Ever since the pandemic's outburst last year, lockdown and social distancing norms seem to rule our lives. In such a scenario, consumers increasingly prefer the online medium to fulfill their purchasing requirements. Be it shopping essentials, apparel, or even luxury goods, they purchase every product or service from the online space owing to the convenience and flexibility that online shopping offers. This has further pushed the brands to optimally utilize the potential of the digital medium to ensure the continuance of their operations and deliver what their customers want.
This shift in consumer behavior towards online shopping has nudged brands to opt for the D2C route. Converting into Direct to Consumer brands helps them directly sell off their products to their customers. Instead of collaborating with other marketplaces, they upsell their products via their own channels, be it their e-commerce platforms, social media handles, or retail stores.
Direct to Consumer Strategy of Brands
This D2C strategy offers the benefits of low costs and quick turnaround time in terms of delivery. It also ensures the provision of better quality products with minimal chances of fake or damaged products reaching the consumers.
In the present times, physical stores are experiencing a major footfall dip and consumers are actively shopping online. Hence, the dire need of the hour for businesses is to come up with strategies that boost customer retention and satisfaction and also enhance brand loyalty. Adopting the D2C path helps brands achieve these very objectives with its customer-first approach and also helps them establish a strong online presence.
Eliminating the need of selling via middlemen, the Direct to Consumer model helps garner profits on the placed orders. It also reduces the possibility of inefficiencies in the distribution and delivery processes. Additionally, businesses have complete control over all the processes right from the start to the finish, be it operations, marketing, or communication. D2C model offers flexibility in operations and opportunities to explore the multiple integrated sales channels as well. It offers brands the space to manage their operations, distribution, marketing, and promotional activities. They also gain the power to come up with innovations and curate personalized strategies so as to acquire a new customer base and retain the existing ones by offering customized and state-of-the-art experiences.
Brands Adopting the D2C Model
As per a report, India presently is home to more than 800 D2C brands across sectors. This count includes various major businesses that have successfully covered their journey from being a start-up to a well-established D2C brand. The study also states that the Direct to Consumer market is anticipated to hit the $100 billion-plus mark by the end of 2025.
These statistics depict that the aim of businesses now is to expand their e-commerce channels to capture the growing markets in India and explore the relevant opportunities via the D2C route. Adopting this path will not only enable them to have a global presence but at the same time will help them reach the untapped markets in tier II and III cities as well.
Treading on the D2C journey, brands have control over customer data which can be used to create unique, personalized, efficient, and high-end experiences for the customers. This also helps them to innovate their products and services accordingly as per the customers' needs and preferences. They can also regulate their branding and conversion strategies all under one umbrella and close their communication circle with a 360-degree approach.
Direct to Consumer comes with cost and time efficacy features and boosts sales and production. This is another major reason why brands prefer investing in becoming a Direct to Consumer brand. Since ‘the customer is the king’, they wish to provide their customers top-notch experiences and quality products along with quick deliveries. D2C path helps them achieve this objective seamlessly wherein the hyperlocal services enable delivery in both urban and rural areas as well as offer smooth and instant international shipping. In the present turbulent times, D2C is no longer an option but has rather become a necessity in order to have a competitive edge in the market over the other players.
D2C model enables businesses to provide high-end experiences to the customers and build connections with them. It helps them achieve their targets of fostering customer loyalty by customizing content and establishing transparency in their operations. This honest approach attracts the customers especially the young population as they prefer sticking around with those brands for long who connect with them at a deeper level and communicate with them without any filters.
Marking a presence in the digital space and creating a position has become the need of the hour for businesses. Hence, D2C has emerged as a viable solution for brands and has accelerated their e-commerce business. Instead of partnering with other e-commerce marketplaces, they prefer investing their time, efforts, and finances in building up their Direct to Consumer vertical. They are aware that doing so will help them gain margins, connect directly with their target audience, and will provide them control over their operational and marketing strategies. Owing to its plethora of benefits along with its ‘consumer only' and ‘digital-first’ approach, the D2C model will continue to rise significantly in India and it seems to have a promising future.