As many direct-to-consumer brands can attest, advertising today is a completely different game than in years past, with rising customer acquisition costs and a crowded field of companies all trying to reach the same millennial audience.
Even the social landscape is different from just a couple years ago, and a new Facebook report points out the numerous ways brands can reach customers—using case studies from its own platform.
Jake Bailey, director of emerging disruptors at Facebook, said marketers can come away with three main lessons from the report: consumers care about what brands stand for; machine learning and its impact for brands; and how community-driven brands are finding great success on and off Facebook and Instagram.
For example, the report highlighted word-of-mouth marketing and how that can play out on Instagram. In a survey, 92% of Instagram users globally said they’ve visited a website or made a purchase when they saw a product on Instagram.
Word-of-mouth extends beyond the brand as well, with personal recommendations from friends and family helping to drive purchasing decisions.
According to a SurveyMonkey study referenced in the report, 65% of respondents said friends and family are the most influential when it comes to making a big purchase. Among millennials, 70% said content from friends and relatives has a big impact on their purchase decisions.
Part of those decisions also stem from a growing number of private Facebook Groups, in which consumers discuss the latest trends or features they want. In the report, Facebook cites Peloton’s use of its group to gather customer feedback that led to the introduction of new features such as custom audio controls, GPS and run metrics.
“It’s clear that users are definitely using messaging as a larger part of their day-to-day communications,” Bailey said. “If you really want to think about long-lasting value as a company, building a community around your brand builds a competitive moat around your business.”
Part of the report emphasizes the growing presence of machine learning and AI on the platform that automates certain ads to reach more users. Bailey explained that as these technologies advance, it frees up marketers to explore more with their creative and focus them beyond the last click.
For example, Facebook cites DTC lingerie brand ThirdLove as a company that went beyond direct response and built a campaign around the brand’s Fit Finder quiz, resulting in a 37% increase in purchases.
“We work with these [direct-response companies] to teach them how to build brands—that means coaching them on how to use upper-funnel tactics as they think about stories and as they think about Facebook watch and these other formats,” Bailey said.
“What’s going to change over the coming years and quarters is the importance of creative—especially [as we automate] a lot of the advertisements. Differentiation through creative is probably one of the most important things we advise to our clients.”