Published October 10, 2021 DTC personalization strategy: A win for consumers and brands

DTC personalization strategy: A win for consumers and brands

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One thing will help brands stay nimble amid this holiday season: a solid direct-to-consumer (DTC) personalization strategy that puts first-party data in the driver’s seat. As retailers stock up on Halloween decorations and and take down back-to-school displays, brands are under pressure to get DTC right before competitors beat them to the punch.

As always, there’s a lot at stake for retailers during the holiday shopping season. Experts predict robust sales as shoppers return to stores and consumer confidence grows, but supply chain issues and shipping delays loom. Shoppers are aware of this and will be looking for deals earlier in the season to make sure that gifts arrive on time.

Getting the first touchpoint right early on is crucial to set brands up for future purchases later in the year. Personalization has emerged as the required ingredient in a DTC strategy.

Here’s what brands should keep in mind as they make their big holiday push:
  1. Personalization improves customer experience and boosts loyalty
  2. First-party data is key to delivering personalized CX
  3. Flexibility is essential for keeping up with changing consumer preferences

A DTC personalization strategy: Making growth grow

Digitally native brands grew e-commerce sales by 40% in 2020. That’s a much bigger jump than eMarketer’s prediction of a 24.3% bump. The annual growth is expected to take a dip from 19.8% to 16.7% between 2021 and 2023, but with total sales more than doubling from 2019 to 2023, this trajectory makes DTC a channel that brands must invest in this holiday season.

A DTC strategy is essential because it benefits both consumers and brands – when executed well. Brands are able to collect an ever-increasing amount of data about what their customers want and respond to. With real-time access to this data, brands can push personalized offers to shoppers on the channels they prefer and at times when they are most receptive.

This ability to personalize the shopper experience improves the customer experience as shoppers develop a closer relationship with the brand, and even increases the chances of long-term retention.

A one-size-fits-all approach simply doesn’t work in retail. DTC brands must enable a single view of the consumer to deliver personalized shopping experiences. They’re able to accomplish this and drive DTC success by effectively harnessing data and feedback.

In particular, first-party data (collected from their owned channels) helps brands better understand what products their customers want and create feedback loops to continue to meet ever-evolving needs.

You share, they share: Deliver value to earn data

Having data accessible around the clock is one of the biggest competitive advantages for D2C brands.

Retail has elevated from a focus on transactions to primarily relationship-based. Data is essential in this transformation because it enables brands to create personalized, elevated customer experiences. But it needs to be a two way street: brands must incentivize customers to share more data by creating a value exchange with the ultimate goal of creating long lasting connections with customers.

Discover the trends shaping the future of e-commerce HERE.

With many big box retailers like Walmart, Target, and Best Buy closed this Thanksgiving and COVID variants impacting every corner of the world, online channels will be especially important this holiday season. Brands must prepare now to offer early deals and engaging experiences online.

While online channels are paramount right now, channel preference could change over time. Retailers that invested heavily in their online shopping experience in 2020 won. But 2021 will add new challenges.

DTC strategy: Ready for whatever comes next

Brands that were able to keep their shoppers engaged this year are at a distinct advantage as we head into another uncertain holiday season. However, there’s a light at the end of the tunnel that will get shoppers back into stores at some point.

The most important thing to factor into a holiday D2C strategy is flexibility. Shoppers are very likely to lean on e-commerce again this holiday season, but it’s time to look ahead to next year to understand and build the customer experience of the future.

This is sure to be a more hybrid approach, as shoppers choose shopping channels to meet different needs. Brands must remember that the current retail climate won’t last forever and that it’s essential to be ready for future retail realities.

A strong holiday D2C strategy starts now. And the most forward-thinking brands will add an additional focus to stay on the pulse of what retail experiences shoppers might crave next.

Ready to get on the DTC fast track? Start HERE.

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Angelica Valentine

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