Gen-Z, Millennial D2C Opps: Sonos taps global creative AOR amid eCommerce focus, increased ad spend (Score 33)

Wireless speaker and home sound speaker brand Sonos concluded an agency review with the hire of VCCP NY and MUH-TAY-ZIK / HOF-FER as its global creative and strategic partners. With the goal of leading the way for Sonos's future product and service launches, the agencies will spearhead the company's global brand strategy evolution. The AOR shift replaces incumbent creative AOR SET Creative. This significant rebrand will likely be supported by notable amounts of ad spend.

Per marketing VP Pete Pederson, Sonos experienced "a year of remarkable growth," acceleration its leaders hope to continue. According to execs in the company's most recent earnings call, Sonos is becoming "more creative and more product" in its marketing, which aligns well with its rebranding efforts. It leveraged its spend to reach a record number of new customers while it kept building its brand powerfully. Right now, it is primarily focused on eCommerce sales since D2C sales; revenue in this channel rose 84% YOY and represented a record 21% of total revenue, up from 12% last year.

Sonos is currently advertising its products as potential holiday gifts. We imagine its speakers are in high demand right now as consumers spend so much time at home due to the global pandemic; they have more time than ever to upgrade their sound systems. This fall, Sonos launched an innovative, multifaceted marketing with Disney leading up to the second season of The Mandalorian (see video above). 

So far this year, Pathmatics estimates the company generated 1.2b digital impressions via Facebook (39%), desktop display (23%), Instagram (17%), desktop video (12%), mobile display (6%) and mobile video (3%) ads. An approximate YTD spend of $8m reflects a 36% increase from the approximately $5.9m spent by this point last year. Sonos ended up allocating around $7.4m toward this channel in 2019, more than double the roughly $2.9m it allocated in 2018.

Additionally, for its various brands, Magellan reports the company aired 198 podcast ads for Sonos, 161 podcast ads for Sonos One, 58 podcast ads for Sonos Beam and 7 podcast ads for Sonos Playbase within the past year.

Judging by the company's focus on paid social and podcast ads, its target demographic primarily consists of Gen-Z and millennials. To reach this audience, it may also utilize OTT.

Agency & martech readers - Reviews often follow one another, so reach out soon to secure potential media and/or digital analytics work. Winmo states Sonos works with Anomaly (creative assistance) and 360i (digital assistance).