Differentiation.
Most profitable strategies are built on it.
It’s what made people line up at Apple stores for hours to get their hands on the latest iPhone, why millions still tune in to watch Apple Events online, and the reason why Amazon is everyone’s go-to site when shopping online.
But with all the audience and personalization data, most eCommerce disruptors have had it easy. They know who their customers are, what they want, and when they’re most likely to purchase.
There never was a real need to focus on differentiation since disruptors heavily rely on direct-response advertising.
Until now.
With Apple’s ATT update and Google’s third-party cookie phase-out, direct-response advertisers have less data to create a winning campaign.
And that’s not all. The emergence of AI marketing tools has destroyed the competitive advantage that leaders in the space have had. That’s why companies are finally zeroing in on the one variable they can control but have sidelined all this while - creative.
Creative differentiation is the holy grail for brands looking for ways to combat ad fatigue, tell visually engaging stories, and encourage their audience to move up the purchase funnel.
Making the shift from optimizing efficiency to telling visually engaging stories requires a phased approach.
Phase One: Unlearning bad measurement metrics
Best practices for growth are usually focused on optimizing efficiency making it easy for disruptors to beat other direct-response brands.
Now, brands are on a level playing field. Good ad creative is the missing piece of the puzzle. It determines the kind of “response” consumers have to ads on social media.
But before performance marketing teams begin to double down on creative, they must unlearn practices that yielded results in the past. Shoppers seek authentic and personalized experiences, and treating data as insight to deliver these experiences will not cut it anymore.
Start making better measurement decisions with these three strategies.
1. Forget about CTR
I bet you can’t have a discussion about paid ads without someone bringing up CTR.
Click-through rates are notoriously misleading and do not correlate to any financial metrics.
Researches have proven that the ads that get the most clicks are almost never the ads that increase brand awareness or boost conversions.
But focus on measuring and increasing eSOV (excess share of voice), and you have a better chance at increasing market share.
2. Focus on broad ranges
All measurement is probabilistic, not deterministic. It’s easier to win a lottery than to predict the exact ROI of ad campaigns.
Since there are a lot of variables at play and many beyond your control, it’s wise to account for uncertainty and make predictions in broad ranges, not exact numbers.
3. Prioritize long data
More data = better decisions.
A famous study by Professor Paul Slovic disproved this theory. He gave a group of professional gamblers more data incrementally to measure the accuracy of their bets. Two things became apparent quite quickly:
- Access to some data is better than having no data
- But after a certain point, more data decreases the accuracy of bets
You can understand why this happens if you understand ‘signal-to noise ratio.’ The signal is the vital information that you must pay attention to, and noise is well, noise. It’s the meaningless and distracting information that must be ignored.
Since more data generally leads to more noise, prioritize long data instead of big data.
For digital advertisers, it could mean checking metrics once a quarter instead of every two weeks.
Phase Two: Learning why creative is the most critical variable and why it’s been ignored
The pandemic accelerated digital adoption among consumers, forced small businesses to go from IRL to URL, and led many leaders in traditional industries to turn to eCommerce.
If the competition pre-pandemic was fierce, trying to capture your audiences’ attention now is like having a never-ending root canal.
Creative is the single most crucial lever an advertiser can use to drive performance and growth.
It’s a variable brands can control that allows them to differentiate themselves easily. But at its core, it’s not just about aesthetically pleasing ads.
Creative is a way for you to build authentic connections with your audience, delight them and convince them that shopping for your products is the right choice to make.
Nearly 90% of consumers say authenticity is important when deciding which brands to support, and 70% want brands to offer personalized experiences.
In the absence of the usual data points, creative coupled with testing is the answer to the privacy-personalization paradox.
So, why is creativity in advertising so underrated?
Is it because we assume best-in-class creative requires a huge investment? (Spoiler alert: It might but it doesn’t have to be the norm.)
A recent survey by Kantar showed that 42% of global marketers test very little of their creative due to concerns about cost and speed.
Another obstacle is the increased need for customization, given how diverse and fragmented advertising channels are. Kantar’s survey found that only 49% of global advertisers are confident about tailoring creative executions for different channels.
To recap, marketers have three significant challenges:
- Creating good ad creative requires a huge investment
- Testing creatives incurs costs and requires more time
- Creating ads for different channels requires rapid customization
The answer to the creative dilemma is, unsurprisingly, technology.
Best-in-class creative no longer require brands to break the bank.
Ad platforms like Facebook allow you to use tools like dynamic creative that take different ad components and mix and match them until marketers know which combination works best.
Sidebar: Although other ad platforms like TikTok are on the rise, Facebook dominates the market and is here to stay.
Other cost-effective and rapid testing solutions can help marketers gather results in as little as 6 hours.
And while customization requires mastering both the human and quantitative components, the test-and-learn mental model is quite effective no matter which channel is being used.
Phase Three: Leveraging creative differentiation for your brand + examples from successful brands
Adopting the test-and-learn mentality to creative work is a necessity in the face of rapidly changing consumer behavior.
Many real-world scenarios like product launches, driving social commerce, and combating ad fatigue require you to test-and-learn creative to succeed.
Here’s a quick rundown of strategies eCommerce disruptors like you can use ( + success stories from brands that have implemented it).
1. Go mobile-first with Instant Experience
Mobile is the new-age storefront window.
A recent study by Facebook found that 78% of online purchases from Facebook ads happen on mobile. But most product launches don’t embrace the mobile experience nor measure valuable audience insights.
Instant Experience solves that problem. It’s a full-screen experience that loads instantly and engages users.
It's an ad within an ad. People can watch videos, swipe through images in the carousel, view more products, and tap buttons to visit other pages.
Track Instant Experience metrics like view time, link clicks, and page views to test the initial hypothesis of your audience’s preference and reiterate.
2. Unlock high ticket audiences with Collection Ads
eCommerce disruptors are often plagued with lower average order value (AOV) because cheaper items find an audience easily, and high ticket items tend to drive fewer conversions.
Collection Ads are powered by product catalogs combining images and videos with multiple products under them. It allows brands to diversify formats and placements to reach high-value customers.
Collection Ads open up an Instant Experience creating an immersive mobile-first experience for shoppers, inspiring them to learn more or make a purchase.
Komplett Group, the largest Nordic eCommerce player, experienced a similar problem. They had no trouble getting traffic to their eight webshops but had very few conversions to show for it. They ran dynamic product ads for thousands of their products using Hunch’s Creative Studio to automatically create ads saving them 80% of the time it took to create ads, and witnessed a lift in conversions by unlocking new audiences.
3. Drive social commerce with creative ads
G Adventures, a world leader in the adventure industry and Canada’s largest adventure travel company used automated localized video ads and enhanced dynamic product ads to get back in the game after COVID-19.
With Hunch’s automated ad solution for catalogs, they produced creative ads that looked like this.
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Not only did G Adventures reduce the time and effort needed to set up and launch these campaigns, but they were also able to get more granular and personalize customer journeys.
Creative merchandising + “watch and shop ads” will only become more commonplace given the significant uptick in social media usage since the pandemic.
4. Fight ad fatigue through creative diversification
According to a study by Stackla, 72% of consumers reported spending more time on social media since the pandemic started.
That’s music to most advertisers’ ears that rely on paid social. But it’s not all good news. Spending more time online means more exposure to advertising which leads to - you guessed it - ad fatigue.
Running two visually distinct creatives can solve this. Facebook ran a backend experiment with 2703 ad sets revealing that creative diversification leads to a lift in key performance metrics and a decrease in the average CPAs of campaigns.
Bottom line: Striking the balance
Brands working to find the balance between telling visually compelling stories and preserving their ability to hit the market quickly will undoubtedly find the process difficult and intimidating at first.
Winning on paid social requires marrying art and science - focusing on the right metrics and continuous testing to meet people’s needs.
The role of the creative in both short-term and long-term profitability was never in question. But brands always put it on the back burner due to underlying misconceptions.
The next wave of creative ads is set to change how people shop and how brands inspire action in the post-ATT and post-cookie world.
Liked this? Check out our explainer guide on dynamic creative - the #1 secret all top brands use.
