What is D2C?
In a world of acronyms, this one stands for Direct-to-Consumer. To add to the glossary of terms, it can also be known as B2C or Business-to-Consumer. As the longhand version suggests, this refers to the e-Commerce retail process that excludes all third parties.
Is D2C right for you?
It’s important to remember that this doesn’t have to be an either/or solution. Establishing a D2C arm doesn’t have to result in dissolving a more traditional model. On the contrary, the two can – and do for many businesses – work hand in hand. That said, there are several scenarios when direct-to-consumer could be the suitable model for you. They include:
- Your business is in its infancy, and you don’t have the capital or security to enter into iron-clad agreements with third parties.
- Consumers have already started to come to you. That’s probably the strongest indication of all!
- More sales – if you’re looking for new revenue streams, this is certainly one to consider.
- You’re losing your voice. As your brand progresses through the retail train, the messaging or positioning is diluted, and the finished product isn’t speaking to consumers how you want it to.
- You or your business is increasingly interested and successful in communicating via social media.
What are the benefits of D2C?
According to Barclay Bank, in 2020, D2C sales were valued at £96B for UK manufacturing, which is anticipated to grow to £120B by 2023.
- Grow a direct relationship with your customers
The D2C model allows you as the brand or distributor to hear straight from the horse’s mouth – no tweaking of feedback to soften the blows or make it more politically correct. Moreover, you can also communicate directly to the customer instead of relying on third parties to communicate ‘on brand’. And we all know the value of good relationships with our customers. Priceless.
- Maintain control
Once the product leaves the packaging depot, so does most of your control and decision-making. When the product lands on the shelf, where precisely it sits, and whether it is supported with any on-floor marketing, these are all decisions made mainly by others. Crucially, however, these are the decisions the consumer sees and experiences first-hand.
- Additional revenue stream
If your business is already established on a more traditional model, introducing a D2C arm will provide you with a new way to make sales.
- Low barrier entry to the market
Fewer players mean fewer hoops through which to jump. Time to market, red paper, policies, procedures, and costs can significantly reduce when you go directly to the customer.
What do you need to make D2C a success?
Launching a D2C business, or arm thereof, does not require an expansive ‘to-do’ list. On the contrary, as we’ve already read, one of its benefits is a swift and agile entry into the market. So, here are the most important steps you’ll need to undertake:
- Launch a webshop
You need a fully e-commerce enabled website that won’t cost a fortune and can be built quickly and cost-effectively. Our BikeExchange webshop platform features CRM (Customer Relationship Management) software allowing you to communicate easily with the customer. Moreover, BikeExchange provides a stand-alone solution or part of our online marketplace. This one-stop-shop approach enables you to have an independent D2C presence and be part of a broader, bike-focused online retail environment and community.
- Distribution
Ensure your operations can efficiently distribute directly to the customer. You’re no doubt up against the rapid-pace dispatch from online giants such as Amazon, so time is of the essence.
- D2C marketing
If you’ve not already done so, establish your social media accounts and give these as much oxygen as possible. Moreover, ensure that they, too, are eCommerce enabled so you have a truly omnichannel offering.
Explore ways to build a consumer database quickly. For example, this might involve cross-promotions with like-minded brands, an advertising campaign (goals focussing on database opt-in), competitions, and affiliations with industry influencers.
- Customer service
Ensure your customer service team (even if it’s only one person strong) is fully up-to-speed with your brand guide, style, tone of voice, product descriptions and business operations. They have to be the mouth of the business; they need to be reactive, warm, able to deal with tricky situations and level-headed and lateral thinking!
BikeExchange every year welcomes more and more brands and distributors onto our platform daily. So if you know your business can gain from a D2C model, let’s chat! We know how to maximise the benefits and make your entry to market smooth and swift, so contact our team today.
