Direct-to-consumer (DTC) brands have historically relied on social media platforms to find new customers. However, the effectiveness of social media advertising has declined dramatically due to Apple’s privacy changes, higher ad costs, increased competition, and lower social media user growth. As a result, DTC brands are turning to other advertising platforms to acquire new customers, but in doing so, unknowingly leaking more of their data to their competitors. In this post, we’ll explore how brands are inadvertently leaking their data to be used by their competitors, how the problem is only getting worse, and how Amazon Advertising represents a privacy-focused alternative to reduce data leakage, help brands find new customers, and ultimately, return to profitable growth.
OPENING THE DOOR TO DATA LEAKAGE
For context, DTC brands almost always place tracking code on their websites from social media companies and ad tech companies. This code makes it easy for shoppers to engage with social media, and for advertising platforms to measure success and deliver results. However, this same code often scrapes these websites for behavioral data of their shoppers. This data is anonymized, aggregated and used to power advertisements by these platforms, both for brands AND for their competitors.
Brands should ask themselves – if an advertising platform they use doesn’t have a robust, privacy-focused dataset of their own, where do they get their data to power their ads from? An important component of it is from brands themselves, described under the guise of machine learning, optimization, and lookalike modeling with significant fancy marketing behind it. This just obscures what they are doing. Did you ever leave your own website and quickly see an ad from one of your competitors? Your data is being repurposed. Don’t take my word for it; read the business terms of service and privacy policies of the major social media companies and companies you buy ads from. Or ask your ad sales rep the next time you talk to them – is my data siloed only for my use within your advertising platform, or are you intermingling with other advertisers?
The problem is only getting worse. DTC brands are now turning to other advertising platforms to acquire new customers, but unknowingly leaking even more of their data to their competitors. This data leakage makes it harder for brands to compete, and it’s not just limited to social media companies and ad tech companies. Brands even have code deployed on their websites from companies they don’t even know. This is why it’s essential to take a mindful approach to privacy and protect your own data.
TRUST AMAZON INSTEAD?
Amazon takes a different approach. When you work with Amazon, they only use the code they deploy on a DTC website to help the DTC brand grow. It doesn’t get aggregated and used for other purposes. They don’t aggregate DTC website data and other advertiser data because they already have the best dataset out there by being almost 60% of eCommerce in the US. They also take privacy of users, customers, and advertisers very seriously and are a trusted partner to help businesses grow.
SEIZE THE OPPORTUNITY!
Amazon Advertising can help DTC brands grow on and off Amazon, and unlike many others in the advertising space, won’t repurpose their data for their competitors. However, this work is nuanced. Getting it right is hard. The targeting setup is unique and requires significant on-Amazon expertise, even for off Amazon brands. Optimization is different from other ad platforms. Navigating Amazon’s ad policy is challenging, as is understanding the unique dynamics of how Amazon Advertising helps DTC brands find new customers and drive sales. It also requires special access to the Amazon DSP.
At DPG, we can help. We’ll help you reduce data leakage to your competitors, and you’ll have only senior teammates with knowledge across all these topics advising you, aligning on strategy, setting up and optimizing your campaigns, and helping you improve business results and drive profitable growth over time. We’ll help you take a mindful approach to privacy and protect your own data, advise you on removing code on your websites that is leaking your data, and help you diversify your media investments. You will benefit from access to almost 60% of US e-commerce traffic, and over time and if you are interested, become an expert yourself.