Direct to consumer brands (DTC or D2C) know that D2C isn’t just an emerging change in retail, it’s also affecting the consumer products industry. As social media and mobile technologies are redefining consumer buying habits, the linear model of selling goods through retailers is breaking down.
Today consumers want a personalized approach and personalized products of a good quality, and at a fair price that they can get hassle-free, no matter what channel they use.
For consumer product companies, selling their products to retailers is really not enough – in fact this might even kill the brand. They need to start connecting with their consumers directly if they want to stay relevant to them.
But how? And how do you integrate the customer journey into internal processes while streamlining the operations to deliver seamless, meaningful, and relevant content and offer to consumer?
One thing is certain: A strategic approach to route markets is needed for the manufacturer to build the brand, from traditional, modern trade to direct to consumer.
Direct to consumer brands that shine: DTC examples
Ask yourself: What do companies like the following direct to consumer brands have in common?
They make quality products, you might say.
What else? They make affordable products.
What else? Do they sell them directly to consumers too? Bingo!
Smaller consumer goods start-ups are making a big disruption in the marketplace by offering new experiences with quality products that consumers can simply fall in love with. These companies understand very well that choosing one product over another on a retailer’s website might end in winning a sale, but with it, they lose the opportunity to build a relationship with a consumer.
That’s why they are offering a more direct approach and building a more natural and lasting relationship with their customers. The direct to consumer brand model allows them to simply take complete control over their:
- Sales velocity
And they’re successful at it. Away shook a sleepy luggage market with their affordable carry-ons, and in less than three years, sold over half a million of them. Similarly, Dollar Shave Club built a successful billion dollar empire by simply offering a better grooming/shaving experience at a more affordable price.
DTC isn’t just for start-ups
Recognizing that competition never sleeps and constant innovation is necessary, big brands are also entering into the direct to consumer fray.
Retail giants like Nike and Levi’s are now rapidly searching to find out what their customers want, how they want it, and what their value proposition is – and they winning big.
- Nike: Nike’s D2C sales are estimated to reach $16 billion by 2020.
- Levi’s: The iconic denim wear retailer hit a two-decade sales record as direct to consumer helped them increase their revenue by 22% globally in 2018.
Diversifying product offerings and scaling up is just one example of how DTC brands are increasing sales and expanding customer bases. While the most popular D2C brands began with a single, exclusive product, they’ve discovered the benefits of offering complementary products to their lines.
The bottom line: In order to protect your bottom line, the direct to consumer model must be incorporated.