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
Jubilant FoodWorks faces Rs 47.5 crore GST demand, plans appeal
Tax authorities flag alleged misclassification of restaurant services
MUMBAI:Â Jubilant FoodWorks Limited has landed in a tax tussle after receiving a GST demand of Rs 47.5 crore from the office of the additional commissioner of CGST and central excise in Thane, Maharashtra.
The order, issued under the provisions of the Central Goods and Services Tax Act, 2017, relates to an alleged incorrect classification of certain services under the category of restaurant services. According to the tax authorities, this classification resulted in a short payment of goods and services tax for the period between the financial years 2019-20 and 2021-22.
The demand includes Rs 47.5 crore in GST along with an equal amount as penalty, in addition to applicable interest. The order was received by the company on March 13, 2026.
In a regulatory filing to the BSE Limited and the National Stock Exchange of India Limited, the company said it disagrees with the order and believes its arguments were not adequately considered.
The company is preparing to challenge the decision and plans to file an appeal. It added that once the redressal process is complete, the demand is likely to be dropped.
Despite the sizeable figure attached to the notice, the company said it does not expect any material impact on its financials, operations or other activities.
The disclosure was signed by Suman Hegde, EVP and chief financial officer, who confirmed that the company received the order at 19:06 IST on March 13 and has already initiated steps to contest it.
The development places the quick service restaurant major in the middle of a tax debate that could hinge on how certain restaurant-linked services are classified under GST rules. For now, the company appears ready to take the matter from the tax office to the appeals desk.
