Revenue Dictates Marketing Focus

The speakers discuss the balance between performance and brand marketing for DTC companies, sharing insights about when and how much to invest in each based on their experiences with successful brands like Native, Hims, and Hint.

• Performance Marketing is Critical Early Stage:

  • Most successful hyper-growth brands focus heavily on performance marketing
  • Performance marketing is necessary to reach $50M+ in revenue
  • Brand marketing alone likely can't get a company to even $50M in revenue

• Brand Marketing Strategy:

  • Hims took unique approach by:
    • Separating brand vs performance budget from day one
    • Getting board approval for specific allocation
    • Finding creative brand channels (bar coasters, above urinals)
  • Some companies like Away and Outdoor Voices invested heavily in brand but struggled
  • Casper spent significantly on beautiful brand ads but had challenging outcomes ($100M valuation after raising $400M)

• Successful Hybrid Approach:

  • "Performance branding" - building brand equity through working media dollars
  • Companies like Native and Hint succeeded by:
    • Simplifying messaging
    • Focusing on functional benefits
    • Building brand through performance channels

• Key Success Factors:

  • Need performance marketing for initial growth ("like an airplane needs energy to take off")
  • Products with clear functional benefits require less brand investment
  • No single path works for all companies
  • Some companies pivot to brand heavy strategy due to lack of performance marketing expertise

The speakers conclude that while both brand and performance marketing have their place, performance marketing is crucial for early-stage growth, with brand building becoming more important as companies scale beyond $50M in revenue.