The Reel - March 23

March 2023

In this issue

Last year was a pivotal moment as brands finally recognised how creative drives paid social performance. With marketing teams looking to deliver impactful ads more efficiently in 2023, what does the year have in store for creative? Explore the latest creative trends and strategies in The Reel.

Ben Ryder Head of Creative, Nest

This year will see numerous paid social creative trends come to a head.

Most brands now recognise the key role creative has in driving performance. After all, social media is crowded. Your ad needs to stand out in that environment whilst also getting your brand across. However, despite wider recognition of creative's impact, how brands tackle it remains inconsistent.

Meanwhile, in a post-iOS 14 world where data is limited, optimisation is more important than ever to get a competitive advantage.

AI is set to transform creative. When combined with a great creative strategist, it is already ensuring brands can produce creative quicker and at scale, as well as allowing for more in-depth analysis.

Your ads are the first touchpoint people have with your brand. They should tell your brand’s story, in addition to driving people to buy your product. That’s why you should be leveraging creative to build your brand whether the goal of your ad is for awareness or direct response.

Brands view of creative also remains too short-termist – overdeploying tactics such as UGC that drive initial results, and then not pivoting quickly enough when performance declines.

You need to have the building blocks in place to maximise the impact of your creative over time, to know how it works on different touchpoints, what your audience is looking for, and how you want to speak to them throughout the funnel.

Still, many brands have lots to learn. With platforms changing all the time, having a creative strategy you can rely on is crucial for performance.

In this rapidly changing environment, we are here to share insights into what works. That’s why we’ve produced The Reel – our deep dive into the creative trends and strategies for ecommerce brands, alongside examples of winning Nest Studio ads.

Video goes mainstream

The adoption of video ads sped up considerably last year. Across our clients, video ad spend more than doubled between Q4 2021 and Q4 2022. However, with 23% lower CVR and 20% lower CTR, brands need to be strategic to efficiently deploy the format.

User-generated content has allowed many brands to scale video at a lower cost of entry – but this tactic is starting to become saturated in the place of a more holistic approach to video. UGC has crossed the chasm from ‘Early market’ to ‘Mainstream’ in the ‘Adoption curve’ as more brands leverage the format (see below).

The proliferation of video has already changed how many brands approach paid social, and this is only likely to accelerate in 2023.

Shift to awareness ads mirrors trend to video

We saw a dramatic increase in awareness ad spend towards the end of 2022, with a 298% increase between Q3 and Q4.

This is reflective of changing priorities from ecommerce marketers as their focus shifts to new customer acquisition. Brands can also much better utilise video content for awareness ads, as the format performs much better for brand compared to direct response. This is reflected in 82% of our awareness spend in 2022 being video format.

This shift towards brand is continuing since peak – awareness spend remained considerably higher YoY in January and February 2023.

+298% increased investment in awareness ads

Seasonality matters for USPs

Certain USPs deliver significantly different results depending on the time of the year.

Offers resonate most during peak

It’s no shock that offers resonate more during Q4 – but it’s interesting just how significant the difference is. Conversion rates for ‘Offer’ ads were 61% higher in Q4 than in Q1.

Consumers buy quality in Q2

‘Quality’ messaging delivered higher AOV throughout the year, but peaked significantly in Q2 when brands launch their new seasonal ranges. AOV in Q2 was 144% higher and ROAS was 102% higher compared to Q4.

KEY TRENDS: MESSAGING

A look at two more USPs

Testimonials build trust and baskets

Testimonials from current customers are a powerful way to build trust with your future best customers.

We saw 22% higher AOV for ‘Testimonials’ messaging over the last six months.

Higher CVR for sustainability

Conversion rates for ‘Sustainability’ ads were 58% higher than average over six months.

In other words, intent is markedly higher among eco-conscious customers.

Sustainability vs Average CVR

Perform across the funnel

It’s not enough to just produce great ads. Your creative needs to be tailored to your objective.

Whether that objective is conversions, awareness or something else, how to deploy creative differs across the funnel.

Top-of-funnel

Lifestyle or brand content delivers the best results for top-of-the-funnel ads. Your objective here is to sell your brand, so your ad needs to achieve this.

Middle-of-funnel

Leverage USPs to show why your products are different from your competitors and what you solve to build consideration.

Bottom-of-funnel

When it comes to bottom-of-funnel ads, your customer is already aware of you. This means your ads should emphasise product features as well as remove blockers to purchase.

Getting ad volume right

When planning how much ad volume you need, there are many factors you need to consider. These are four of the most important:

Spend

You need enough volume of creative to drive efficient results from your spend. Too little, and even the biggest advertisers will see CPA skyrocket. Too much, and your production costs will hurt your bottom line.

Testing approach

The volume needed of creative variations needed should be built into your testing plan. The best results come from testing and iterating as a continuous process, and ad volume is an important part of this.

Fatigue rate

Your brand should be managing ad fatigue with new creative. There are countless factors which impact ad fatigue – from audience to targeting to frequency, so you need to be monitoring fatigue actively.

Content calendar

Whether you need extra volume of ads to bolster your higher sales periods or the right creative to align with your marketing calendar, the appropriate volume of creative needs to be built into your content calendar.

STRATEGY: AD VOLUME

What most brands miss

We analysed the ad libraries of 20 top-tier brands in addition to 100s of other ecom brands. These are the mistakes that we see happening over and over again:

Getting video wrong (or avoiding it completely)

Despite its increasing importance on paid social, many brands avoid video content. The brands that do often get it wrong, with ads that are too long or unengaging.

Lack of ‘paid-social-first’ videos

There are elements creative needs to deliver on paid social. Ads should have a hook as well as engaging transitions and USPs.

Overreliance on one type of creative

Not everyone resonates with the same thing, different audiences will respond better to different creatives – you should tap into all of them.

Missing essential elements

Sometimes it is unclear what is being sold, with a range of products often not being showcased, or even no inclusion of the product at all. What’s just as common, are ads where the brand itself is not present.

Low creative volume

Finally, even among brands that invest significant spend on paid social, many produce a low volume of ads. This is likely to produce diminishing returns from your ad spend.

Nest Studio Optimised

There is increasing demand for creative – but what if your brand doesn’t have the in-house expertise to produce enough ad volume or come up with ideas that drive performance?

We can help. Nest Studio will repurpose your brand assets into paid-social-first creative to power quick iterations, fresh concepts and variation tests – available standalone or with media.

Plus we have the data and depth of experience to know what performs on paid social.

Over the last six months, Nest Studio Optimised creative delivered 32% higher CTR, 52% cheaper CPA and 26% higher ROAS, when compared to brand-produced creative.

What can we do for your brand?

32% In the past 6 months, Nest Studio Optimised ads delivered: 34% 26% 52%

Higher CTR Cheaper CPM

Cheaper CPA

Higher ROAS

Examples of Nest Studio Optimised

Nest Studio Production

Producing creative specifically for paid social is a significant performance driver.

After all, if you are relying exclusively on repurposing your ads, then you won’t have creative freedom over the end result or the ability to explore different ideas.

Brands are frequently battling with in-house bottlenecks, and the process for getting ad creative is often disorganised or deprioritised within the business.

Nest Studio has just what you need. We offer end-to-end ideation, creative production and ads creation, standalone or with media.

Our creative is purpose-built for Meta and TikTok, supported by data-backed briefs, and a robust test-and-learn approach.

90% In the past 3 months, Nest Studio Production ads delivered: 31% 24% 41%

Examples of Nest Studio Production

Nest Studio creative services are available standalone or with media

We shift perspective

Our clients

Nest’s portfolio of ecommerce clients use a range of conversion and catalogbased campaigns, and most run campaigns in several markets. They also skew towards prospecting campaigns, rather than retargeting campaigns, with 79% of total spend in 2022 assigned to prospecting campaigns.