In an ever-competitive retail environment, ecommerce growth is often a double-edged sword. During the pandemic, brands rode a wave of unprecedented expansion, buoyed by a captive audience stuck at home and spending online. But post-pandemic, the scene has changed, leaving many ecommerce brands grappling with growth stagnation. As discussed by Ashleigh Shapiro, Senior Director of Growth at Code3, revitalizing growth in such a scenario requires a nuanced, data-driven strategy.

Shapiro shared insights from a compelling case study at the Amazon Ads Unboxed 2024 event in Austin, Texas, revealing how balancing demand generation with demand capture, leveraging Amazon’s Demand Side Platform (DSP), and breaking down internal silos can be the keys to sustainable success.

Listen to our conversation on how brands can drive e-commerce growth!

The Stalled Growth Story

The story of stalled growth is a familiar one to many brands. From 2018 through 2020, businesses experienced a significant surge in ecommerce activities, fueled by increased consumer adoption of platforms like Amazon. As Ashleigh Shapiro put it, “We saw the most adoption of ecommerce across the board, from consumers to marketers, during the pandemic.” The growth seemed almost unstoppable, with brand managers setting ever higher goals for revenue and market share.

However, by 2022, as life began to normalize, consumer behaviors evolved, and spending patterns began to change. “We noticed a consistent trend month-over-month throughout 2022 where growth started to decline, and demand tapered off,” Shapiro recalled. The challenge was real: how do you maintain growth when the tailwinds of lockdowns and increased online spending begin to fade? Shapiro and her team at Code3 took this challenge head-on, adopting a disciplined approach that hinged on what she calls “controlling the controllables.”

Controlling the Controllables

Shapiro’s approach began with a simple yet crucial idea: brands must focus on controlling what they can control—especially in a world still reeling from economic shifts and uncertainty. The macroeconomic factors were certainly impactful—inflation, election year, and shifts in consumer priorities—but as Shapiro noted, “There’s also a substantial number of things that are within our control.” These controllables included optimizing media mix, adapting to changing consumer demand, and deploying the right creative messaging.

One of the most important tools used by Shapiro’s team to recalibrate was the Amazon Marketing Cloud (AMC). Shapiro mentioned that it was “widely renowned as a huge unlock for brand scale.” AMC, along with audience overlap reports, helped reveal that the decline in growth wasn’t due to a lack of market interest. Instead, it pointed to an over-reliance on demand capture at the expense of demand generation—a crucial distinction that guided the subsequent steps taken by the brand.

Balancing Demand Generation with Demand Capture

The core insight that emerged from Shapiro’s analysis was that the brand had become overly dependent on capturing existing demand, particularly during high-intensity periods like Amazon Prime Day or Black Friday. “When you lean heavily on demand capture, you miss out on expanding the total pool of potential customers,” Shapiro explained. The key was to shift focus back to demand generation—identifying new customers and engaging them earlier in their buying journey.

Using tools like forecasting, brand search reporting, and audience overlap analysis, the team mapped out gaps where the brand was missing potential customers. “We realized there was a substantial number of consumers actively seeking out our product category that we were simply not reaching,” said Shapiro. To bridge this gap, they deployed Amazon’s DSP, which provided end-to-end measurement capabilities and enabled a shift to a more holistic media mix. This included running streaming TV and online video campaigns directly through Amazon’s DSP, allowing the team to reach consumers across the funnel with better measurement and attribution.

Breaking Down Internal Silos

Another major hurdle in revamping the growth trajectory was the fragmentation between different teams. Shapiro highlighted how many brands have separate Amazon, branding, and digital teams, each managing different budgets and running campaigns in silos. “Consumers perceive your brand as one entity. They don’t differentiate between your Amazon efforts and your direct-to-consumer efforts,” she pointed out. To address this, Code3 worked on integrating efforts across different channels, ensuring that branding and demand-generation efforts were consistent throughout.

By bringing together disparate teams and creating a unified approach, the brand could finally leverage Amazon not just as a platform for demand capture but also as a brand-building tool. “Amazon can be so much more. When you unlock it through the DSP, you’re not just capturing demand—you’re creating it,” said Shapiro. The transition involved tough conversations and required proving the effectiveness of a more balanced budget to decision-makers, but the impact was clear.

Measuring Success: The Importance of a Full Funnel Approach

The results of these efforts spoke for themselves. The brand achieved double-digit growth in 2022, and this momentum continued into 2023. The success hinged on effectively measuring key performance indicators that mattered most: incremental reach and branded search rate. “Your ability to drive success is only as good as your ability to measure it,” Shapiro emphasized.

Branded search rate—the volume of branded searches as a proportion of total impressions—became a key metric in tracking brand health. Despite increasing top-of-funnel activities that typically result in a diluted branded search rate, the brand’s search rate increased by 108%. “This was a huge nod to us hitting the right audience with our awareness efforts,” said Shapiro.

The integration of multiple ad types also played a critical role in enhancing conversion rates. Shapiro illustrated how consumers exposed to a mix of sponsored ads, DSP ads, and streaming TV campaigns exhibited conversion rates significantly higher than those exposed to just one ad type. “When a consumer sees all three ad types, their conversion rate increases to 2.5%, compared to just 0.35% with sponsored ads alone,” she explained, underscoring the value of a multi-channel, multi-touchpoint strategy.

Thought Starters for Brands Facing Stalled Growth

For brands currently struggling with stagnation, Shapiro shared three thought starters:

1. Evaluate Your Budget Mix: Are you investing enough in demand generation, or are you overly focused on demand capture metrics like ROAS? A balanced approach can unlock long-term growth.
2. Fully Leverage Tools and Insights: Tools like AMC and audience overlap reports can provide deep insights into where opportunities lie and help refine targeting.
3. Create a Full-Funnel Strategy: While performance metrics like ROAS are important, so is ensuring that you are reaching potential consumers at all stages of the funnel. “The comfort of a strong ROAS can often hinder the need for a broader, top-of-funnel strategy,” noted Shapiro.

Embrace Change and Stay Ahead

The ecommerce world continues to evolve, with macroeconomic shifts, changing consumer behaviors, and a rapidly developing technology environment. Brands that successfully navigate these waters will be those that adapt to changes, leverage the tools available to understand their customers, and maintain a balanced approach to both capturing and generating demand.

“There’s no one-size-fits-all answer,” said Shapiro, “but by controlling the controllables, integrating internal teams, and thinking full-funnel, brands can not only overcome stagnation but set themselves on a path for scalable, sustainable growth.”