Brands
Why ROAS shouldn’t be the North star metric for D2C brand founders
Mumbai: In the competitive landscape of D2C brands, selecting the right agency can be a make-or-break decision. However, many brand owners often fall into the trap of focusing solely on the wrong metrics and questions when choosing an agency partner and jumping from one agency to another, whoever promises the highest ROAS.
During discovery calls with potential agencies, brand owners frequently inquire about metrics and strategies that may not necessarily provide the insights needed to make an informed decision. Questions such as “What ROAS can you get me?” or “Could you increase my current 5x ROAS to 7x?” often dominate these discussions.
When a brand’s north star metric is purely ROAS, it often fails to establish a sustainable or profitable business I’ve even encountered brands that penalize agencies for not meeting target ROAS goals.
While these metrics are important, it is important to understand other metrics in its correlation – like CAC Vs. nCAC (new customer acquisition cost) to gauge the growth of the brand.
Here are some questions D2C brand founders should consider when selecting an agency:
Focus on Problem-Solving Prowess
Instead of fixating on competitor ROAS or benchmark ROAS, inquire about the agency’s experience in tackling challenges specific to your industry. Understand their problem-solving prowess and how they approach unique objectives and hurdles faced by your brand.
Assess the Agency’s Resilience
Business downturns are inevitable, so it’s essential to assess how an agency handles adversity. Inquire about their processes and strategies during tough times. Do they pivot swiftly to adapt to changing circumstances, or do they adopt a wait-and-see attitude?
Align Metrics with Business Objectives
Ensure that the agency’s metrics align with your business objectives and provide meaningful insights. Instead of solely focusing on ROAS, inquire about how they evaluate ROI and whether their metrics reflect your brand’s goals and priorities.
Prioritize Quality over Quantity in Creatives
In industries like apparel, jewelry, and accessories, quality often trumps quantity when it comes to creatives. Understand the agency’s approach to creative development and how they measure success. Emphasize the importance of smart, effective creative strategies over sheer volume.
Understand Reporting Processes
Reporting is essential in performance marketing, but it’s not just about pretty PowerPoint presentations with dashboard screenshots. Inquire about the agency’s reporting processes and their understanding of the numbers behind the data. Ensure that they provide actionable insights rather than just surface-level metrics.
Look Beyond Price
While price is undoubtedly a factor to consider, don’t base your judgment solely on cost. Instead, look for agencies with relevant experience, a track record of success, and a deep understanding of your brand and industry. Focus on the value that an agency can bring to the table rather than simply opting for the cheapest option.
While brand owners may not need to be experts in performance marketing or ad operations, having a fundamental understanding of key metrics is crucial for informed decision-making and strategic planning. In today’s competitive landscape, where digital marketing plays a significant role in brand growth, being aware of performance metrics empowers business owners and top management to assess the effectiveness of marketing efforts, optimize campaigns, and allocate resources wisely. By grasping these metrics, stakeholders can better collaborate with agencies, set realistic goals, and drive sustainable growth for their brand in an ever-evolving market.
The author of this article is Adbuffs lead creative strategist Talia Praveen.
Brands
Primus Partners appoints Akasa Air co-founder Neelu Khatri as independent director
Veteran aviation and defence professional joins as independent director
NEW DELHI: Primus Partners has appointed Neelu Khatri, a founding member of Akasa Air, as an independent director, strengthening the consulting firm’s board as it prepares for its next phase of growth.
Khatri brings more than three decades of experience across defence, aviation, aerospace technology and consulting. She was part of the core team that helped build Akasa Air from concept to launch, contributing to what has been widely described as one of the fastest airline scale ups in recent aviation history.
At Primus Partners, she will provide strategic guidance on corporate governance and help steer the firm’s long term growth plans. Her experience of building a start up into a full scale organisation is expected to support the consulting firm as it expands its footprint.
Primus Partners co-founder and chairperson Davinder Sandhu, said the appointment brings valuable expertise to the board. “Neelu’s journey across defence, aviation and consulting brings a rare blend of operational insight and strategic thinking. Her experience in rapidly scaling Akasa Air will be invaluable as we continue to grow while maintaining a strong focus on corporate governance,” he said.
Primus Partners, an India headquartered management consulting and solutions firm, has emphasised governance and board oversight since its early days. The company has also taken an unconventional approach by inviting its Gen Z employees to attend board meetings so that younger perspectives can contribute to discussions.
Speaking on her appointment, Khatri said the consulting sector is entering a transformative period shaped by emerging technologies. “The industry is evolving rapidly with the rise of AI. This is an exciting moment for an Indian origin consulting firm like Primus Partners to expand its product offerings and strengthen its presence globally,” she said.
She added that as the firm pursues ambitious expansion plans, her focus will be on ensuring strong governance frameworks and effective risk management as the organisation scales.
