When Jenny Lei founded handbag brand Freja in 2019, she relied 100 per cent on digital marketing. With experience in dropshipping (where orders are shipped directly from the supplier), she felt she had a good grasp on paid advertising. “I didn’t know anything about SEO, content, pitching, or influencer marketing — but I did know they were incredibly time-intensive, so I figured digital ads would also be my quickest way to start seeing results. Which is what I needed at the time, with 300 bags piled up in my apartment and storage unit.”
In hindsight, Lei founded her brand at the tail end of digital marketing’s glory days. This month alone, Google and Meta both became embroiled in antitrust lawsuits, the US government alleging that that these corporations have unfair leverage through monetising all of their data assets together, and that these practices are anticompetitive (and illegal). TikTok, brands’ latest go-to advertiser, remains in limbo in the US, currently sitting through a second 75-day extension to its looming ban.
“The FTC’s weak lawsuit against Meta ignores reality,” Meta said in a statement, noting that, per the lawsuit, the FTC considers Snapchat and an app called MeWe its only competitors; Meta argues that TikTok, YouTube, X and other apps are also its competition. “More than 10 years after the FTC reviewed and cleared our acquisitions, the Commission’s action in this case sends the message that no deal is ever truly final. It’s absurd that the FTC is trying to break up a great American company at the same time the Administration is trying to save Chinese-owned TikTok.”
These latest developments make an already complex online advertising landscape — in the wake of 2024’s third-party cookie red herring, Apple’s 2021 iOS update that introduced app-tracking transparency and the EU’s now par for the course GDPR regulation — even harder for brands to manoeuvre to their advantage. This is in addition to consumers pushing back against paid ads with ad blockers, clearing histories and cookies, and asking apps not to track them, flags Nikhil Lai, senior analyst in performance marketing at Forrester. “Consumers are fed up with personalised advertising’s status quo,” he says. Plus, the current upheaval comes at a particularly rocky time, as brands need to engage shoppers more than ever to encourage them to spend amid fast-rising prices and consumer pullback.
In the last 10 years, Google, Facebook and Instagram — and now, increasingly, TikTok — shaped brand marketing budgets. “Honestly, they’ve owned the whole thing,” says Jack Campbell, founder and marketing strategist at Wize Agency. For the past decade, he says, if you had any marketing budget, most of it went straight to Google and Meta, and now TikTok. “They set the rules: short-term results, data-driven campaigns and constant pressure to ‘perform’.”
Throughout the 2010s, brands were built on this strategy. “These platforms promised — and delivered — precision at scale, conditioning brands to shift significant dollars into hyper-targeted digital ads,” says Derek Slager, founder and chief technology officer of Amperity, which works with companies including Tapestry to build customer data platforms and analytics. “But that created dependency, and many marketers ended up renting their customer relationships from these tech giants, without building enough direct connections themselves.”
Now, brands are needing to reckon with an over-reliance on digital advertising spend. The lawsuits are the most imminent reminder, but with or without the potential break-up, brands ought to be looking beyond strategies that worked years earlier. “Five years ago, you could chuck some money at Facebook ads and blow up overnight,” Campbell says. “Now, it takes a lot more to stand out. You need an actual brand — a real community, some substance behind you.”
If the on-again, off-again TikTok ban taught marketers anything, it’s that they need to diversify their spend. But if the platforms across which they diversified are potentially breaking up, where do these brands go now? There’s only so much budget to go around, and one upside of the singular ownership is that brands could pull data, for instance, from Meta-owned platforms Facebook and Instagram and use this to inform their wider strategies. If there are significant changes afoot across almost every digital advertising platform, where should brands go?
Built online
In Freja’s early days, Lei operated with a two-campaign structure, consisting of two to three ad sets each; three to five creatives per set. “I ran each ad at $5 to $10 a day and was very quick to shut off anything not performing, so I wouldn’t spend more than [around] $150 a day,” she says. In the first year, Lei was just breaking even. By year two, the return on ad spend (ROAS) was twofold whatever Lei was spending on a given day.
Now, with a more established business and money under her belt, Lei’s evolved her approach. Freja typically starts ad sets at $500 a day and runs all creative testing through a separate campaign using their proven best audiences. Any winners are then shifted to the main funnel. “I find that Meta’s algorithm is actually quite good once your pixel is seasoned, and we use a lot of their advantages and tools,” she says. “I try to produce only evergreen ads so we’re not constantly needing to refresh our creatives, but we aim to film a new batch of ads every three to four weeks or so. Since our product is not seasonal, this cadence is plenty for us at the moment.” Now, ROAS is consistently threefold Lei’s spend.
Meta says that a study conducted in early 2024 shows that US advertisers earned an average ROAS of $3.71 per dollar spent on Meta platforms – a 12 per cent increase from 2022. Many founders, though, say that they no longer see the returns they once did on paid ads.
Poppy Lissiman started her eponymous label in 2008 as a ready-to-wear brand — pre major digital advertising opportunities. In 2014, she pivoted to accessories, launched her e-commerce store and began to dabble. It was in 2016 that Lissiman embraced what she calls the ‘modern digital marketing landscape’. At peak times, Lissiman has spent up to $250,000 a month on meta ads alone. “As a mostly direct-to-consumer brand, digital advertising has been essential to our business, ramping up significantly during Covid, and year-on-year since then,” she says. Prior to the iOS update, this $250,000 monthly investment generated over sixfold ROIs (over $1.5 million). “Unfortunately, in today’s digital marketing climate, we’re no longer seeing returns at that level.”
Pia Mance, who launched accessories brand Heaven Mayhem in 2022, initially dipped her toes into paid advertising with a “tiny” daily budget of $15 on Meta. “To my surprise, those ads worked wonders, bringing in new customers at an incredibly low cost of just $2.50 — which is crazy for our price point,” she says. Now, Heaven Mayhem delivers ads across Meta, Google, TikTok and Pinterest and reinvests anywhere between 5 to 20 per cent of its monthly revenue into digital advertising (depending on the launch calendar and monthly strategy).
She was always wary of investing too heavily in paid digital ads, she says, thinking of these instead as a ‘nice bonus’. Now, she’s thankful. “In more recent months, the digital advertising landscape has definitely become more competitive and less efficient,” Mance says. Elena Bonvicini, founder of Los Angeles-based label EB Denim, has observed the same shift. She only recently began using paid digital advertising as a tool, and wishes she’d gotten in sooner. “There has been a huge slow down in conversion,” Bonvicini says. “In talking to my friends in the industry, a seven to tenfold ROAS seemed to be the norm, now we are lucky if it’s a fourfold.”
The digital ad web
If digital ad performance is already dwindling, if these major entities are forced to divest their subsidiaries, brands are in for a rude awakening. Digital ad dollars were worth their buck not just because brands could cross-polinate between platforms with the same owner (like Instagram and Facebook), but because by paying for one, they can reach consumers across multiple platforms (and gather data accordingly). Technology’s major players created a digital web of sorts: what you search on Google informs the ads you see on Instagram. If Meta and Google have to sell off their parts, this web will break. “Breaking them apart limits the overlapping data and would likely mean less granular targeting options for media buyers,” Amperity’s Slager says.
Campbell calls the current tracking abilities across platforms “creepy but effective”. “You Google a jacket, and suddenly it’s following you on Instagram. If that pipeline between companies is gone, retargeting gets a lot messier,” he says. Of course, consumers have long flagged issues with this ‘creepy’ pipeline, hence why many are now habitually clearing cookies and turning off tracking.
Given this, it’s not as if the web hasn’t been broken already by the technology changes of recent years, Slager flags. The loss of third-party cookies and tracking limitations like Apple’s App Tracking Transparency framework disrupted brands’ abilities to maximise investment. The corporations, too, have scaled back the level of data they release to brands. “Even in today’s world and with the power these entities have, there are limits to how willing they are to release control over their ownership of the consumer and its data,” Slager says.
Freja’s Lei still believes in the power of paid advertising. “I hear often that paid ads are getting super saturated and while that’s true, it doesn’t mean they’re ineffective,” she says. The barrier to entry is low enough that Lei believes, even with more competition, it’s still a more consistent channel than most in terms of revenue, once you nail it. “Paid is still our main acquisition channel to this day, although it took me almost two years to start seeing good results,” she says.
A total break up would be a headache at first — more platforms to juggle, more costs, harder to track what’s working. “Brands have gotten used to everything being connected and easy to manage in one place,” Campbell says. That said, he thinks it could be a positive in the long run. Right now, it’s more expensive than ever to break through the digital noise. More channels would mean more ad spots, creating opportunities for brands who couldn’t otherwise afford to play to throw their hats in the ring. “More competition could mean better options, and it’ll force brands to be a bit less lazy with their strategies,” Campbell says. Lissiman, for one, is hopeful that digital advertising competition would mean better pricing, less guesswork and greater transparency.
Ownership wins
In Vogue Business’s survey of almost 1,000 Vogue and GQ readers, when asked what luxury brands could be doing to better appeal to consumers, develop newer and more creative ideas (19 per cent) and create a better sense of community and brand experience (18 per cent) were two of the top five points of feedback.
Serendipitously, cultivating community with creative initiatives will benefit brands more than ever at this moment. Not just because it will make consumers happy (and more inclined to purchase), but by connecting directly with customers, brands reduce their reliance on unstable platforms.
“The smartest move brands can make today is shifting from renting relationships to owning them,” Slager says. “First-party data isn’t optional — it’s foundational.” Brands need to double down on their own digital ecosystems, he says: email, SMS, loyalty and experiences that resonate directly with their audiences. “This creates resiliency in the face of platform uncertainty and lets brands meet their customers on their own terms, without relying on the whims of Big Tech.”
Campbell agrees: “Your email list, your community, your events, your collaborations — that’s the stuff that’s future-proof,” he says. “The brands that survive the next few years are going to be the ones that people genuinely want to be part of, not just the ones with the best retargeting.”
Though Lei still believes in paid advertising, she has begun slowly shifting Freja’s marketing budget towards other channels, including organic (content marketing), retail, wholesale and events, so it’s less reliant on paid. “In case anything does happen,” she says. Right now, this cluster makes up about 20 per cent of Freja’s total marketing spend, with Lei’s goal to reach 35 per cent by the end of 2025. Lissiman, too, is leaning further away from paid digital marketing with pop-ups and building up the brand’s email database, which she says is the cheapest way to reach consumers — with a high conversion rate. “The flip side of this saturated digital world presents a very strong case for analogue or ‘antisocial’ marketing strategies,” she says. “Shifting the brand away from exclusively URL to more IRL is going to be a big focus for 2025.”
Out of home — or what Campbell calls “the real stuff” — is coming back. Heaven Mayhem bought the famous Sunset Strip billboard (yes, the one by Chateau Marmont). Lots of people have reached out off the back of it, Mance says. The other week, Flamingo Estate advertised Mother’s Day gifts on a giant QR-coded Times Square billboard — a marked departure from the lifestyle brand’s usual, more niche activations. Influencer Victoria Paris’s new jewellery brand, Tenfour, was also splashed across Times Square ahead of its New York pop-up. (Pop-ups are another focus for brand founders this year. Others, including EB’s Bonvicini, are planning permanent retail spaces.)
Heaven Mayhem is also investing in IRL events — not to sell product, but to boost community over matcha or wine. Mance offers virtual versions of these meet-ups, too, via monthly Zooms to offer customers a glimpse behind the scenes. “Our goal is to build a brand world that our customers and community feel a part of,” she says. “Sometimes, when there is a big emphasis on digital advertising, the brand and connection side of things fall flat.”
At the end of the day, it’s about authenticity and direct connection,” Slager says. “Fostering relationships that thrive regardless of algorithmic shifts or policy upheavals.”
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
More from this author:
Unpacking the creator economy battleground
Want to dress like your favourite celebrity? Ask this new AI shopping agent
As brands grapple with tariffs, is US distribution worth the investment?
