Sprinters and Marathoners: yellowHEAD’s Digital Innovation & DTC Recap – yellowHEAD

yellowHEAD’s latest webinar shows that CPG businesses find success in DTC when they treat it like a marathon, not a sprint.

On top of being a remarkably disruptive year for almost everyone, 2020 transformed the relationship between consumer packaged goods (CPG) verticals and DTC markets, perhaps permanently. The lesson for businesses and marketers is clear: powerful DTC opportunities exist for brands that are willing to look beyond short-term actions and invest in long-term business goals. To better understand these changes, yellowHEAD’s Aviva Telias hosted a webinar with our own Guy Bauer (Head of Paid & Organic UA for P&G at yellowHEAD), Facebook’s Guy Snir and Nitzan Evron, and Procter & Gamble’s Augusto Marolla to discuss short and long-term e-commerce opportunities and the best practices for implementing DTC infrastructure.

Our webinar consists of three core segments:

You can view our webinar in full, but in the meantime, here are some of the lessons CPG marketers should take with them:

Build, Partner, or Buy

COVID-19 didn’t start the DTC trend, but it has accelerated the adoption timetable within CPG verticals. After all, businesses already have many reasons to engage with DTC markets: it reduces reliance on retailers, grants access to first-party data, and gives traditional brands a better footing when competing with DTC-exclusive companies.

According to Snir, most businesses have three avenues to implementing DTC capabilities:

As COVID-19 disrupted shopping patterns, CPG verticals overwhelmingly turned to the “build” approach to enter DTC markets. The pandemic made it clear that brands must step up to embrace e-commerce — building that infrastructure ensures that these capabilities will remain in place once the crisis ends.

Sprinters vs. Marathoners

As we move into the post-COVID landscape, Snir sees two types of CPG companies enter the DTC economy: he calls them “sprinters and marathoners”. While both now have e-commerce storefronts, the similarities stop there.

At this time, most CPG brands entering the DTC space do so as marathoners. Some enter the market as sprinters, either intentionally or because they do not have the resources to invest in robust infrastructure. In either case, CPG businesses must prioritize the average order value (AOV) to ensure their initiative is cost-effective. Snir notes that the most effective strategies are to implement subscriptions that allow for ongoing revenue or personalized marketing and purchases that drive consumer engagement.

Cultivating Marketing Innovation

In the second segment of the webinar, our panel noted several additional best practices to make entering the DTC space — and thriving within it — feasible.

CPG verticals are traditionally slow to change, but COVID-19 shows us that businesses have many opportunities to adapt. If you’d like to hear more insights and best practices from expert voices in the CPG and DTC fields, don’t forget to check out the full webinar! We’d like to thank our participants for taking the time to share these insights.

Looking for more insights to enhance your DTC marketing? yellowHEAD can help. Our proprietary Alison platform unifies data and creatives by identifying key elements that drive successful campaigns within your vertical. Once our experts verify these results, yellowHEAD’s creative studio produces the most effective assets for your target market. Let’s talk!