D2C Playbook: How Established Brands Can Win With Direct-to-Consumer Strategies
D2C, or direct-to-consumer, is a retail model that cuts out the middleman to deliver products straight to buyers. Compared to traditional retail, which relies on wholesale distributors and secondary retailers, these companies wield end-to-end control of making, marketing, and shipping their wares. This means roomier profit margins and more control over their brands.
D2Cs have already disrupted several marketplaces. Casper created an entirely new mattress buying experience. Dollar Shave Club introduced a reliable razor subscription model. Warby Parker made glasses cool. Some legacy brands have even moved partially or completely into the direct-to-consumer space, like Coach, which broke up with department stores in 2016.
At a time when brick-and-mortar sales are flat, with just 0.5% YoY growth in 2017, and ecommerce sales are booming, expected to grow to 17% of all retail sales by 2022, it’s clear that online experiences are setting the new norm in retail. Emerging D2Cs are digitally native, primed to leverage the powers of ecommerce to challenge legacy brands in every industry.
As an established brand, you don’t have to change your entire retail model to satisfy consumer demands and compete with challengers in the space. Instead, you can combine D2C strategies with advantages you already have in brand identity and omnichannel marketing to prepare your brand for the future of retail.
Strategy 1: Build Brand Loyalty Through Personalization
D2Cs primarily operate online, through ecommerce platforms and digital advertising. Unlike the traditional combination of brick-and-mortar retail and print ads, where consumers browse and buy in a relative black box, ecommerce results in data. Data is the backbone of digital media, giving you the insights you need to market effectively.
When you’re building awareness, psychographic data is indispensable, letting you move beyond simplistic demographics to target complex customer information like interests, values, and tastes. And nowhere is psychographic data more accessible than on social media platforms. Take a page out of the D2C playbook and begin customer acquisition with a robust social advertising strategy.
Finely tuned social ads will not only spread awareness faster than any out-of-home ad campaign, but they also spread awareness to the right customers. With tools that let you target values and interests, you can create a meaning behind your product that attracts consumers on a deeper level. This is core to how D2Cs establish brand loyalty. Everlane, a D2C clothing brand, broke into women’s apparel with much more than a fashion-centric identity. Their branding is based around ethical labor and transparent pricing, bearing the motto “Radical Transparency.” These clear-cut brand values unlock clear buyer personas and a solid foundation for effective digital advertising.
Once you’ve generated sound leads, digital platforms let you stay at the forefront of their minds through personalization. With customer relationship management tools, you can track where customers are in the funnel. This helps you release the right messaging in the right medium at the right time, whether it’s a recommended purchase on social, a new customer discount, or a cart abandonment email.
A personalized shopping experience isn’t just an added bonus for shoppers – it’s an absolute must for modern retailers. According to Segment, a data infrastructure service, “71% of consumers express some level of frustration when their shopping experience is impersonal.” An impersonal shopping experience could be as simple as recommending a product that the consumer has no interest in. On the flip side, small, individualized touches can encourage brand loyalty, resulting in repeat customers, positive reviews, and more word-of-mouth.
Customer data isn’t the only piece of personalization – you can also make consumers feel heard with a streamlined support system. Microsoft’s 2017 State of Global Customer Service Report found that 96% of people say customer service plays a key role in brand loyalty. Customer service isn’t unique to D2Cs, but many D2Cs invest in powerful digital support tools and tactics to complement their digital distribution models. 24/7 on-site chat support and social messaging, like Facebook Messenger, help you offer highly personalized customer service with the immediacy consumers expect of online shopping.
Many consumers also use social media to indirectly call out brands. It’s important to implement a social listening strategy so that you can identify potentially harmful detractors and respond quickly.
The Full D2C Playbook: Download Now
Download our full D2C Playbook below to discover new strategies for:
– The digital shopping and distribution experience
– Social and content marketing
– Experiential marketing
– And more
The retail landscape has evolved rapidly in the 21st century, with small brick-and-mortar stores closing, legacy brands shuttering, and ecommerce rising in prominence. Big brands need to evolve to keep up with consumer habits and expectations, and digitally native D2Cs offer the best lessons for domination in e-retail. From using data to fuel personalization to amplifying word-of-mouth through online social influence, there are several strategies and tactics that will keep established brands growing with modern retail, instead of against it.