1 month ago
D2C Brands Shift from ROAS to Retention
Direct-to-consumer (D2C) brands in India are changing how they market their products.
For a long time, they focused on ads on platforms like Meta and Google, using a metric called ROAS to measure success.
But now, with ads becoming more expensive and AI assistants changing how people find products, brands are shifting their focus.
They are spending more on building their brand, keeping customers, and creating organic content.
They are also using new metrics like MER and blended CAC to track their success.
This shift is happening because simply spending more on ads doesn't guarantee visibility or sales anymore.
Brands need to earn trust and provide consistent content to stay relevant.
Additionally, ProMom, a D2C startup, is making breast pumps and related products, and has raised ₹30 Cr in funding to expand its product portfolio and distribution.
D2C brands are moving away from ROAS to focus on retention and brand-building.
Rising customer acquisition costs and AI-driven product discovery are driving this shift.
Brands are reallocating 20-30% of their marketing budgets to retention and brand marketing.
New metrics like MER, blended CAC, and contribution margins are being tracked.
ProMom, a D2C startup, has raised ₹30 Cr in pre-seed funding to expand its product portfolio and distribution.
- Who
- Indian D2C brands and marketers
- What
- Shift from ROAS to retention and brand-building
- Where
- India
- When
- Currently and projected future trends
- Why
- Rising customer acquisition costs and AI-driven product discovery
Traditional Performance Marketing
Modern Brand-Building and Retention
Marketing Focus
Traditional Performance Marketing
Focuses on paid performance marketing through Meta and Google.
Modern Brand-Building and Retention
Shifts towards brand-building, customer retention, and organic content.
Metrics
Traditional Performance Marketing
Relies heavily on ROAS (Return on Ad Spend).
Modern Brand-Building and Retention
Tracks metrics like MER (Marketing Efficiency Ratio), blended CAC (Customer Acquisition Cost), and contribution margins.
Budget Allocation
Traditional Performance Marketing
Allocates most of the budget to paid advertising.
Modern Brand-Building and Retention
Reallocates 20-30% of the budget to retention and brand marketing.
Key facts
- ROAS
- Return on Ad Spend
- MER
- Marketing Efficiency Ratio
- CAC
- Customer Acquisition Cost
- ProMom
- Lucknow-based D2C startup manufacturing breast pumps and related accessories
- Funding
- ₹30 Cr in pre-seed funding led by Fireside Ventures
Quotes
Viren Inaniyan
Founder of AI commerce infrastructure startup TruCommerce
“Consumers are now getting recommendations without even visiting a brand’s website, which has made marketing much harder to measure”
inc42.com
Sources
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