Why DTC brands are increasing out-of-home marketing

Direct-to-consumer brands are on the hunt for the best brand awareness strategies as they gain distribution in physical stores. But rather than looking to AI or a social media platform’s algorithm for all the answers, many are now adding an old-school tactic to the mix: outdoor advertising. The billboard embrace comes as out-of-home ad sellers enjoy an overall uptick, with global OOH ad revenue expected to jump by 12.7% this year to nearly $36 billion, according to GroupM’s midyear forecast. The forecast does not break out DTC spend. But three out-of-home agency operators—as well as a multitude of DTC brands—told Ad Age that DTC brands are now spending more money on OOH advertising than they have in recent years and quarters. Some of these companies are running OOH ads for the first time, whereas others are simply increasing spend and overall OOH efforts. “We’re seeing a lot of brands come in now—especially DTC brands—and spend in the space,” Brian Rappaport, founder and CEO at Quan Media Group, an out-of-home advertising agency, said. “It seems like there are a lot of brands that are coming out of nowhere that have never spent in the out-of-home space before, that are in the DTC world, that want to either test the channel or do something big in it.” Knix, Athena Club, Omnilux, Maëlys and Recess are among the DTC brands that have worked with his agency in recent months. Sign up for Ad Age newsletters From influencer marketing to agencies, get the latest news and analysis delivered to your inbox Click here Brands that had paused out-of-home spend and are now embracing it again include Away and Ro, Rappaport said. Quan has seen an uptick in out-of-home spending from DTC brands in the third quarter of this year in particular, he added. David Krupp, Americas CEO at out-of-home agency Billups, also said that he’s noticed some DTC brands increasing their OOH investments this past quarter compared to the same period in 2022. Tom Shea, CEO and co-founder at Adgile Media Group, which helps advertisers get out-of-home ads on trucks, said he’s noticed a steady quarter-over-quarter increase in the amount of DTC marketing dollars coming into out-of-home since 2021, when new privacy regulations from Apple caused DTC brands to diversify their investments outside the Meta ecosystem. DTC brands are increasingly looking to a physical retail presence to scale after adjusting to fewer venture capital dollar infusions in the space and Apple’s privacy policies making the Meta advertising ecosystem less effective. And finding a coveted spot on one of these shelves is competitive, as there’s a limited amount of space in every store. OOH tied to retail expansion DTC body care brand Curie tried its hand at OOH advertising for the first time in August, Founder and CEO Sarah Moret said. The brand’s outdoor media buy includes seven trucks wrapped in Curie branding circulating around large Walmart hubs such as Atlanta, Los Angeles, Dallas/Fort Worth and Bentonville, Arkansas, where Walmart is headquartered. The positioning was intentional, as the brand recently rolled out in many of Walmart’s stores. “In talking with other DTC brand founders, we’ve heard how important it is for a brand to support its wholesale operations with marketing—which is why we decided to support our Walmart rollout with our first out-of-home brand awareness campaign. To date, we’ve relied on digital advertising—but the timing felt right to make a big splash in real life,” Moret said in an email. Curie allocated 10% of its marketing budget from August through the end of this year to the OOH campaign, she added. Curie handled the creative in-house and teamed up with Adgile, the media agency, to coordinate the trucks. “Out-of-home is such a perfect complement as a channel to support a retail opening or existing store openings because you can be hyperlocal, you can target around the store,” Rappaport said. Christina Kao, co-founder of DTC manicure brand Le Mini Macaron, said that her company started to include OOH advertising in its marketing mix when its products hit stores such as Target in early 2022. Now, Le Mini Macaron puts “anywhere from 15-25% of total marketing spend against OOH” when it runs a campaign, she said. “I believe for a brand that goes from DTC to offline, it's really important for consumers to start to see your brand in physical spaces (beyond just digital, social and influencer spaces),” Kao said in an email. “It makes sense if the brand is in hundreds of points of sale (physical store locations) for the advertising to be physically present outside.” View this post on Instagram A post shared by adgilemediagroup (@adgilemediagroup) “Seeing advertising IRL [in real life] elevates the brand and makes it more tangible. For example, we have loved running truck ads where you see our brand drive by our retail partner stores (Target or ULTA,)” she continued. Tower 28 Beauty is another brand that recently increased its out-of-home advertising efforts. Amy Liu, CEO and founder, pointed to the increasingly competitive retail landscape for DTCs trying to enter stores. “Consumers want to see you out in the real world—not just from a screen,” Liu said. View this post on Instagram A post shared by Tower 28 Beauty (@tower28beauty) “Retail shelves have never been more competitive,” she said, noting how many DTC brands are fighting for a finite amount of distribution. Yariv Citron, co-founder and chief marketing officer of Maëlys cosmetics, said in an email that the brand first ventured into OOH in July to plug a new collection of body serums. The move came after it entered Ulta stores in the U.S. in 2022 and Shoppers Drug Mart stores in Canada earlier this year. “OOH advertising in our case is more relevant now that we have an omnichannel presence,” Citron said. “We want consumers to start seeing our brand in other places so when they are shopping in-store or are served an ad on Instagram—this isn't the first time they will have seen us.” Early returns are positive. “We had a significant increase in site traffic the week of launch and had one of our best weeks of sales for 2023. We will definitely look to explore new ways to incorporate OOH advertising in our marketing plans in the future,” he said. View this post on Instagram A post shared by MAËLYS (@maelys_cosmetics) Sign up for Ad Age newsletters From influencer marketing to agencies, get the latest news and analysis delivered to your inbox Click here

Why DTC brands are increasing out-of-home marketing

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