‘Pouring gasoline where it needs to be poured’: Why a DTC seafood company is rethinking its ad spend

Early on in 2020, the company was spending approximately 70% of its ad spend on Facebook and sister company Instagram. In April, after the on-set of the pandemic, Get Maine Lobster began to reduce its reliance on the platform and now allocates roughly 55% of its ad spend to Facebook and Instagram. Another 30% is spent on paid search via Google’s Ad Words and 15% is reserved for experiments with affiliate marketing, programmatic display and podcasts. Previously, nearly 95% of the budget was allocated to paid social (mostly Facebook and Instagram) and search (Google’s Ad words) and another 5% for traditional. “What I think will happen is that the bottom 15% will slowly become like 50% and then Facebook will eventually become a remarketing tool,” said Murrell. “It’s hard to say. Programmatic is doing really well.”

While DTC marketers and media buyers have been talking about the need to diversify for years, doing so started to become more commonplace last year. “People are realizing they don’t want all their eggs in one basket,” said Nik Sharma, DTC investor and advisor and founder of Sharma Brands, of the trend. That will continue to accelerate this year, according to DTC buyers, who say that issues with Facebook’s Ads Manager as well as higher costs due to increased competition amid Covid. Another issue, according to buyers, is the impact of Apple’s iOS 14 update.

That’s contributing to Murrell’s continued shift away from Facebook as well. “Apple did an iOS update where you can change advertising settings — this impacted Facebook as well — we saw that [customer acquisition cost] started to rise and reporting started to skew,” said Murrell. “We weren’t able to tell how well things were performing — this encouraged us to continue diversifying advertising platforms and revenue sources.” 

“Everyone is monitoring the iOS 14 issue,” said Brandon Doyle, founder of Wallaroo Media, adding that the overall impact of the update is still yet to be determined. “At this point it’s undeniable — you need to be diversified or you’re doing yourself a disservice.”

As brands like Get Maine Lobster continue to diversify their ad spend, the marketers behind those brands will need to know their “risk/reward tolerance,” said Kevin Simonson, former vp of social at Wpromote, adding that new channels take time to learn.

Overall, Murrell suggests that marketers need to take a data-centric approach to diversification. “We’re very data-heavy and always analyzing every dollar spent,” said Murrell. “That’s why our marketing has evolved. It’s really analyzing the data and where customers are in the journey. We’re pouring gasoline where it should be poured and pulling back as needed.”