The Direct-to-Consumer (D2C) strategy is rapidly becoming a popular route for manufacturers and brands to enter the market directly instead of as a middle-man entity.
The benefits of going direct to the consumer are several, but naming a few, going D2C leaves out the barrier between the producer and the consumer. It gives the producer greater control over its brand reputation, sales and marketing tactics. In addition to this, it helps the producer directly engage and learn from their customers. While the barriers to entering the market as a startup D2C brand are comparatively low, you must remember that you are competing against some retail giants like Walmart and Amazon, which have already established a massive customer following.
It is vital to have a strategy that helps you become a distinguished brand and disrupt the status quo.
Some direct-to-consumer (D2C) tips:
- Focus on the product and marketing efforts on the customer’s pain points.
- Improve digital marketing using data
- Identify the everyday item making them more affordable.
- Develop a subscription-based model.
- Take a content-first approach
- Simplify choices and options
- Offer easy and no-fee returns
- Incentivize customers to spread the word
- Make use of celebrity influencers
- Create a viral video
- Use micro-influencers
- Create a virtualized experience
- Ask customers to make content
- Disrupt social media with memes and infographics.
- Implement an aggressive SEO campaign.
- Deliver end-to-end customer experience
- Facebook marketing
- Join or start a community
- YouTube ads
- Instagram ads
- Utilize fulfillment companies
- D2C Checklist
What is direct-to-consumer (D2C)?
Direct to consumer or D2C is a low barrier-to-entry e-commerce strategy allowing manufacturers and brands to sell directly to the consumer. It removes the conventional method of negotiating with a retailer to get the product on the market.
Within D2C, brands directly sell to the consumer through an online platform or medium.
Going D2C has several benefits, with competitive pricing crucial for consumers. Other benefits include having better direct contact with consumers, which helps to understand them better and freely experiment with the latest product releases and test them with an aspect of consumer-based to gain the feedback. However, going D2C is not easy. It is significant to have a D2C-specific strategy noticed by the target market.
Things to consider when going D2C
If opting for D2C sounds appealing to you, and you are looking to leverage the model as mentioned above, there are some common pitfalls to watch out for when going direct-to-consumer:
- Ensure your company is 100% ready to make a shift to D2C
Going D2C is not something that happens. It will need some work on your part.
Businesses looking to switch to a D2C model involve investing in training and enabling the employees that evolve the current processes for developing new ones. Overall ensures that the business can operate profitably and efficiently under the D2C model.
Additionally, companies also need to have a clear rationale as to why they decided to switch to D2C in the first place. Moreover, they need to be well prepared to communicate the explanation to the team and the customers in ways that matter to them. Without the clarity and transparency in place, there is little chance of the D2C endeavors being successful.
However, communicating openly with the team and the customers ensures everyone is involved and impacted by the switch and 100% prepared for it.
- Prepare your partners
For companies that decide to use a D2C model, where they sell wholesale to retailers and then directly to individual consumers, there is a risk of alienating the retail partners in making this switch.
If you are selling D2C, it makes you a competitor to the retail partners selling your products. When given a choice between purchasing products through a retailer or directly from you, the consumer will more than likely opt for the latter.
While you do not want to steal business from the retail partners, you also do not want to ease the products collecting dust on the retail partners’ shelves, either.
Instead of entirely severing ties with the retailers, dig deeper into a partnership to figure out a more profitable way to move forward. It involves selling only specific items in D2C and delivering wholesale shipments of high-performing products to particular retailers. It also involves having the partner retailers take a more proactive approach in promoting your products.
How do D2C companies approach marketing?
The apparent difference between a conventional manufacturer and a D2C company is that D2C companies and firms take complete control and ownership of the end-to-end customer experience.
The topside to this added responsibility is manufacturers that go D2C are free to market their overall brand and its products as they see fit or as they know they will most efficiently engage the audience.
D2C companies have complete control over:
- How to build relationships with their customers
- How to deliver value to the end-user consumer
- Who their customers are
As we discussed earlier, one of the main reasons to go D2C is that the conventional retail experience fails the modern consumer. So it does not make sense for D2C companies to replicate the played-out consumer experience of past days.
Going D2C frees companies from the constraints of the conventional business model, allowing them to cater to their target customers the way they want to be treated. It means providing them with engaging and top-quality content, treating them to personalized services and doing something else entirely. Going D2C allows you to become more engaged and connected with the end-users.
Maximizing the digital channels
Most of the strategies mentioned above will not work without a ship-shape digital experience. It helps D2C brands turn into global companies with distribution and sales.
The traditional way relies on heavy customization and many plugins, and the solution is unstable and unscalable.
It helps increase the conversion rate and frees up the resources to concentrate on the marketing and running campaigns.
There is a constant race to meet changing consumer expectations. D2C channels provide instant access to the ownable consumer data like buyer behaviors and habits.
By using the D2C model, you unite teams behind a common goal to deliver excellent shopper experiences.