Implementing Direct-To-Consumer as a Key Part of your eCommerce Strategy
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To establish a successful Direct-To-Consumer (DTC) business, brands must understand the importance of having a differentiated product offering with a margin that allows them to capture retailer mark-ups. This can be achieved through a unique product offering, and by turning everyday products into a more premium version that is exclusive to the brand website.
Why Implement a DTC eCommerce Strategy?
We have identified four key reasons why A-brands should implement DTC as part of their core channel strategy:
- Revenue: A DTC offering allows brands to capture gross margin with retailer mark-up.
- Data: There’s a great opportunity to capture data across the operations linking to other consumer touchpoints.
- Consumer insights: Implementing a DTC strategy allows brands to capture behavioural insight on what’s hot and what’s not – as well as capturing marketing attribution and ROI for quality traffic and conversion, and consumer interest for future strategy developments.
- Control: Directly selling and distributing your own products confers a lot more brand authority across product and value proposition.
Summary of Key Learnings:
Winning Proposition: You need to be the ‘-est’ for your consumer. Brands need to create a DTC offering offering consumers the best experience possible across all potential capabilities. This will sustain your competitiveness against other players and position you as the ‘best-est’ in the eyes of consumers.
Consumer Journey: Identify the moments that your DTC webstore needs to support. With mobile-ready sites now the norm for any web developer, that means looking at not only how the site is used via desktop, but also how that brand website would be utilised via mobile, through integration with social channels and even offline interactions.
Sandbox: Create an environment for test & learn. Success don’t always look the same, keep an open mind when thinking about what success looks like. Do you want to learn more about your target consumer or maybe test a hypothesis about their demands? Do you want to gauge reaction to a new product range and proposition or is it the price sensitivity you would like to experiment with?
Platform Operations: Operations underpin your brand-specific strategy. To build a DTC proposition, we have to start looking below the waterline. DTC propositions take the same structure and operating stack regardless of category – on the whole (bar maybe ice cream and things that don’t sit nicely in a warehouse tote).
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Principal Consultant – eCommerce