At the 2017 Joint Board of Directors meeting of the IAB, the American Association of Advertising Agencies, and the Association of National Advertisers, the introductory presentation showed that most major consumer-facing industries in the United States had lagged GDP growth for nearly a decade, and most major companies in those industries had lagged their sector. As a result, advertising revenue growth for IAB’s members had become anemic. We determined to find out what had happened to growth in consumer industries, and develop a new “playbook” for our members.

Using economic data from the Department of Commerce and functional data from a score of consumer industries, covering such functions as sourcing, logistics, manufacturing, marketing, and sales, we determined that growth had not stopped in these industries, but rather moved from long-time dominant incumbents to a continually-replenishing army of startup disruptor brands which, individually, were too small to be noticed in syndicated research. We dubbed the concept the “Direct Brand Economy,” and identified as its central characteristics the promiscuous availability of “rentable” supply chain functions, and the possession by the disruptors of scaled, first-party relationships with their end consumers. IAB validated the thesis through a research partnership with Dun & Bradstreet, which identified more than 5,000 companies fitting these characteristics that had launched within the previous seven years. We published annual reports on the Direct Brand Economy every year, starting in 2018, as well as ancillary “playbook” research guiding ad-supported media and platforms to the plethora of potential new advertisers and their service expectations.

IAB launched a thousand-person annual conference devoted to Brand Disruption and a partnership program for media companies interested in adapting to and profiting from the Direct Brand Economy. The association also changed its membership rules to welcome brands into membership. Within two years, the Direct Brand Economy program accounted for new, incremental growth equivalent to 10 percent of the association’s revenues, and IAB had added 150 new brand members, a 20 percent increase in total membership. Members in the strategic partnership program reported that Direct Brands had become their fastest-growing category of business.