Direct to Consumer (D2C) is a marketing strategy where brands sell their products or services directly to end users. This approach is an effective and practical alternative, especially for small and medium-sized brands. It allows them to engage customers without relying on intermediaries like retailers or online sales platforms. This article provides insights into how this strategy can be used to achieve success. Here are some key statistics that highlight the potential benefits of a successful D2C strategy:
Statistics
- According to Statista, D2C eCommerce sales in the US reached $161.5 billion in 2023.
- United States D2C eCommerce sales, including both digitally native and established brands, grew by 48.5% in 2023.
- In 2023, D2C eCommerce shops generated $111.54 billion and accounted for 14.0% of total retail eCommerce sales, according to an eMarketer survey.
- 81% of consumers plan to shop for direct-to-consumer brands.
So, how can you position your brand to reap the maximum benefits of D2C? Read on to discover 10 steps to build a successful D2C brand in 2023
10 Steps to Build a Successful D2C Brand in 2023
More and more businesses are adopting the direct-to-customer approach to offer a personalized brand experience. To ensure your brand’s success in 2023, follow these 11 steps to build and implement a successful D2C or DTC brand.
Step 1: Craft Your Brand Story
Your brand’s story should convey how your product or service can make a difference in customers’ lives. It should be compelling, nuanced, and resonate with your target market. With a direct-to-customer business model, your brand’s story takes center stage since you deliver the product or service directly to customers. To engage customers and build brand loyalty, you must communicate how your brand can benefit their daily lives. Crafting a compelling brand story around your products or services can help customers remember and stay loyal to your brand.
Step 2: Identify Your Customers\’ Essential Needs
Marketing is a crucial aspect of D2C, and it’s essential to prioritize your customer’s needs to deliver a successful campaign. Ask yourself the following questions to understand your customers better: – What motivates customers to take the next step in the sales process?
- What challenges do customers face at each step of the process?
- How can customers overcome these challenges?
Social Commerce
Social commerce has become increasingly popular, with 41% of respondents reporting that they made a purchase through social media in the last six months. Many successful brands have embraced this trend, such as Warby Parker, an eCommerce company that used social channels to build its brand. The beauty and makeup industry has also capitalized on social commerce through platforms like Influenster, which creates a community forum to encourage social purchasing. As a D2C brand, following this trend is crucial to reach and engage with customers effectively.
Step 3: Be Present Where Your Customers Are
Merely offering products or services is not enough – your brand needs to be easily accessible to your customers. When customers think of your brand, they should immediately understand why and how you can add value to their lives. Failing to be accessible can lead to missed opportunities, despite having an excellent marketing campaign or a credible reputation. Being present where your customers have several benefits, including: – Facilitating immediate communication on social media
- Allowing customers to connect with people, rather than just the brand itself
- Making it easier to follow up with customers
- Encouraging transparency in conversations
Step 4: Analyze Your Market Budget
Analyzing your market budget can help you identify critical factors influencing your business’s present and future direction. Determining the most effective marketing strategies and making necessary changes can save time and grow your business. Additionally, analyzing your budget can help you identify cost-efficient ways to engage with customers. Competitors within your industry can significantly impact your budget, and it’s important to recognize that competition exists not only among brands but also among stores within the same brand family.
Step 5: Prioritize Customer Lifetime Value (CLTV)
Prioritizing customer lifetime value can help you maximize upsell opportunities, leading to more profitable purchases and nurturing positive relationships with your customers. The idea behind CLTV is that if you can increase profits and maintain a good relationship with your customers, you are likely to see more upsells, ultimately increasing your revenue and ROI in the long run. The following strategies can help you achieve a high CLTV: – Knowing your customers well
- Identifying more profitable customers
- Driving profitable retention at scale
- Allocating your budget to target your ideal customers.
Step 6: Build Your Audience
To effectively build a successful D2C brand, collecting email addresses and cell phone numbers to contact your audience is crucial. Emails allow for more personalized communication with online consumers, while cell phones provide a way to connect with potential customers at any time of day. Integrating both email and cell phone lists into your business systems can help create an account-based marketing strategy for D2C brands.
Grow Your Marketing List
Engaging with your current customers is the best way to grow your marketing list, as your message is likely to resonate with them since they already buy from you. Consider running contests and promotions to create excitement among those who have already made a purchase, and offer them substantial perks such as click-and-collect shipping, coupon codes, or other promotional methods that suit your company’s style. Additionally, list segmentation is a powerful tool to reach even more subscribers. By segmenting your list based on key demographic and behavioral data points, such as gender, age, education, income level, products of interest, and preferred online shopping methods, you can tailor your content and product offerings to appeal to each segment specifically, thereby increasing the success rate of your recent sales.
Step 7: Develop an Influencer Strategy
To successfully reach your target audience with engaging content that is unique and relevant, it’s crucial to have a solid influencer strategy. Although social media channels can be effective, influencers have greater clout due to their large following and brand recall. Utilizing influencers to promote your product or service can be highly beneficial. Therefore, it’s essential to build an influencer strategy, which includes identifying target influencers and ensuring they are accessible on their social media platforms. Consider the following types of influencer marketing strategies: – Gifting
- Guest Posting
- Sponsored Content
- Co-created Content
- Social Media Mentions
- Contests and Giveaways
- Affiliates
- Brand Ambassadors.
Step 8: Choose the Right Fulfillment Vendors
Choosing the right fulfillment vendors is crucial when starting any business. When selecting a fulfillment vendor for your brand, consider their products and services and match your budget accordingly. Working with experienced fulfillment providers can be advantageous for new businesses to avoid potential disappointments. Shipping vendors play a vital role in the direct-to-customer fulfillment process, and evaluating the best eCommerce fulfillment providers for your eCommerce business is essential. Consider the following factors when choosing a fulfillment vendor: – Comparable size
- Reliability
- Ease of working with
- Deals in your target market.
Step 9: Create a Marketing Plan
Creating a performance marketing plan for a successful D2C eCommerce store involves more than just developing a website and expecting revenue to start rolling in. It requires aggressive digital marketing strategies, and although it can be a confusing, time-consuming, and expensive endeavor, it is worth it on the grand scale of things. To drive results, you need to create a performance marketing strategy fully integrated into your eCommerce store with best practices for product launches, social media activities, SEO strategies, and all the involved apps. Follow these steps to create a performance marketing plan: – Define your brand
- Create buyer personas
- Set your business goals
- Choose your digital marketing methods
- Set your budget
- Measure results.
Step 10: Integrate Customer Service as a Fundamental Form of Branding
Well-branded customer service plays a crucial role in building your brand. Customer service helps you stay on top of the game and assists you in anticipating what is likely to trend and changes in customer tastes. For example, one of the most valuable companies globally, Apple, operates a 70% D2C model and understands the role of well-branded customer service in business growth. They have strengthened their customer service with innovative ideas that ensure their customers will continue to purchase from them. Building trust among consumers is a crucial step that helps companies grow faster because customers feel they’re getting more value out of their time and spend more time engaging with the brand through multi-channels. Integrate customer service as a fundamental form of branding to improve customer satisfaction and loyalty.
Step 11: Prepare Your Staff to Meet D2C Goals
The key to a successful D2C brand is to engage the services of competent staff aligned with your brand culture. The D2C brand model involves more direct communication with final consumers. If your brand speaks in robotic advertising or unconvincing marketing language, it won’t translate into actual conversions. Developing a robust marketing strategy around your staff will help build a strong brand that keeps customers coming back. You can prepare your team to meet goals by implementing the following principles: – Train and retrain your employees for better performance
- Task people with meaningful work aligned with their skills
- Provide positive feedback often
- Offer welfare packages like incentives, promotions, and encouragement to your staff.
Conclusion
In the world of direct-to-consumer brands, building trust with consumers who understand your company’s mission, vision, and values is crucial to success. If you’re interested in launching a D2C brand or want advice from Shopify Plus experts, don’t hesitate to schedule a call with our eCommerce professionals today.
