- During the pandemic, more customers are utilizing the direct-to-consumer retail experience.
- Brands that personalize their DTC offerings are more likely to retain new customers in the long run.
- Find your niche, make returns easy, and embody socially conscious values that speak to your customers’ identity.
- See more stories on Insider’s business page.
As the collapse of the traditional retail model progresses, consumers by and large now defer to shopping online for everything from daily essentials to luxury purchases, paving the way for direct-to-consumer (DTC) brands to take the place of traditional retail stores.
I’ve purchased everything from toothpaste to cars online. In this heightened e-commerce landscape, consumers’ expectations that products and experiences be crafted to meet their exact needs have escalated.
To that end, DTC brands are re-targeting their sights — and their sites — on providing the perfect solutions rather than simply comparable alternatives. If you’re competing here, in order to thrive, you must be mindful of, and responsive to the latest trends and best practices.
Know your niche
In a growing market of specialty consumer preferences, shoppers aren’t just looking for an item to add to their cart; they’re looking for an experience that makes them feel seen. They want confirmation that a solution has been created specifically to meet their unique need or desire. And in order to discover that solution, it needs to be presented to them through the right channels, at the right time, and with the right tone.
DTC brands have the singular advantage of being able to offer a distinctive experience to their customers. That mindset should inform the entire brand strategy, from product development to packaging design, fulfillment, marketing, and anything else that touches the customer experience. One of my company’s clients customized offers based on the order code on a packing slip. If a customer used a first-purchase discount code, for example, that order would be packed with a postcard offering an exclusive discount on a future order. This was part of a strategy to convert first-time buyers into returning customers and build brand trust to increase satisfaction and retention.
Successful DTC brands win on the personalization front by using historical and real-time customer behavior data to recognize purchase intent, make tailored product recommendations, and create value add experiences that leave customers feeling understood, satisfied, and excited for more.
Harness the power of data
Major carriers have increased shipping rates. With shipping being one of the primary costs of doing business as a DTC brand, having visibility into transportation data provides the insights necessary to ensure optimal efficiencies, improved bottom lines, and a better experience for both shippers and customers.
Look into your shipping and billing data. With this information, identify areas where you can reduce waste, decrease transportation spending, and make better business decisions on an ongoing basis.
Make returns a cinch
More and more brands are embracing ‘returnless refunds,’ whereby customers are fully refunded for a return without actually having to return the item. This strategy ticks off several boxes for sellers including reducing carbon footprint and eliminating the return shipping and customs fees, which can end up amounting to more than an item costs to manufacture.
Not to mention, sending a customer an email that says, “feel free to keep or donate the item you were planning to return,” scores major points for customer experience and satisfaction.
Channel your efforts wisely
If you apply the “if a tree falls in the forest” philosophy to DTC, the question becomes, if a product is promoted on a platform your audience doesn’t use, does anyone see it?
Successful DTC brands provide customers with a seamless online shopping journey from research through purchase. This starts with knowing what channels customers are relying on for information. In other words, location is everything.
There are a lot of choices — social media, email marketing, search engines, affiliate networks, for starters. You can start narrowing down your channel mix by looking at factors such as your budget, competitor presence, and your bandwidth to manage efforts. Then, it’s time to test the waters. To avoid wasting time, money, and resources, you can get a good baseline by promoting only your best-sellers through the channels you’re considering.
Make an impact
Today’s savvy, socially conscious consumers flock to brands that project an image with values that reflect their own, and that’s a key insight for DTC brands in 2021. Shoppers evaluate a brand not only by the breadth and quality of its commodities, but by its reputation.
Criteria being factored into purchasing decisions today include sustainability efforts, stance on racial and social justice issues, and the standard of their customer experience. If you haven’t already, 2021 is the year to commit to a cause that speaks to your brand’s — and your customers’— identity.
DTC brands are taking commerce to new levels, creating the products and experiences they know their customers desire. By studying your core audience, you’ll gain an intimate understanding of what challenges and opportunities exist for them, providing the opportunity to convince them that your brand should be their go-to solution.
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