Are You Renting or Owning?

Why every smart DTC brand Is doubling down on owned channels right now

Author

Pietro Saccomani
March 06, 2025

Paid acquisition is a drug, and your brand is hooked.

You pour money into Meta, TikTok, and Google, chasing the next hit of revenue. But there’s a big problem; these channels are never in your control.

Paid traffic is just rented traffic.

And like a rented condo, you need to keep paying rent week in, week out, and your landlord can raise the rent, you can get kicked out.

Brands have no choice but to play the paid traffic game. At first, it’s the only way to grow and scale.

Eventually, you need to shift focus into revenue levers that you control.

You’re in a precarious position if you don’t have any dependable owned channels (and if CACs keep going up, you might not survive the year).

That’s why building and nurturing these channels should be your #1 priority.

The brutal reality of the paid media treadmill

Paid media is essential.

But it’s a treadmill.

You need to keep running, keep moving.

The second you stop moving, the treadmill will throw you to the ground in a heap.

The thousands of steps you took earlier don’t give you a buffer and allow you to rest.

You have no choice but to keep playing the game—if you stop pumping money into paid acquisition, sales stop just like that.

It’s just fraught with risks:

  • Rising CACs: Paid media costs have skyrocketed (Meta, Google, TikTok—nothing’s cheap anymore).

  • Declining organic reach: Social algorithms throttle your brand’s visibility unless you pay to play.

  • No control: One algorithm update, and your revenue stream can disappear.

Unfortunately, you can’t just ditch paid ads altogether.

What you can do is invest more in channels with lower costs, higher margins and, importantly, channels that you fully control.

Owned channels: high-margin, high-control

Owned channels are the buffer you need to deal with higher CACs, tougher competition, and a protective layer against platform risk.

Owned channels are equity—they give you long-term control, higher margins, and direct access to your customers.

What are owned channels, you ask?

Essentially, they’re any channel where you have full control over the content, audience, and messaging.

If you rely on another platform’s audience, an algorithm, or constant ad spend, it’s not an owned channel.

These channels include:

  • Email

  • SMS

  • Your website

  • Mobile apps

  • Communities, loyalty programs and membership programs

  • Direct mail

Why these channels are so powerful:

✅ No middleman—you own your audience and messaging.

✅ Higher retention & repeat purchase rates = higher LTV, without increasing CAC.

✅ Predictable revenue, even when ads underperform.

These channels allow you to drive sales that are nearly all profit.

They’re low risk, high-upside, and the more of your revenue that comes through these channels, the better position your brand will be in.

Where to focus first

If you’re currently all-in on paid acquisition (as many brands are), it must be difficult to know where you start.

You like the idea of getting more sales through low-cost channels you control; but it’s not as easy as flicking a switch.

So here are the first steps to take if you want to start making more from your owned channels.

Build direct contact lists (email, SMS, mobile app, community)

The question every DTC operator should ask:

How many people can I reach right now without buying ads?

The more people on your lists, the more direct contacts you have, the more potential revenue you can drive through owned channels.

But your lists won’t go from zero to 1mill overnight; it takes time.

So even if you don’t have a clear plan for how you’re going to utilize your lists yet, the sooner you start, the sooner you can build these into powerful assets.

Email & SMS

Email & SMS are the bare minimum.

You should already have an email list from past customers. But there’s probably the opportunity to put more effort into building your list from regular website traffic (people who haven’t bought yet/just browsing).

  • Incentivize sign-ups with an offer, exclusive content, or early access to new products.

  • Capture both email and SMS.

  • Test different approaches to email/SMS capture to maximize opt-ins.

Build your list before you need it.

Once you start serious email/SMS marketing, you’ll wish you started building your list 6 months earlier.

Mobile apps

A mobile app is a powerful owned channel for brands with high repeat purchase potential (e.g. apparel, beauty, supplements).

It’s a direct line to your customers.

You can reach them with push notifications at any time, for basically zero cost, and it delivers fully organic sales that are all profit.

App users are your highest-value customers; they spend more, shop more often, and tend to be brand evangelists.

Like email and SMS, it takes time to grow your app, so it’s best to start working on this asap (promote your app to your email list, on your website, make it as visible as possible and sell the benefits to customers of downloading it).

Above, you see PrettyLittleThing does a good job of educating customers on why they should use the app.

Once they get people into the app, they’ll typically contribute significantly higher LTV.

Communities/loyalty programs/memberships

Another approach to owned channels are communities, loyalty programs and membership programs).

  • Obvi and Kitsch both have large, engaged communities on Facebook

  • Fly By Jing has a $25/year paid membership program, that offers early access to new products, seasonal gifts, exclusive deals and member-only products

  • Sephora’s Beauty Insider program offers points, exclusive discounts, and higher tiers based on total spend

These are all assets that drive dependable, repeat revenue.

User communities can be incredibly powerful.

Take the two examples above—Kitsch’s community has over 57K members, and Obvi’s has 113K.

Those are huge groups of people interested in your brand, who you can reach for exactly $zero ad spend.

They also feed themselves; Obvi’s community averages nearly 10 new posts per day, driving brand awareness on autopilot.

Once again, you don’t get to 100K+ members overnight. So if you want to enjoy the benefits of an owned community or a loyalty program with engaged, high-LTV customers, start growing it now.

Use your lists

Once you’ve built these channels, start using them.

Many brands have large email and SMS lists, or apps with a decent amount of downloads, but they don’t really do anything to engage their users (and then claim that email is not effective, or apps aren’t worth it).

Start by setting up automated campaigns with email and SMS.

Abandoned cart, browse abandonment, welcome messages and post-purchase sequences consistently outperform typical “batch and blast” campaigns.

And even better, they take less work (they run by themselves after initial setup).

If you have an app, send more push notifications.

Higher push frequency (multiple times per week, or even daily) drive significantly higher retention rates, and keep your brand firmly top of mind.

Many are scared of over-using push notifications; but with the average person receiving 46 push notifications per day, the danger of going too far is much less than most think.

If you have a community or a membership program, nurture these channels as well.

Consistently provide value and a reason for people to stay engaged.

Don’t make it all about selling (customers don’t join a community just to be the first to see your ads). But do constantly engage with your community and drive the conversation around your products.

Use SEO to grow your owned channels

When many people hear “owned channels” they think website, SEO.

SEO plays a part in your owned media strategy, but SEO itself isn’t an owned channel.

It’s earned.

You don’t control it, Google does.

You control the content, but it’s up to the algorithm to decide whether to send you traffic or not.

But SEO is a powerful way to grow your owned channels.

It’s free, scalable traffic that you can turn into email/SMS subscribers, app downloads and community members, which you can then nurture into high-LTV customers.

When most brands think SEO, they only think SEO for product and collection pages.

This is the first area you should focus on, but it’s not the only way ecom brands can utilize SEO.

Long-form, high-value content (guides, comparisons, how-tos) can generate a ton of website traffic, which you can funnel into product pages (like Gymshark):

or into email signups (like Sundays for Dogs):

The key?

Don't treat SEO/web traffic as owned media by itself, but to use this as a low-cost growth lever to build owned channels that then deliver dependable, cheap revenue for years to come.

The ideal growth mix (balancing paid acquisition & owned channels)

So how much focus should you put on owned channels vs paid acquisition?

There’s no “one-size-fits-all” answer, but your brand should be working toward reducing paid dependency over time.

Early-stage brands will need to focus more on acquisition, as they need to make enough immediate revenue to keep the lights on.

(however it’s never too early to start building owned channels)

Scaling brands will want to start moving more of their focus towards owned channels, eventually making owned channels the center of your growth strategy.

As you build out your owned media strategy, track key metrics related to retention and owned channels (what gets measured gets managed):

  • % of revenue from email, SMS, app

  • List size growth (email/SMS subscribers, app users)

  • Engagement rates (open, click, purchase frequency, app sessions/session length)

  • Repeat purchase rate & LTV growth

With consistent effort, you’ll build a brand with higher overall margins, more control and direct access to your audience, and less reliance on the unpredictable game of paid ads.

Quick Hits

We’re what made us think from around the ecom world this week.

Scaling to $1M+ per year without paid ads

If you want to see what’s possible with non-paid channels, just look at a brand that has no choice about it.

Soberish, as a restricted product, doesn't have the luxury of paid ads. They have to lean on organic growth channels, and have used these channels to scale to 7 figures in under a year.

Kim Gamez, their founder, explains how they did it in this interview on the DTC Podcast.

Three stages of brand growth

If you’re a brand new startup trying to execute the same gameplan as present-day Nike or Adidas, you’re going to have a bad time.

This great post breaks down the three stages of growth brands go through, and helps you understand where you should be focusing your efforts at different points in your brand’s trajectory.

31 email marketing tips

Email marketing, though slightly less effective than it once was, is still a must for any brand interested in low-cost sales and retention marketing.

Yet many brands still aren’t using it right.

If you’re new to email marketing, or just want some tips to help improve your email game, this bumper post from one of the top email marketing voices around is just what you need.

Digital influencers for DTC brands

This conversation on Greg Isenberg’s Startup Ideas Podcast really got me thinking.

Cody Schneider raised the idea that DTC brands might, in the near future, own a portfolio of AI-powered digital influencers.

We could see brands build or acquire tens of digital influencers (fully AI), with large followings on social media, who they fully control.

These influencers would be a brand asset, just like an email list or a mobile app.

Interesting one for the futurists out there.

(19:25 if the link doesn’t take you there automatically)

Is ecom in rough shape?

Sorry to end on doom and gloom, but this might resonate with some DTC people.

Eddie kicks off his post with this:

“I’ve worked with brands doing $40,000,000 in revenue throwing away 8 figures on discounts just to stay alive.

Millions in top-line revenue, but the founder can barely make payroll.

This is eCommerce in 2025.”

He’s not the first to say it’s harder than ever for ecommerce brands to stay alive (not to mention grow).

The key? Long-term, sustainable revenue through high retention and a high-LTV business model.

Thoughts?

Best from our Blog

Here’s some of the best content we’ve published on our blog in the last week.

Why Email, SMS & Push Are Your Brand’s Most Dependable Revenue Channels

Email, SMS and push are the highest-ROI revenue channels we have, but so many brands aren’t using them enough.

We looked at why these channels are so powerful, how they work together in synergy, and how you can maximize their contribution to your revenue.

How to Own Your Website Traffic: Building Unstoppable Moats

If you want to stay safe from rising CACs, competition (and medieval armies), you need a moat.

For ecom brands, the best moat is owned traffic.

We break down the framework for building moats that protect your business, including a 5-step action plan to reduce reliance on paid and earned channels.

Does Your Brand Need a Mobile App?

Not every brand needs an app.

Low-frequency, naturally low-retention brands probably don’t. But for many other brands, an app can be one of your most powerful assets.

We broke down which type of brand should (and shouldn’t) build their own apps, why mobile apps work, and how you can build and scale your app (plus a few examples of brands that are winning with their mobile apps).

That’s all we have for this week.

Stay tuned at the same time next week for the next edition, where we’ll take another dive into another CX and retention topic that today’s brands need to know about.

Hit reply if you have any thoughts on owned channels, the paid acquisition landscape, or anything you’d love to see in a future deep dive.

Until next time!

Pietro and The Retention Edge Team

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