targeting: Use demographic targeting (age, gender, location, income) to reach your ideal customers. Leverage interest-based targeting in platforms like Facebook and Google Ads to focus on people who engage with similar brands. Use behavioral targeting by analyzing past website visitors and purchase history. Implement lookalike audiences to find new users similar to your best customers. 2. A/B Test Ad Creatives Testing different elements helps identify which headlines, images, videos, and CTAs resonate most with your audience. Test different headlines (question-based, benefit-driven, urgency-based). Experiment with varied CTAs (e.g., “Shop Now” vs. “Get Yours Today”). Compare static images vs. video ads to see which drives better engagement. Use different ad formats (carousel, single image, slideshow) to test performance. 3. Optimize Landing Pages Even the best ad won’t drive sales if your landing page is slow, unresponsive, or not persuasive. A poor landing page experience increases bounce rates and lowers ROAS. How to optimize landing pages: Improve page load speed (Google recommends under 3 seconds). Ensure mobile-friendliness, as over 50% of traffic comes from mobile users. Use a clear headline and CTA to guide visitors toward conversion. Reduce distractions by keeping the design clean and eliminating unnecessary links. Add trust signals (customer reviews, security badges) to increase confidence. 4. Adjust Bidding Strategies The wrong bidding method can lead to high ad spending with little return. Best bidding strategies for ROAS: Use Target ROAS bidding in Google Ads to automatically adjust bids for better returns. Choose Maximize Conversions to get the most conversions within your budget. Utilize manual CPC (cost-per-click) bidding if you want full control over bid adjustments. Adjust bids based on device performance, prioritizing platforms that drive more conversions. 5. Focus on High-Performing Keywords Not all keywords are profitable in search advertising. Some drive traffic but result in low conversions, wasting your budget. To improve keyword strategy: Identify high-ROAS keywords and increase bids on them. Pause or remove low-performing keywords that generate clicks but no conversions. Use negative keywords to prevent wasting spend on irrelevant searches. Focus on long-tail keywords, which tend to have lower competition and higher conversion rates. 6. Use Retargeting Ads Most visitors don’t convert on their first visit but may be interested in your product. Retargeting ads bring them back and increase conversion rates. How to use retargeting: Retarget users who abandoned their cart with discount or reminder ads. Show personalized product recommendations based on what they viewed. Use dynamic remarketing to display the exact products visitors showed interest in. Set frequency caps to avoid ad fatigue and prevent annoying potential customers. 7. Optimize for Mobile Users With over 50% of online traffic coming from mobile devices, businesses that don’t optimize for mobile lose potential customers and lower ROAS. How to Improve Mobile Experience: Use mobile-friendly ad creatives (larger fonts, vertical video, thumb-friendly CTAs). Avoid long forms and simplify checkout for faster mobile conversions. Make sure buttons and links are easy to click on smaller screens. 8. Shift Budget to High-ROAS Channels Some advertising platforms perform better than others, depending on the business and audience. Tracking channel performance helps allocate the budget effectively. How to allocate budget wisely: Identify top-performing platforms (Google Ads, Facebook, TikTok, LinkedIn) based on your industry. Reduce spend on low-ROAS channels that don’t drive conversions. Increase investment in ads with the highest engagement and conversion rates. Use multi-channel attribution to see how different channels contribute to overall sales. 9. Leverage Video & Dynamic Ads Video and interactive ads often drive higher engagement and conversion rates than static images. How to use video & dynamic ads effectively: Use short, engaging videos (under 30 seconds) to capture attention quickly. Test carousel ads to showcase multiple products in a single ad. Implement dynamic product ads (DPA) that automatically display the right products to the right audience. Add captions to video ads since many users watch on mute. 10. Target High-Intent Audiences Instead of broad targeting, focus on decision-makers and high-intent users actively searching for solutions. How to implement: Use LinkedIn Matched Audiences to retarget website visitors and CRM contacts Run Google Search Ads with high-intent keywords Leverage Account-Based Marketing (ABM) to target specific companies Outcome: Higher-quality leads with a better chance of conversion. 12. Implement Multi-Touch Attribution for ROAS Optimization Since B2B leads interact with multiple touchpoints, tracking every touchpoint is essential. Multi-Touch Attribution Models: First-Touch Attribution – Credit goes to the first interaction Last-Touch Attribution – Focuses on the final conversion source Linear Attribution – Distributes credit evenly across all touchpoints Data-Driven Attribution – Uses AI to assign value to touchpoints Outcome: More accurate insights into what’s driving revenue, allowing smarter budget allocation. Why Choose Saffron Edge for ROAS Marketing in B2B? Saffron Edge specializes in data-driven B2B marketing to help companies optimize ROAS and drive high-value conversions. Our approach includes: Advanced Audience Targeting: Identifying and reaching decision-makers with precision AI-Powered Ad Optimization: Running smart campaigns with AI-driven insights Conversion-Focused Landing Pages: Custom-built for maximum lead generation Attribution Modeling Expertise: Multi-touch tracking to measure campaign impact Full-Funnel B2B Strategies: Combining paid ads with email, SEO, and content marketing Through data-backed marketing strategies, we help businesses reduce wasteful ad spending, improve conversion rates, and achieve sustainable growth. ...
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How is the DTC Cosmetics Industry Moving in 2025?
Direct-to-consumer (DTC) brands revolutionized the global DTC fashion & apparel industry, propelling names like The Ordinary, Harry's, and Fenty Beauty to unprecedented heights. Yet, as we step into 2023, the landscape has undergone a seismic shift. NielsenIQ's illuminating analysis reveals a dip in U.S. DTC beauty sales, citing factors from an abundance of offerings to the impact of iOS 14 privacy regulations. However, amidst this evolution, pockets of growth and uncharted opportunities persist. The bath and shower sector saw a 6.3% surge, while cosmetics and nail grooming soared by 33.2% in the 12 months leading up to October 30, 2022. Fragrances and hair care too, experienced robust DTC growth potential, marking a resurgence in select segments. This transformation prompts a critical question: How can DTC brands survive and thrive amidst unprecedented competition? We offer a roadmap, highlighting the power of personalized products, diagnostic quizzes, subscription models, and sustainable offerings in capturing consumer loyalty. The rules governing the past no longer hold sway. In 2023, learning and mastering the new rules will be the linchpin of brand success in the ever-evolving world of DTC beauty marketing. What is a DTC Beauty Brand? A "DTC beauty brand" refers to a company that opts to sell its products directly to consumers, thereby minimizing overhead costs and bypassing outside influences involved in distribution or operations. This approach has enabled these brands to cultivate meaningful connections with potential customers through e-commerce platforms and social media, facilitating direct product sales. There are three primary forms of DTC brands: those that originated online and exclusively sell online, exemplified by brands like Glossier or Madison Reed; multi-level marketing (MLM) firms such as Monat or Rodan + Fields, which utilize a network of individual sellers; and the online presence of established brands, like the e-commerce offerings from Kiehl’s or Clinique. The Scope of DTC in the Beauty Industry The scope of the DTC market in the beauty sector is immense. It has only grown in the last years, and if the past is any testament, it shall only continue to expand further. Below, we shall discuss the recent DTC fashion & apparel industry trends with you. Trends in DTC Beauty Brands Several trends are making waves, transforming the way consumers engage with personal care and cosmetic products. Let’s take a look at them; AI & VR Try-On Experience: To bridge the gap between online and in-store shopping, the beauty industry has harnessed the power of Virtual and Augmented Reality. Sephora's Virtual Artist app, for instance, allows customers to virtually 'try on' products, enhancing engagement and reducing return rates. This technology has led to a 1.6x increase in purchase likelihood and a 2.7x surge in spending for app users compared to non-users. Hyper Personalization: It's not just about discounts; hyper personalization involves delivering precise messaging at pivotal moments in a customer's buying journey. ILIA Beauty, for example, saw a nearly twofold increase in email open rates by automating product replacement reminders based on individual purchasing intervals. This trend caters to evolving consumer preferences for tailored experiences. Beauty Subscription Boxes: The subscription box model is booming, particularly in the beauty sector, which witnessed a 20% surge in Average Order Value (AOV) in 2020. Birchbox, a pioneer in this space, offers curated monthly selections of personal care products for just $15. This trend addresses the need for consumers to sample diverse products without committing to full-sized versions. Influencers & Brand Partnerships: Social media remains a potent tool for beauty brands, driving them to utilise micro-influencers and forge strategic partnerships for broader reach. Besame Cosmetics' collaboration with Disney, recreating Mary Poppins' iconic lipstick, exemplifies the power of cultural tie-ins to resonate with diverse consumer segments. Diversity & Inclusion: Recognizing the importance of representation, consumers are increasingly drawn to brands that champion diversity and inclusivity. In fact, 63% of Americans are inspired by health and beauty brands that prioritize these values. Sephora's '15% Pledge' to allocate shelf space to black-owned beauty brands underscores the industry's shift towards greater inclusivity. AI-Driven Product Discovery: Artificial Intelligence is revolutionizing product personalization, with brands like Dcypher Cosmetics using AI in manufacturing to match products with consumers' unique skin tones. YSL's Rouge Sur Mesure device, powered by AI, creates thousands of custom lip shades, exemplifying the potential of technology in catering to individual preferences. These trends underscore a consumer-driven shift towards a more personalized, inclusive, and technologically enhanced beauty experience. Embracing these shifts can help DTC beauty brands meet and exceed the evolving expectations of their diverse customer base. Statistics on DTC Beauty In 2022, the DTC beauty market, encompassing skincare, fragrance, makeup, and haircare, saw a substantial surge, generating an impressive $430 billion in revenue. This meteoric rise is a testament to the industry's resilience, despite global economic challenges. What's more, this upward trajectory is poised to continue across all categories. Projections indicate that by 2027, the DTC beauty market is expected to reach a staggering $580 billion , with an estimated annual growth rate of 6 percent, aligning it with or even surpassing other prominent consumer segments like apparel, footwear, eyewear, pet care, and food and beverages. This buoyant DTC growth potential is drawing the attention of top-tier financiers and attracting A-list celebrities, all eager to partake in the flourishing DTC fashion & apparel industry. It's become a dynamic segment ripe for transformation, with an expanding range of products, channels, and markets on the horizon. This evolution will be chiefly driven by consumers, especially younger generations, who are reshaping their definitions of beauty and their perceptions of various elements, from sustainability to the role of influencers and key opinion leaders, to the significance of self-care. One of the remarkable trends within this landscape is the phenomenon of "premiumization." The premium beauty tier is anticipated to experience an impressive annual growth rate of 8 percent between 2022 and 2027, outpacing the 5 percent growth projected for mass beauty. Consumers are showing a proclivity for trading up and increasing their spending, particularly in fragrance and makeup. As the industry gears up for transformation, competition is expected to intensify. Independent brands that successfully entered the market over the past decade are now seeking to scale, while new challengers are also on the horizon. This heightened competition is prompting established brands and retailers to adapt. Responding to trend-driven dynamics, a significant 42 percent of consumers across key global markets express a keen interest in trying out new brands. E-commerce in the DTC beauty sector has witnessed a remarkable surge, nearly quadrupling between 2015 and 2022. Its current share exceeds 20 percent, with substantial room for further growth. This trajectory is attributed to several factors, including the expansion of beauty offerings by online giants like Amazon and Tmall, increased digital sophistication among direct-to-consumer players, and the growing significance of online channels for omnichannel retailers. E-commerce is expected to maintain its position as the fastest-growing sales channel, with a projected annual growth rate of 12 percent between 2022 and 2027. Nevertheless, traditional channels such as specialty retail, grocery retail, and drugstores are expected to experience a resurgence post-pandemic, driven by consumers' continued desire for in-store product discovery and trial. Strategic decisions regarding where to operate will be just as crucial as how to compete. Brands will need to reevaluate their global strategies and introduce greater nuance and tailoring to their approaches. Geographic diversification is poised to become more pivotal than ever. While China and the United States continue to wield substantial influence, individual brands may face tougher competition in these markets. This shift is opening up new opportunities in regions like the Middle East and India, presenting unique potential for specific categories and price tiers. This new paradigm will likely necessitate a diverse set of localized strategies. Overall, the DTC growth potential and market share of DTC beauty brands are poised for further expansion, driven by consumer preferences and dynamic market forces. Key players in the industry will need to navigate this evolving landscape strategically to maintain their positions and seize new opportunities on the horizon. Categories within DTC Beauty Skincare Challenges Product Differentiation: The skincare market is highly saturated, making it crucial for DTC brands to offer unique formulations or target specific skin concerns. Regulatory Compliance: Skincare products are subject to rigorous regulatory standards, necessitating compliance with various guidelines and certifications. Ingredient Transparency: Consumers increasingly demand transparency regarding ingredients, sourcing, and sustainability practices. Opportunities Personalization: Offering personalized skincare solutions through diagnostic tools and tailored product recommendations can set brands apart. Clean and Natural Formulations: There is a growing demand for clean, natural, and sustainable skincare products, presenting an opportunity for eco-conscious brands. Cosmetics Challenges Color Matching: Achieving accurate color representation online can be challenging, potentially leading to customer dissatisfaction upon receipt. Influencer Saturation: The cosmetics market is heavily influenced by beauty influencers, making it crucial for DTC brands to establish their unique voice. Seasonal Trends: Cosmetics trends can change rapidly, requiring brands to stay agile and responsive to consumer preferences. Opportunities Virtual Try-Ons: Utilizing AR and VR technology for virtual try-ons can enhance the online shopping experience and boost customer confidence. Inclusivity: Catering to diverse skin tones and preferences is essential to attract a wider customer base. Haircare Challenges Hair Type Variability: Haircare needs vary widely based on factors like hair type, texture, and specific concerns, necessitating a diverse product range. Efficacy Claims: Consumers are increasingly discerning about product claims, so brands must demonstrate the effectiveness of their formulations. Sustainability in Packaging: Haircare brands face pressure to adopt eco-friendly packaging solutions to reduce environmental impact. Opportunities Customization: Offering personalized haircare regimens based on individual needs and concerns can drive customer loyalty. Natural Ingredients: Embracing natural and organic ingredients aligns with consumer preferences for clean, sustainable products. Wellness Challenges Regulatory Considerations: Wellness products may have specific regulatory requirements, especially if they make health-related claims. Education and Trust: Consumers seek transparent information about the benefits and efficacy of wellness products, necessitating clear communication. Competitive Landscape: The wellness market is diverse and competitive, requiring brands to carve out a distinct value proposition. Opportunities Holistic Approach: Brands that offer a comprehensive range of wellness products, from supplements to self-care items, can cater to consumers seeking a holistic approach to well-being. Brand Partnerships: Collaborations with influencers or experts in the wellness space can lend credibility and expand reach. Growth Strategies for DTC Beauty Brands in 2023 Social and Paid Media Social media wields immense influence over consumers, especially in the beauty industry, with its whopping 71% impact on purchasing decisions. Optimizing social and paid media campaigns is paramount for beauty brands. The goal is to create an exceptionally personalized and exclusive experience for every visitor while maximizing the traffic generated. Here are four strategies to achieve this: UTM-Based Targeting Imagine tailoring your online presence to perfectly align with the content that enticed visitors to click through to your site. This approach involves meticulous synchronization between your social media, influencer collaborations, and advertising campaigns. Consider incorporating: Keywords from the post that lured them in. The enticing offer, whether it's a coupon code or a special gift. The product imagery used ensures continuity in visuals. Even the influencer's name enhances the connection. For instance, when using swipe-up links in stories, drive traffic to dedicated landing pages, which can even be full-page takeovers. These pages should prominently feature the referring influencer's name, image, and unique offer. This personalization deepens the visitor's emotional connection with your brand, making it an unforgettable experience. Tab—Click to Open Opt-Ins When it comes to engaging traffic from Instagram on your site, sometimes less interruption is more effective. Here's an innovative approach: implement a mobile traffic opt-in tab. This unobtrusive bubble stays discreetly at the corner of their screen, ready for them to explore whenever they're prepared. By not diverting their focus from your products, you maintain a seamless shopping experience. When they do click the tab, it effortlessly opens up a standard lead capture form for easy opt-ins, minimizing distractions. Limited Time/Exclusive Collaborations Beauty brands are increasingly launching mini-capsules inspired by their top influencers. This strategy works wonders for limited-edition products while aligning the influencer's dedicated audience with your brand. But why stop there? You can extend this approach beyond product releases. Consider streamlining the power of intelligent product recommendations. Create curated collections based on what these influencers use and recommend to their followers. Categorize and tag products as belonging to specific influencers. Then, seamlessly integrate these curated collections across your website. It's a strategy that fosters a deeper sense of connection between your audience and the influencers they admire. Audience Sync for Retargeting To truly supercharge your lead capture promotions, set up Audience Sync. This dynamic feature enables the automatic transmission of subscriber information to Google and Facebook audience managers. Why is this so powerful? It opens up a realm of possibilities, from retargeting specific audience segments to prospecting lookalike audiences. Showcasing additional creative content, such as social proof based on products previously browsed, is a masterstroke. It serves as a gentle nudge to move shoppers seamlessly down the conversion funnel, all while enhancing overall campaign performance. SEO For beauty brands, SEO Help DTC retail is crucial, especially with eCommerce sites featuring numerous product pages. Given that consumers are now 40% more open to trying new beauty products and brands post-pandemic, an impressive SEO Help DTC retail strategy is vital for maximizing brand visibility. Employing long-tail and semantic keywords in descriptions and images enhances the likelihood of dominating high-intent search results. Maintaining swift loading times and implementing a solid internal linking strategy is equally important. These factors collectively facilitate seamless navigation for shoppers, enhancing their overall experience and reducing bounce rates. Personalization For New Visitors: Homepage Bestsellers When a visitor is brand new to your site, making a strong first impression is crucial. The homepage serves as the digital storefront, and one of the most effective ways to captivate a potential customer is by showcasing your best-selling products. Strategically featuring your top-performing items helps you guide the traffic toward products with a proven track record. This not only boosts the chances of converting a first-time visitor but also minimizes the likelihood of them bouncing off without exploring further. For Returning Customers: Items Related To Past Purchases Or Abandoned Cart Contents Returning customers are an invaluable asset. They've already shown interest in your brand and products. To nurture this relationship, it's essential to provide them with tailored recommendations. Displaying items related to past purchases or products they've left behind in their cart is a gentle nudge toward conversion. It's a thoughtful touch that shows you value their preferences and are keen on making their shopping experience as seamless as possible. For Returning Visitors: Staff Favorites Engaging with returning visitors, especially those who tend to browse without making a purchase, requires a special approach. Consider introducing a "Staff Favorites" section. This unique messaging tactic establishes a personal connection by showcasing products that your team holds in high regard. This "expert" social proof can be the decisive factor that nudges a visitor towards making a purchase decision. It adds a human touch to the shopping experience, instilling trust and confidence in your brand. For VIP Customers: Early Access to New/Seasonal Products VIP customers are the backbone of any successful beauty brand. They deserve special treatment. Providing them with early access to new or seasonal products is a powerful strategy. This exclusive perk makes them feel valued and creates a sense of anticipation. To complement this, use backend tags to dynamically update the recommended products based on the season or new launches. It's a personalized touch that demonstrates your commitment to offering them the best and latest in beauty. Upon Add to Cart: Sample Options When a shopper adds a product to their cart, it's a prime moment to entice them further. Trigger a pop-up showcasing a carousel of free gifts or sample options. This adds value to their purchase and creates a sense of urgency. You're instilling a fear of missing out by emphasizing that they're receiving a complimentary gift. This subtle nudge towards conversion can significantly increase the chances of them completing the purchase. Retention Building strong customer relationships is key to creating brand loyalty, especially in the beauty and cosmetics industry. Implementing loyalty and subscription programs can be highly effective in transforming one-time buyers into loyal, returning customers. Subscription programs are particularly well-suited for the beauty industry due to the consumable nature of the products. Customers will eventually need replacements, making subscriptions a reliable source of recurring sales. While customers may not initially sign up for a subscription, targeting returning visitors with a pop-up offering a discount on their re-purchase when they subscribe can be a compelling incentive. In addition to subscriptions, loyalty programs play a crucial role in retaining customers. These programs focus on providing rewards and enhancing the overall brand experience. Offer perks like discounts, early access to products, seasonal savings, loyalty points, and birthday gifts to foster long-term customer retention. Consider introducing gamification elements to your loyalty program. This could include point systems that encourage specific behaviors, such as following your company on Instagram or referring friends. This approach not only engages customers but can also turn your VIP segment into micro-influencers, employing the power of word-of-mouth in the beauty industry. Creating a competitive leaderboard within your loyalty program based on lifetime spending can further enhance customer engagement. As customers spend more, they unlock progressively better benefits, creating a sense of exclusivity. Tangible benefits like free shipping and early access to sales can be as impactful as intangible benefits, such as feeling like a valued VIP. Use threshold banners to inform customers of how much they need to spend to reach the next tier, motivating them to make additional purchases. Lastly, implementing a sample strategy can be highly effective. Even in larger mini sizes, offering samples can encourage product discovery and diversify orders. This is particularly important in reducing barriers to purchase for customers who may be hesitant to commit to full-size products, especially if they are new to the brand. Gamify the sample experience by allowing customers to use their loyalty points to "purchase" exclusive minis or gain access to seasonal gifts before the general public. The possibilities for gamification in this area are limitless, as long as they align with what matters most to your customers, ultimately creating an enticing and irresistible experience. UGC Social proof stands as one of the most powerful tools to sway consumers' decisions. In fact, a notable 64% of shoppers actively seek out User-Generated Content (UGC) before committing to a purchase. For beauty and cosmetics brands, this dynamic is especially crucial, as customers typically require a wealth of information to confidently choose a product, often seeking the experiences of others who have used it. Using a UGC and reviews application like Okendo provides beauty brands with invaluable insights. Not only does it grant access to product attributes within reviews, but it also allows for the customization of these attributes for ratings. This means key selling points can be spotlighted, even if the reviewer didn't explicitly mention them. Furthermore, capturing additional information about the reviewer, such as skin type, concerns, and age, enhances conversions by helping new shoppers find reviews from individuals with similar characteristics. This alignment increases the likelihood of conversion, as potential buyers identify with someone who shares their profile. Taking things a step further, beauty brands can harness these ratings, reviews, and customer photos across various platforms. The cross-channel impact is maximized by showcasing them on social media, incorporating them into carousels on their website, and even featuring them in Google Shopping results. This multi-faceted approach bolsters buyer confidence by providing a diverse array of authentic perspectives. Reviews exemplify the power of "show versus tell" in DTC Performance marketing. They offer a platform for your brand to demonstrate how customers have experienced your products. These firsthand accounts can delve into transformations, and problem-solving successes and address specific concerns that may not have been covered in the product description itself. SMS and Email Building a customer database is essential for brand success. For brands, specific strategies can be employed to achieve maximum list growth. One approach involves a standard two-step lead capture process, where email information is collected on the first screen, followed by SMS details on the second. This technique, exemplified by our client BK Beauty, has proven highly effective. Offering staggered discounts (10% for email and 15% for SMS) and featuring a dynamic tab that displays the earned discount helped BK Beauty achieve remarkable results. In fact, an impressive 63% of new subscribers converted during the same session. For an alternative approach, consider staggering the opt-in process. Begin by collecting email opt-ins during the initial visit, and follow up with SMS later on. This method allows time to demonstrate value to the visitor. Sweetening the pot for SMS opt-ins with exclusive perks, such as early access to products or sales and additional loyalty points, can further incentivize participation. A full-page takeover strategy can create a sense of exclusivity and urgency. By "locking" a site or product page and collecting opt-ins for product release notifications, brands can generate high levels of anticipation and subscriber interest. Brick and Mortar An increasing number of digitally native direct-to-consumer brands are venturing into physical retail spaces, including well-known outlets like Sephora, Ulta, and Target. For brands considering or already pursuing this transition, it's imperative to bridge the online and in-store experiences for customers seamlessly. A powerful strategy involves utilizing geo-targeting technology to engage visitors who are on the verge of leaving your online platform. By identifying their location, you can provide them with valuable information about the nearest physical stores where your products are available. This approach is founded on the belief that some potential customers prefer to acquire their desired products immediately, even in an age of rapid shipping. As the trend of beauty brands making their mark on the shelves of major retailers continues to grow, employing such online-to-offline marketing tactics can yield substantial results. Integrating geo-targeting into your DTC Performance marketing approach will enhance convenience for customers seeking instant gratification and strengthen the connection between your digital presence and physical retail locations. This fusion of experiences fosters brand loyalty and facilitates a seamless transition for consumers who may want to explore your products in-store after discovering them online. Ultimately, this strategy capitalizes on the evolving nature of retail in the beauty industry, offering a strategic advantage for DTC brands looking to expand their reach and influence across multiple channels. As the lines between online and offline shopping continue to blur, utilizing geo-targeting to drive in-store traffic serves as a forward-thinking approach to amplifying your brand's presence in the ever-evolving beauty market. AI and VR Leading beauty companies are venturing beyond conventional approaches by harnessing the power of VR technology to craft immersive, digitally-native shopping environments. These 3D-rendered spaces allow online shoppers to explore and interact with products, creating an experience akin to walking through a physical store. The surge in popularity of virtual shopping was further amplified by the COVID-19 pandemic, which accelerated the adoption of innovative retail solutions. According to IDC, global spending on augmented reality (AR) and VR technologies in 2020 reached an estimated $18.8 billion, representing a remarkable 78.5% increase from the previous year. Virtual stores represent a paradigm shift in e-commerce, transcending static product catalogs to present dynamic, ever-evolving environments that closely mimic the immersive experience of a brick-and-mortar store. This evolution provides a significant competitive edge for online beauty brands, allowing them to engage customers more effectively and personally. A standout example is Charlotte Tilbury's Virtual Beauty Gifting Wonderland, unveiled in time for the 2021 holiday season. This virtual space allows consumers virtual beauty consultations and grants access to exclusive products. Moreover, it lets shoppers meet and shop with friends through video chat virtually, elevating the social aspect of the shopping experience. Influencer Marketing Influencers and beauty brands have forged a potent and mutually beneficial partnership. Sponsorships and gifted products serve as the foundation for content creation, including reviews and tutorials, which significantly drive online sales and engagement. Projections indicate that spending on influencer DTC Performance marketing will reach a substantial $15 billion by 2022 . Esteemed brands like Estée Lauder have adapted by allocating 75% of their marketing budget to beauty influencers. The outcomes are impressive. Beauty brands that invest in influencer marketing witness a remarkable ROI of $11.45 for every $1 spent, as reported by the British Beauty Council. For instance, Mielle Organics has perfected a micro-influencer strategy, collaborating with influencers who boast a smaller yet deeply engaged fanbase. They enlisted the support of natural hair advocate Tasha Jeana to endorse their Essentials Collection, yielding notable results. Future Trends in DTC Beauty Hyper-Personalization with AI and AR Today's consumers expect a personalized shopping experience, with 71% expressing this preference . Failing to meet this expectation can lead to frustration in over 75% of shoppers. The impact of personalization on customer loyalty is significant, as nearly 80% are more likely to make repeat purchases and recommend the brand if they receive a personalized experience. In the beauty industry, 58% of shoppers are inclined to buy from a business offering an online quiz for personalized product recommendations. Additionally, 45% are more likely to make a purchase if a virtual reality or AI experience allows them to try out a product online. Notable brands like Prose and Revieve are implementing high-tech personalization methods, achieving notable results. For instance, Prose's "Prose Hair Care" has seen a 200% increase in search volume over the past five years. JCPenney has also adopted AI skincare and AR makeup try-on experiences to enhance customer engagement. Moreover, companies like Pure Culture Beauty and Dr. Elsa Jungman are employing technology and scientific analysis to provide customized skincare solutions. The demand for such personalized approaches is evident in the 325% increase in search volume for "men’s skincare routine." Biotech Innovations with a Sustainability Focus The biotechnology trend in the beauty industry aligns seamlessly with the sustainability movement, with search volume for "sustainable beauty" surging by over 700% since 2019. Biotech methods are revolutionizing ingredient sourcing, allowing for sustainable mass production in labs, and circumventing land destruction and excessive water usage. Companies like Algenist and Evolved By Nature are leading the way by utilizing biotech to create sustainable compounds. For example, Algenist's patented ingredient, Alguronic Acid, derived from microscopic algae, has shown remarkable results in improving skin health. Major corporations like Unilever are also embracing biotech, partnering with firms like Geno to create sustainable alternatives to non-environmentally-friendly ingredients. Natural and Organic Ingredients Consumers are becoming increasingly conscious of the ingredients in their personal care products. With an average of 126 unique ingredients in just nine daily-use products, more than 65% are seeking environmentally-friendly brands, even if it means paying a premium. Search volume for "sustainable skincare" has surged by 566% in the past five years, reflecting a growing interest in clean, natural, and organic products. Brands like Walmart have responded by offering clean beauty shops, providing customers with a curated selection of products that align with their values. Beauty Sales and Brand Engagement on TikTok and Instagram Social media platforms like TikTok and Instagram are becoming significant avenues for beauty brand engagement and sales. Nearly half of all social media users are expected to make a purchase on a social platform this year, with an estimated annual spend of $800 per shopper on social commerce by 2025. TikTok and Instagram have proven to be particularly influential for beauty products. TikTok's engagement rate for beauty influencers is an impressive 7.52%, while Instagram follows closely at 1.87%. Brands like Truly Beauty have harnessed TikTok's power, amassing millions of followers and generating millions of views for their videos. User-generated content on Instagram has also demonstrated its impact, with beauty influencers driving significant product sales. Demand for Men's Beauty Products Social media, especially TikTok, has played a pivotal role in the rise of male grooming. The hashtag “men skincare” has garnered nearly 974 million views on TikTok, reflecting a growing interest in men's beauty products. Search volume for “men’s skincare routine” has increased by 325% in the past five years, and the market is expected to reach $110 billion by 2030. Brands like Atwater and Manscaped are capitalizing on this trend by providing tailored skincare solutions and a range of products catering to male consumers. Calls for More Diversity and Inclusion Consumers are demanding greater diversity and inclusivity in beauty advertising. While 43% of beauty consumers appreciate seeing diverse representations, nearly one-in-five still feel underrepresented. Brands like Fenty Beauty and Ami Cole are leading the way in inclusivity, offering extensive shade ranges and featuring models of various backgrounds. This push for diversity extends to racial inclusivity, with McKinsey reporting that Black consumers make up more than 11% of beauty spending, yet Black brands only account for 2.5% of industry revenue. Brands like Fenty Beauty and Ami Cole are helping to address this imbalance by providing inclusive product lines that cater to a broader range of consumers. In Conclusion The Direct-to-Consumer (DTC) beauty industry stands at the forefront of innovation, driven by an array of dynamic trends and consumer demands. To navigate this sphere, brands must adopt forward-thinking strategies. Moreover, embracing diversity and inclusion is not just an ethical imperative, but a strategic move towards a more inclusive and profitable future. Staying ahead of these trends and implementing effective strategies will be essential for brands looking to thrive in this competitive market. To explore how Saffron Edge can help your beauty brand employ these trends and strategies, visit our website. Elevate your brand, captivate your audience, and embrace the future of DTC beauty with us. ...
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