Table of Contents
- Introduction
- The Emerging Trend of Full Funnel Performance
- The Power of Video-First Platforms
- The Economic Context and Its Implications
- The Diverging Paths of Digital Marketing Strategies
- Conclusion
- Frequently Asked Questions (FAQ)
Introduction
Have you ever found yourself pondering why some brands seem to flourish online while others struggle to make their mark? The digital age has ushered in an era of monumental shift from traditional performance-only marketing strategies towards a more holistic approach known as 'full funnel performance'. A recent report by Nest Commerce has shed light on this evolving landscape, highlighting the decisive turn towards brand-building within the digital realm, especially through video-focused platforms like Google, TikTok, and Meta. This comprehensive exploration will unpack the significance of embracing a full-funnel strategy to thrive in today's competitive online environment. By delving into this topic, readers will gain insights into harnessing the power of brand awareness and the crucial role of video-first platforms in achieving sustainable growth and improved Return on Ad Spend (ROAS).
The Emerging Trend of Full Funnel Performance
The landscape of digital marketing is witnessing a paradigm shift. Brands that once leaned heavily on performance-only marketing tactics are now embracing a more nuanced full-funnel approach. The impetus for this change? A recent report from Nest Commerce which meticulously analyzes global advertising data, detailing the impact of combining awareness or traffic campaigns with performance campaigns. Notably, brands adopting this dual-strategy experienced a remarkable 31% Year on Year (YOY) ROAS boost in the first quarter of 2024, while those focusing solely on performance reported a significant 32% YOY decrease.
This stark contrast underscores the evolving dynamics of digital marketing, where long-term brand-building strategies are increasingly recognized as essential to securing future demand and customer loyalty. The shift towards full-funnel performance is not just a fleeting trend but a strategic realignment towards sustainable brand growth.
The Power of Video-First Platforms
Central to this strategic shift is the rising importance of video-first platforms such as TikTok and Instagram Reels. These platforms have emerged as pivotal in driving brand awareness and engagement, especially among premium and younger demographics. For instance, TikTok showcased a 37% higher Conversion Rate (CVR) quarter-on-quarter in Q1 2024, marking its potency as a discovery platform. Similarly, Instagram Reels has witnessed a monumental 217% YOY increase in spending, propelled by its growing popularity among younger users and Meta’s increased investment, cementing its place in mainstream marketing strategies.
These platforms exemplify the transition towards a visual-first engagement strategy, where captivating video content not only enhances brand visibility but also fosters a deeper connection with the audience. Incorporating these platforms into a full-funnel strategy allows brands to leverage the unique strengths of each, maximizing reach and engagement across the customer journey.
The Economic Context and Its Implications
The current economic landscape adds another layer of complexity to the digital marketing equation. With advertisers enjoying a 6% reduction in Cost Per Thousand Impressions (CPM) on Meta compared to 2023, there lies a window of opportunity for brands to solidify their market presence. However, the expected economic recovery in the UK and the potential increase in CPM as the peak season approaches underscore the urgency for brands to adapt. Investing in brand-building now, while costs are relatively lower, could afford brands a significant competitive advantage in the times to come.
Will Ashton, CEO of Nest, reinforces this sentiment, highlighting the stark contrast between brands that maintained their brand investment during slowdowns and those that did not. This divergence, Ashton points out, is evident in the sustainable acquisition costs and overall performance, underlining the critical timing for brand investment.
The Diverging Paths of Digital Marketing Strategies
The report highlights a crucial divergence within the realm of paid social - between brands that have embraced the full-funnel, community-first approach and those still heavily reliant on performance-heavy strategies. The latter group, as indicated by the report’s data, faces unsustainable acquisition costs, underscoring the inadequacies of a performance-only focus. Ashton’s commentary provides a clarion call to brands aloof to these dynamics, emphasizing the need for immediate action to correct course and seize the opportunities presented by the current market conditions.
Conclusion
The shift towards full-funnel performance marketing, underscored by the rise of video-first platforms and the evolving economic landscape, signifies a crucial juncture for brands operating in the digital sphere. The Nest Commerce report serves not only as a testament to these changes but also as a guide for navigating the complexities of modern digital marketing. Embracing a full-funnel strategy, prioritizing brand-building alongside performance, and capitalizing on the unique opportunities presented by platforms like TikTok and Instagram Reels are no longer just options but necessities for brands aiming for long-term success and sustainability. The time for action is now, with an eye towards future-proofing brand visibility, engagement, and ultimately, profitability in the ever-competitive online marketplace.
Frequently Asked Questions (FAQ)
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What is full-funnel performance marketing? Full-funnel performance marketing is a comprehensive strategy that combines awareness, consideration, and conversion campaigns to guide potential customers through the entire buying journey, from initial discovery to final purchase.
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Why are video-first platforms significant for brand-building? Video-first platforms like TikTok and Instagram Reels offer dynamic, engaging mediums for storytelling and brand exposure, especially effective in capturing the attention of younger audiences and driving higher engagement rates.
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How does the economic context influence digital marketing strategies? Economic factors, such as fluctuations in CPM, impact marketing budgets and strategy effectiveness. Understanding and adapting to these changes is essential for optimizing spend and leveraging periods of economic recovery for brand growth.
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What does the reported divergence in paid social strategies indicate? The divergence signals a growing realization that brand-building and community-first approaches, as opposed to performance-only strategies, are more sustainable in the long run, leading to more effective customer acquisition and retention.
