Five lessons traditional brands can learn from D2C players

Rajiv Kumar Aggarwal, Founder and CEO, StoreHippo

Rajiv Kumar Aggarwal, Founder and CEO, StoreHippo

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‘Change is the only constant.’ One of the many areas where this age-old adage still stands true is business. Rapid technological changes, globalization and the pandemic have changed the business landscape like never before.  The new normal has made businesses take note and adapt according to the changed market conditions and user demands.

While businesses competed on products and prices earlier, the battleground has now shifted to user experience, customer service and buyers’ satisfaction. To offer the most memorable buying experience to their customers, brands are increasingly adopting the D2C model. The D2C or Direct to Customer model essentially involves brands reaching their customers directly and cutting the need for middlemen in the process.

Over the period of time, the model has been the go-to strategy for businesses enabling them to directly sell their offerings to their customers. The Direct to Consumer approach paves the way for unprecedented growth and expansion of the brands and also offers them a plethora of benefits. These range from low costs, quick turnaround time of delivery to direct communication with the customers and offering them the top-notch quality of products.

The best part of D2C is that this model can be adopted by a business of any scale. There are several practices that traditional brands can learn from their D2C counterparts and implement as well to better their business models. Some of such practices are listed as follows-

  1. E-commerce is the way forward for business

Technology has been at the heart of almost all innovation that has overcome the world over the last decade. The COVID pandemic and the changed buyer habits, too, have accelerated the need for tech in all spheres. One can easily say that technology and digitization are the way forward in all fields, including shopping and commerce.

E-commerce has now become an integral part of our lifestyle and rules various aspects of our lives; be it reading newspapers on our mobile phones, ordering groceries online, or booking cabs, and opting for teleconsultations with the doctor. From luxuries and high-end products to the most basic of necessities, all are being sold and bought through the internet especially the e-commerce platforms nowadays.

A key reason for the success of D2C is the ease and directness of communication between the buyer and seller that it facilitates through its online channels. Additionally, omnichannel convenience has been a principal factor contributing to the growth and acceptance of E-commerce. Customers have become addicted to the comfort of online shopping that allows them to stream and browse across brands all on one platform. Further, the secure and quick payment gateways too have played their part in luring the customers the E-commerce way. As the internet penetration increases and the reliance and trust of people towards online shopping channels increases, E-commerce has become the new normal.

E-commerce is indeed the future. Traditional brands should seek to leverage the power of the internet, just like D2C brands, to enhance their scale of operations and customer base.

  1. Customer data is key to customer service

The best way to serve the customer is to recognize a pain point and offer a solution for it. D2C brands are heavily data-centric. They keep a keen eye out on customer preferences and problems and translate the solutions into their products and services. Since they contact their customers directly through in-house websites and platforms, it becomes easy for them to record and analyze customer data through digital tools that provide them systemized and streamlined insight into consumer demands and tastes. This data and its consequent interpretation are then used to innovate and create offerings that best serve the customer’s interest.

Traditional brands too can adopt this strategy to serve their customers better. While traditional brands could not possibly have as much data as a D2C brand, they can still try to record and analyze customer patterns as much as they can and use the knowledge to improve their offerings.

  1. Need to stay atop trends

The internet is omnipresent and omnipotent, revolutionizing our businesses and our lives in a significant manner. It offers various benefits to businesses including enhanced convenience of operations, saved resources, and a plethora of opportunities to grow. Due to this very reason, most brands opt for online selling of their products while leveraging the power of technology.

Following the D2C approach not only boosts their reach but also allows them to efficiently make a pitch about their offerings to several potential customers all at once. Additionally, the availability and accessibility of smartphones and the internet are increasing with time. This will further expedite the pace of digital adoption amongst businesses in the times to come and it is anticipated that technology will continue to be an important part of their operations. Hence, it would be appropriate for traditional brands to adopt the D2C model.

  1. Adopting the right approach for customer engagement

For a brand to make it big, it needs to connect with its customers via the right channels. It is critical for them to know how to reach its target audience and analyze what appeals to them. D2C route enables brands to adopt an omnichannel approach that helps brands in providing customers a unified shopping experience across all touchpoints.

However, over the period of time, multichannel strategy is also picking up pace in the D2C space. This concept blends the customer experiences and gives customers various choices to engage with the brands via the channels that they prefer. Once D2C brands understand which channels resonate best with their target audiences, they optimize those routes to maximize their sales. Adopting the D2C approach can drastically boost the visibility and range of brands. Hence, traditional brands can and should strongly consider embracing the Direct to Consumer model.

  1. Personalization is important

In today’s day and age of globalization and the internet, customers have a wide variety to choose from. The growing choices have pushed the brands to greatly personalize the shopping experience in order to garner customer interest. Hyperlocal e-commerce is a trend that has really helped in this arena. Hyperlocalization basically involves altering the firm’s offerings to appeal to the local cultures and norms.

With their headless architecture which helps in devising omnichannel strategies, D2C brands are able to offer personalized purchasing journeys to their customers across multiple devices and channels. This personalization strategy has emerged to be a necessary ingredient for D2C brands as it helps improve customer experiences and boosts loyalty. This approach helps the brands offer differentiated experiences to their customers and gives them a competitive edge in the market. Due to these benefits, traditional brands should opt for the D2C route as it will help them eventually pave the way for building customer relationships and engagement that are personal, authentic and long-lasting.

Comprehensive solutions for sales generation

D2C approach offers comprehensive solutions to sell across diverse channels like online, offline, mobile web and apps, social commerce, etc. With the help of agile battle-tested digital solutions to build online multi-vendor marketplace multi-store network experiences, traditional brands can easily manage their existing set up digitally and introduce efficiency at every level. and  Traditional brands can also opt for multilingual websites just like D2C brands to connect and engage better with their customers in their preferred language.  Traditional brands can go beyond borders by offering multi-currency payments to facilitate quick and easy payments. Traditional brands by incorporating these features of the Direct to Consumer path can scale up their business significantly.

Summing Up

The D2C model has existed for quite a while but has gained prominence only recently. Its exponential growth and popularity can be principally attributed to the enhanced ease, personalization, and security that it offers to the customers.

Furthermore, the growing internet penetration and digital adoption in businesses across industries have played a pivotal role in driving brands to adopt the Direct to Consumer route. This approach has been well received by industries and has garnered positive outcomes ranging from personalized customer experiences, customer engagement to quick delivery of products and sales generation.

There are various valuable lessons that traditional brands can learn from D2C brands and leverage the model’s potential as well as implement their learnings to tread on the path of success!

The above article is authored by Rajiv Kumar Aggarwal, Founder, and CEO, StoreHippo.

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