On September 24, 2026, Digital Brands Group — the Nasdaq-listed apparel and e-commerce company behind brands including the collegiate licensing label AVO — published a set of numbers that read like a contradiction. From August 1 through September 11, 2026, AVO generated a 221% year-over-year increase in revenue while reducing digital marketing expenditures by 78% compared with the same period in 2025. During the same window, the brand achieved a 3.65x return on ad spend.
Growth while spending less is the oldest promise in marketing. It is also the promise most growth stories quietly fail to keep, because the usual way to grow revenue is to spend more to acquire customers. AVO did the opposite — and the mechanism behind it is worth unpacking, because it points to a structural shift in how direct-to-consumer brands can think about efficiency.
Background
AVO is Digital Brands Group's collegiate licensing brand — apparel built around university partnerships, sold primarily through e-commerce. Collegiate licensing is a distinctive corner of apparel: the license itself creates built-in demand (students, alumni, and fans with deep loyalty to a university's marks), which means customer acquisition can lean on affinity rather than cold persuasion. That structural advantage matters for understanding what happened next.
DBG, a publicly traded company specializing in apparel and e-commerce, has been working to demonstrate that its brand portfolio can grow profitably rather than just grow. The AVO announcement was positioned as evidence of "accelerating revenue growth alongside significantly improved capital efficiency" — the combination investors in consumer brands most want to see.
The challenge
Digital advertising has become steadily more expensive and less trustworthy as a measurement discipline. Throughout 2026, practitioners have warned that inflated platform ROAS figures can mislead advertisers, and industry surveys have shown investors increasingly view lower marketing spend as a positive signal. The challenge for a brand like AVO was to grow without falling into the trap of buying revenue at ever-higher acquisition costs — spending $1.85 to regain every $1 saved, as one widely cited industry analysis of lost-market-share recovery has put it.
The deeper strategic question was whether AVO's growth was coming from the efficiency of its marketing or from the underlying strength of its licensed demand. A 221% revenue increase over six weeks is dramatic enough that the baseline matters: year-over-year comparisons can flatter a brand that was underperforming in the prior period. The company addressed part of this by reporting weekly progression — among universities launched in 2026, weekly net revenue rose 442% from Week 1 to Week 6 — which shows acceleration within the window, not just a favorable comparison.
The approach
AVO's efficiency story appears to rest on three elements visible in the company's disclosures.
First, spend where affinity already exists. Collegiate licensing means the brand does not have to manufacture desire from scratch; it channels demand that universities and their fanbases already generate. Marketing efficiency is structurally easier when the audience arrives pre-sold. The 78% reduction in digital spend suggests the company stopped paying to reach people it did not need to pay to reach.
Second, measure what matters. The company reported ROAS of 3.65x — return on ad spend — as the headline efficiency metric, alongside the revenue and spend figures. ROAS is a reported, platform-influenced metric, and independent practitioners have spent 2026 warning that such figures can be inflated; readers should treat it as the company's claim, not a verified independent measurement. Still, the direction — spending less and attributing more — is the point of the strategy regardless of the exact multiple.
Third, rebuild the conversion engine. Looking ahead, AVO plans to launch a completely redesigned e-commerce platform during the first week of October. The platform is being developed by newly appointed board member David Sosnowski, who previously served as the growth architect at athletic apparel brand Vuori — during a period in which, according to the company's announcement, Vuori experienced a 2,400% revenue expansion. The redesign targets conversion rates, average order value, and customer engagement. CEO Hil Davis said the company targets a 5x ROAS following the October launch, which would allow DBG to scale digital advertising investment alongside future revenue growth.
Results as reported
For the August 1–September 11, 2026 window, Digital Brands Group reported:
- 221% year-over-year revenue growth for AVO.
- 78% reduction in digital marketing spend versus the same period in 2025.
- 3.65x return on ad spend during the period.
- 442% increase in weekly net revenue from Week 1 to Week 6 among universities launched in 2026.
"We are encouraged by the combination of strong revenue growth and substantially lower marketing expenditures," said Hil Davis, chief executive officer of DBG. "The performance we are seeing across AVO demonstrates increasing efficiency in how we are acquiring and monetizing customers."
Two caveats deserve emphasis. First, these are company-reported figures from a press release; they have not been independently audited, and the ROAS metric in particular is subject to the attribution debates currently running through the industry. Second, whether the company can sustain the efficiency while scaling spend back up — Davis's stated plan, contingent on the October platform launch — is the real test. Efficiency at low spend is easier than efficiency at scale.
Key lessons
Affinity is cheaper than persuasion. AVO's structural advantage is licensed demand: customers who already want what the brand sells. Brands without that advantage can still learn the principle — invest in the demand that exists rather than manufacturing demand that does not.
Cutting spend is a strategy, not a retreat. A 78% reduction in digital spend was not a sign of distress; it was the removal of waste. The lesson is to audit every dollar against attributed return rather than treating last year's budget as this year's floor.
Efficiency must precede scale. Davis's plan is instructive: get to 3.65x ROAS at low spend, rebuild the platform to improve conversion and average order value, and only then scale spend toward a 5x target. The sequence — efficiency first, scale second — is the opposite of how most growth marketing is practiced.
Treat reported metrics with professional skepticism. This case is also a lesson in reading growth announcements: demand the weekly progression, ask about the baseline, and remember that ROAS is an attribution claim, not a cash figure. The AVO numbers are strong; they are also unaudited. Both things are true.
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