Because for 95% of Direct To Consumer (DTC) startup companies Google Ads marketing spend is a waste of their most precious resources:
Time and money.
Once they run out of those, the startup goes bust.
Why do I believe that Google offers bad value for most startups?
In order to succeed on Google Ads you need to have a compelling product and a great price. In my 8 years of working in and with startups, I’ve seen 95% of DTC companies NOT pursue a low cost strategy. Cost is a major factor in comparison searches on Google and other search channels, DTC companies who try to differentiate via better products, better customer service, and/or more sustainability etc are at a disadvantage. Because their products often come at a premium to the average product on search results.
This is why DTC companies are better off investing their scarce marketing spend on Meta platforms (Facebook and Instagram) or TikTok to reach $1 million in annual recurring revenue (ARR).
When companies advertise on Google Search, the advertiser turns into a commodity. Your offer is composed of 30 – 180 characters and you are one of 3 – 4 competing results.
The frame of mind of searchers plays a role too. Searchers are often already in the market for something specific. Great right? Not really. I’ve found that it’s much tougher to convince a buyer who is comparison shopping. Sometimes you can convince them that your product is what they are looking for. Sometimes price will play a big factor in their decision making.
However, in a discovery channel like Facebook or Instagram ads is that here you can inspire a purchase. If you capture their attention, you’re the first to showcase the solution that the audience has been thinking about. And here you come, with a snazzy video ready to throw them off their socks.
Your brand has inspired a future customer and they are less likely to comparison shop. If they do, you’ll be not one of 3 – 4 options. You’ll be the preferred option that other competitors need to muster up to. And I can almost guarantee you that they won’t be watching an inspired video like your ad creative.
This is why for 95% of DTC companies discovery channels like Meta are the right first channel to get to $1million in ARR.
DTC Marketing Budgets are best spent along the Corridor of Growth depending on where the product prices vs the competition
If you enjoyed this read, hit subscribe below to get an essay like this. Every so often.