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
Prataap Snacks posts Rs 1.14 crore Q4 profit, EBITDA up 319 per cent
Yellow Diamond maker posts turnaround with Rs 1.14 crore profit, 10 per cent dividend proposed
NEW DELHI: Prataap Snacks Limited has staged a sharp turnaround in the fourth quarter of FY26, reporting a 319 per cent surge in operating EBITDA and a return to profitability after a challenging previous year.
The Indore-based company, known for brands such as Yellow Diamond and Avadh, posted income from operations of Rs 420.18 crore for Q4 FY26, marking a 5 per cent year-on-year rise. Operating EBITDA climbed to Rs 20.59 crore, while margins stood at 4.9 per cent.
Most notably, the company reported a profit after tax of Rs 1.14 crore for the quarter, reversing a loss of Rs 11.94 crore in the same period last year. Diluted earnings per share improved to Rs 0.48 from a negative Rs 5.00 earlier, signalling a steady recovery in performance.
For the full financial year, consolidated income rose 1 per cent to Rs 1,724.65 crore. Annual operating EBITDA grew 68 per cent to Rs 81.81 crore, while the company posted a net profit of Rs 9.72 crore, compared to a loss of Rs 34.27 crore in FY25.
Reflecting this improved performance, the board has recommended a dividend of 10 per cent, equivalent to Rs 0.50 per share on a face value of Rs 5.
Prataap Snacks Limited managing director Amit Kumat said the recovery was driven by sharper execution and data-led decision-making, including the use of Sales Force Automation analytics. The company also expanded its distribution network to over 5,000 distributors and strengthened its presence on quick commerce platforms.
Looking ahead, the company expects double-digit revenue growth in FY27, though it remains cautious about inflationary pressures on key inputs such as packaging materials and edible oil. Management plans to offset these through tighter cost controls and calibrated pricing strategies.
With profitability back on track and operations stabilising, Prataap Snacks appears to be regaining its footing in an increasingly competitive packaged foods market.
