Can Small Direct-to-Consumer Companies Afford to Join the #StopHateforProfit Movement?

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Multiple companies have halted digital advertising

in support of the Stop Hate for Profit movement. Stop Hate for Profit is a movement created by a number of civil rights and non-profit watchdog organizations that encourage businesses to hold their advertisements on Facebook.

The purpose is to urge social media platforms to improve their content moderation practices. While large companies such as Adidas, Coca-Cola, Honda, and Unilever are able to participate in the movement with little consequences to their business, small Direct-to-Consumer (DTC) businesses may not have the same capability. 

Many new companies have adopted the DTC business model and rely heavily on digital advertisement for engagement. According to MediaRadar, DTC advertising increased 50% in the past year. In addition, many companies are all on digital platforms and have no physical presence in the market, which makes digital advertising an essential component of their business.

Strategic marketing planning can help minimize the risks if DTC companies choose to join the movement and decrease their dependency on one primary platform. 


Strategic Marketing Planning

Diversification reduces the risk and loss in case one platform were to ever falter. Companies need to allocate their marketing budget by planning for both current and future trends.

Restructure social media marketing. The cost of new customer acquisition is increasing exponentially as the saturation of the market grows. This is especially troublesome for newer DTC companies to establish themselves. Mary Meeker, a venture capitalist, reported in her 2019 Internet Trend study that new customer acquisition costs were “rising to unsustainable levels.” This might lead to a short term sale but less likely to retain customer loyalty.

Seeking Alternative Social Media Platforms

YouTube can be used by DTC companies to drive their awareness through content targeting and affiliate marketing. Youtube has a considerably low-entry barrier which makes it easy for advertising.

 

 Snapchat and TikTok are two great alternatives, especially for brands targeting Gen Z and Millennials. Both platforms are heavily user-content driven and provide one-to-one user attribution. Using Snapchat advertisements alone, Ralph Lauren was able to achieve a 19% sales growth on their website.

Pinterest is another great alternative as the platform has 250 million active users monthly. About 29% of US adults are on this platform making it the fourth most popular social media site behind Facebook, Instagram, and YouTube.

Open Marketplace Integration

Amazon advertising offers many solutions within their robust infrastructure. Amazon allows advertisers to obtain direct feedback from its 112 million consumers and have quantifiable metrics to track the effectiveness of campaigns through CPC, CPM, and ACOS. It also allows easy entry on advertisement opportunities to Amazon’s subsidiaries such as Twitch Interactive, Whole Food Markets, and Alexa-enabled devices. 

If a business is operating through Shopify, digital advertising can now be displayed on Walmart’s website. Walmart recently announced their partnership with Shopify to introduce new brands to their growing marketplace. Walmart.com has experienced a 74% growth in Q1 of 2020 and most of that is due to new sellers and advertisers.

     The Power of Google

DTC companies can increase their exposure through Google by allocating their marketing budget to Dynamic Search Advertisements. Google analytics drives campaigns more efficiently and generates higher traffic for a company’s website.

Google recently announced that they will allow free shopping advertisements in the United States search results starting summer 2020. This is Google’s most recent effort to push Google Shopping in the ecommerce relevancy.

Reinvesting in Search Engine Optimization (SEO) will help mitigate the traffic lost through Facebook as a result of supporting #stophateforprofit. DTC companies can seek SEO professionals or use advanced SEO tools to help with brand recognition.


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Staying Innovative

Companies taking the DTC route should always be searching for new ways to approach campaigns especially when it comes to social awareness.

Reinvesting a marketing budget previously allocated for Facebook to restructure marketing campaigns can help small and independent brands remain successful. It also aids in the normalization of a substantial shift from passive complicity in systemic oppression to a new standard of expectations where brands are obliged to make ethical decisions for the greater good at the potential expense of their bottom lines. Though there are challenges involved in these choices, a diverse and flexible digital strategy are key in mitigating the heavy costs that come along with choosing to be on the right side of history.