Direct to Consumer Trends

September 13, 2019

Businesses are changing the game with direct-to-consumer marketing. Learn why retailers and other industries are disrupting digital initiatives with this growing marketing trend and join the revenue model today.

What is Direct to Consumer (D2C)?

Direct-to-Consumer or D2C is a marketing tactic that cuts out middlemen such as retailers or other comparison-shopping locations and instead showcases products right to the consumer without having to put the product next to other competing products. Direct-to-consumer marketing began with catalogs door-to-door salesmen and direct mail leaflets and flyers sent through the mail. Over time D2C broke into the digital age with strategic email marketing campaigns podcast advertisements and social media marketing aimed at selling straight to the consumer while reporting back to the manufacturer's eCommerce website.

Who Falls into This Category?

Many companies align within the D2C space but the most successful ones tend to pick a single product – (glasses for Warby Parker pet toys for Bark Box for example) – to drive all their marketing resources into a single hub eCommerce site. These companies tend to sell shipped items to homes including subscription-based products as well as individual orders. These same companies often rely on e-Newsletters and other email communication to re-engage past customers and future leads.

Drivers of D2C

D2C is driven by a wide variety of digital natives including members of Generation Z and Millennials. With Millennials and Gen-Z consumers at the forefront of the digital economy customer preferences revolve around more convenient and comfortable online shopping options. With more streamlined purchase experiences and authentic brand associations digital consumers often feel like they can research companies more extensively choose where they want to spend their money and select for quality rather than purely on price comparison. Millennials have no problem opting for large retail alternatives that speak to their priorities of low-cost convenient and seamless shopping. If the generation can purchase the products they love and have their items sent straight to their homes they’re all for choosing this versus walking into a physical retailer.

What Are the D2C Trends?

While there are many trends in D2C businesses the big ones include:

- Start small and scale to more products: Many companies choose a single anchor product heavily promote it through an eCommerce site and once it begins to take off they launch other products to complement it. A good example is the way that Dollar Shave Club began with cheap excellent razor blades delivered as a subscription and began offering a wide variety of add-ons to fill everyone's monthly boxes and plump up their orders. 

- Subscription-based products: D2C companies like meal kit delivery services rely on the fact that repeat business is implied by the entire business model creating customers that purchase their product nearly every week and get the convenience of not having to go to a retail outlet to purchase the items they need.

- Marketing driven by "simple quality:" Complexity in a market is perceived to benefit the company not the customer who wants to be able to understand and trust the product he or she is purchasing. Many of the companies succeeding in the D2C space including shoe companies like Allbirds have a central thing that they do well (high-quality ultra-comfortable shoes that are simple in their designs) and don't try to overcomplicate them with hundreds of variations and styles. Customers who have experienced advertising overload find this to be a breath of fresh air.

Current Success Stories

A wide variety of companies have made their mission to sell a single kind of product without going through other channels to get them to market. Examples include mattress companies like Leesa and Casper which market a single high-quality line of products as well as shipping the product directly to the consumer saving them the money of a mattress store taking a cut. There are also a variety of other companies disrupting industries like razors toothbrushes and other renewable needs where the value-add of the product is that it is technically an automated subscription service that brings you refills of brush heads or razor blades in the mail without you having to think about it. These services avoid the costs of middlemen while showcasing how their product actually makes it easier for customers than having to navigate the full shelves of a retail store to pick out their daily essentials.

 

Want to discover more ways to be part of the digital D2C disruption? Contact us at Excelerate Digital today and ask how we can help kick-start your campaigns.