Motive of direct to consumer or direct to customer selling is “providing the best customer buying experience across all the platforms”. Even Amazon has been stressing on D2C and advising its sellers to adopt the D2C approach.
Not only Amazon, but many big enterprise ecommerce giants, who once rely on physical presence, are also transitioning to the D2C model.
Want to know which top companies have shifted to the D2C model? Let’s uncover them-
A wildly popular apparel and fitness brand that gained media coverage for its recent shift to the D2C model after the pandemic. After shifting to D2C, Nike saw that 33.1% of sales were from the D2C transition in 2020 i.e. $11.5188 billion (33.1% of $34.8 billion). (Source: eMarketer)
A popular D2C men’s grooming brand that became a multi-million dollar company after running a video ad campaign across multiple social media channels. What approach drove their growth? Web-only retail approach with direct distribution model and a killer social media marketing, they were to scale their business. Moreover, it offers extreme shopping personalization by suggesting products based on individual requirements.
A D2C personal care brand that claims to produce chemical and toxin-free products for moms and babies. With competitors like Dove, Loreal, Mamaearth was able to conquer the market with 5 million consumers in 500 cities across India.
The tech giant, during the pandemic, opened an online store in India to directly offer its products to the consumers. Moreover, they even have planned to open a manufacturing unit to produce iPhones worth $40 Billion in India.
It is proven that companies who are following the D2C approach are able to boost their revenue and customer trust.
So now it’s time to break the shackles i.e. bust the D2C misconceptions.
Table of Contents
- 5 Common misconceptions about D2C that you need to crush
- 1. Our model is working fine, D2C will be lots of effort
- 2. Customers prefer to buy big orders in offline stores
- 3. Personalized shopping experience to each customer is difficult
- 4. Low prices drive online sales
- 5. There’s no way we can beat huge marketplaces
- Statistics that prove direct to customer model is profitable
- Why do customers prefer buying from D2C brands?
- Final words
Many Enterprise ecommerce companies often ignore shifting to D2C ecommerce as they believe it requires a lot of work. Like managing payments, orders, delivery, resolving customer queries, aggressive marketing, etc. With this thinking, businesses can miss the huge advantage of access to customer data.
Reality: You can easily handle all your customer data and other transactional data. But how? With the best ecommerce platform, you can easily monitor your data in one place. Such platforms accumulate all your data and give.
StoreHippo is a cloud-based platform that streamlines all your data on a single dashboard. You can track orders, manage deliveries, initiate returns, monitor payment, etc with a single click. You can even integrate your CRM, ERPs softwares for better management.
StoreHippo inbuilt data analytics tools help you in making critical marketing decisions. Analytics tools give detailed and organized data about D2C enterprise ecommerce store performance. It shows you monthly sales growth, orders placed, website traffic time spent on a website by a user, etc.
Reality: Well, it depends on how exceptional your customer experience is. Based on customer experience, customers will decide whether to trust you with bulk orders or not. Moreover, with a flexible return/exchange policy, you can easily assure conservative buyers of future loss (if any).
Nowadays, customers want hassle-free shopping experiences on both online and offline stores. In simple words, they want -
Flexibility to complete the purchase on any channel
Fast and convenient shopping on any device
Personalized buying journey for unforgetful brand experience
How can you address these wants? Through omnichannel ecommerce, you can offer a remarkable D2C customer experience anywhere across the globe, regardless of customer shopping channels (online or in-store).
An omnichannel infrastructure identifies the customer touchpoints and customizes their buying journey. Hence, your enterprise ecommerce platform needs to have omnichannel commerce compatibilities to succeed.
Reality: In D2C, businesses get accurate data about customer preferences. Thus, customizing the customer shopping experience at every buying stage is easy. As you get ready-made data into your system.
To offer personalization, switch to the best ecommerce platform that simplifies data management.
StoreHippo offers you advanced tools and technologies to offer extreme personalization. Let’s explore them-
With marketing tools like push notifications, email marketing tools, discount engines, you can roll out custom offers for each type of customer. Push notification is a feature to create relevant notifications for mobile app users and pushing them towards purchase. An email marketing tool is to reach and convert customers by sending relevant emails about a sale, cart abandonment, discounts, etc.
Headless commerce infrastructure
With headless technology, you can offer personalized content to each customer based on their location and channels. In short, you can customize your store frontend design/pages without touching the backend codes.
Mobile Commerce infrastructure
StoreHippo is a mobile commerce platform, which by default creates a mobile-friendly enterprise ecommerce site. Hence, freeing large businesses from creating a mobile version of the same site.
A common D2C misconception that is deep-rooted in the mind of large businesses is -
Low prices = More customer = More sales
Having low prices does not guarantee high orders. Let’s take an example to illustrate the statement.
Suppose you sell skin and hair care products online. A customer comes to your enterprise ecommerce site to buy hair oil, as he is suffering from uncontrollable hair fall.
He is looking for a hair oil that can promise measurable results in controlling hair fall. Before adding a product to the cart, he looks at product reviews, ratings, ingredients and online brand reputation. After verifying all the elements, he took action to purchase the product.
Takeaway: Valuable customers are ready to pay high prices if your product can solve their problems. How to create demand for your product? Simple, reach out directly to customers on their favourite channels. Try running social media ads, implement enterprise ecommerce SEO, influencer marketing and more for a better reach.
It’s natural to be intimidated by the kind of traffic marketplaces like Amazon, Alibaba, and Flipkart get. But the thing is, you don’t have to beat these marketplaces! Using the D2C model and leveraging your existing dealer network you can also build an online marketplace of your own and fulfill the order using your dealers and suppliers.
Reports suggest there has been 88% increase in orders on D2C brand websites, compared to 32% growth in order volume on ecommerce marketplaces. This reinforces the fact that brand awareness in customers is increasing. A large number of online buyers prefer to buy directly from brand websites rather than from retailers selling branded products on online marketplaces. Let’s look at how you can leverage your brand’s D2C marketplace to your advantage:
Penetrate new markets: Once you have your own online marketplace along with your marketplace app, you can easily onboard dealers and suppliers from new markets. By making registration and selling easy and automated you can easily reach new markets through your newly onboarded suppliers. You can also enable a variety of seller/supplier based discounts to keep your customers engaged and coming for frequent orders.
A/B Testing: Try split testing your product list on your D2C marketplace to see which products, geolocations, promo offers convert better. The report will help you make data-driven decisions about both your star and non-performing strategies. After all, your decisions should be rooted in statistics and not in vague assumptions or intuition.
When planned strategically, having your D2C website or marketplace yields rich dividends. Nike is a proof, as the brand totally stopped selling on online marketplaces and eventually saw a 16x boost in its D2C order volume. All you need to build and grow your direct-to-consumer marketplace is a comprehensive D2C solution like StoreHippo that comes with inbuilt solutions for Direct2Consumer model along with a well rounded vendor management system.
Let's take a look at statistics that further strengthen the argument for D2C model
D2C e-commerce sales are expected to touch $21.25 billion in the year 2021
24%-30% growth in sales of D2C brands from 2019 to 2021
40% of buyers plan to buy more from D2C brands in the coming five years
Sectors like beauty and wellness, fashion apparels, FMCG witnessed a high penetration ratio into D2C selling.
Source: Business Insider, Statista
Here are the top reasons that can help your enterprise ecommerce brands in building D2C strategy -
Better product quality
Direct communication with the brand
Unique shopping experience
Low and transparent prices
Want to get more profits out of your enterprise ecommerce store? Then, let go of all misconceptions and leverage the power of D2C. Why? Because -
Unlimited customer reach
Complete Control over prices
Quick selling and buying process
Low capital expenditure
Less overhead expense
Comprehensive data about customers
To successfully adopt the D2C model, you first need the best ecommerce platform that offers an array of advanced features.
Looking to explore the platform? Then, you can try StorehIppo, which is a DIY ecommerce solution. You can launch a beautiful D2C enterprise ecommerce site without writing code. Neither do you need design experience, as it gives you pre-designed themes and templates for creating storefront and product pages.
Sign up for a 14 days free trial to get Instant access to StoreHippo website building tools.