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What is Direct to Consumer (DTC) Marketing?
Direct to consumer marketing is a growing marketing strategy that eliminates the middleman and allows manufacturers and suppliers to sell directly to the end consumer. Businesses that independently manufacture, market, sell, and ship their own products are increasing with each day, hence DTC marketing is changing the whole business world.
How Does DTC Marketing Benefit Suppliers?
DTC marketing carries multiple advantages for suppliers. Because of the autonomy that it gives to the suppliers throughout the sales journey, they’re able to deliver a more consistent and relevant experience to their customers. They retain full control over the product information that reaches the user, the marketing processes, the supply chain, and the after-sales service.
Direct to consumer marketing makes it easier to acquire customer data to get a clear picture of buyer behavior and create more conversions while delivering unique, personalized experiences.
The direct contact and communication with customers from start to finish allows suppliers to gain key insights into the sales process, collect customer data and feedback, and address issues in their own way without a retailer being involved. Because manufacturers that use direct-to-consumer marketing directly interact with people that buy their products, brands can make improvements on their offerings based on customer feedback, ultimately improving customer loyalty.
Moreover, because in the D2C model suppliers enter the business without going through a third-party vendor, they usually start off as online stores, hence require lesser capital.
Top DTC Marketing Strategies
Create a memorable brand experience
Consumers talk about their brand experience for longer than you would imagine. If they’re able to resonate with a brand’s values or find uniqueness in it, they will remember it and also tell their friends and peers about it. Consistency and creativity aid in a great brand experience and create a memorable brand identity.
While the brand name, logo, and colors are factors used to form an identity, there are several other factors that can come into play. Remember to do thorough research on your audience so you can develop the right form of language and communication with them. For example, check out this Lipton Green Tea ad that encourages users to make healthier choices while buying groceries. They make the ad relatable for the average user in a very simple way. Although Lipton is not a DTC brand, its marketing strategies can be used for DTC brands as well and can prove to be very rewarding.
Always highlight past customer experiences
Consumers relate to other consumers. Much like how reviews play a huge part in the user’s buying decision, finding stories of consumers who have already purchased something from your brand adds relevancy and credibility to the whole buyer experience.
User-generated content (UGC) is one of the best DTC marketing strategies. By giving consumers personalized experiences with your brand, you encourage them to share this experience with others, not just online but through word-of-mouth. Word-of-mouth is a great way to gain popularity in the DTC world.
Engage customers through e-mail marketing
Personalized e-mails go a long way. By targeting customers by segment, you can create better relationships with your consumers and increase brand loyalty. By creating personalized offers, you can address specific pain points for each segment. There are multiple SaaS solutions in the market that allow this.
A great e-mail marketing strategy starts with a Welcome e-mail that hits all the right spots. Check out Interior Define’s welcome e-mail. This is one of the biggest furniture names in the DTC market. Through their very first e-mail, they let users know they can customize every aspect of their sofa. This is a great strategy to adopt as customers have different preferences and being able to customize their furniture is a great way to keep them engaged with your store.
Source: Interior Define
Following on from the welcome email, you have a long way to go for engaging users. For example, if you sell furniture and a consumer buys a lounge sofa from you, you can send them personalized e-mails of matching center tables or decor that would go well with their purchase. Upselling through e-mail brings in higher conversions.
Connect with your audience on social media, partner with influencers
Get in touch with your target audience on social media such as Facebook, Instagram, Pinterest, and Twitter. Don’t just post quality content but also engage with users. Create giveaways, polls, and carry out other interactive activities. Customers enjoy that kind of stuff from brands.
Also, take advantage of influencers. According to Nielsen, 92% of consumers trust recommendations from people they know more than advertising. Consumers believe influencer content to be more authentic than content generated directly by brands.
These influencers don’t necessarily need to have millions of followers. They can have thousands of them and as long as they come from the niche that you’re targeting, they can bring a lot of relevant traffic to your store that will lead to conversions.
With almost half the world’s population using social media, social media marketing helps you reach your target audience in various ways.
Continue marketing efforts offline
Traditional marketing can be expensive, but effective. Once you have enough revenue coming in from your online store, you can start marketing on billboards, subway, television, and radio ads. If you have a smaller marketing budget, consider advertising through pamphlets. Just like direct mail, traditional marketing tactics are still effective.
Create memorable and compelling online ads
When your marketing budget allows it, take full advantage of paid search and display ads to create awareness around your brand and come into the customer’s radar. If your brand is slightly new, you can start a PPC campaign to reach a more targeted demographic and generate valuable leads.
Collect and analyze feedback
As we mentioned earlier, DTC marketing comes with the advantage of direct communication with the consumer. This allows you to build better relationships with customers. You can learn what your customers like, where you can improve marketing and communication efforts, and act instantly on customer complaints. The feedback you receive can be used to craft better customer experiences that lead to brand loyalty.
How PIM solutions make DTC marketing easier
PIM Solutions like Apimio enable vendors and suppliers to directly upload product data to a centralized cloud database through which they can invite multiple channel partners and distribute data to sales channels. It gives vendors autonomy over how their products are presented on online storefronts.
In a DTC setting, suppliers become in charge of all product information including descriptions, images, brand assets, and more to be displayed on storefronts. By having a single platform through which they can manage and distribute data, they can become more efficient with their workflows.
Moreover, Apimio also provides data quality insights so if any digital assets are not up to industry standards, suppliers are immediately notified and they can make updates. They can invite multiple team members and assign different tasks to each. All in all, Apimio is the one-step fits all solution for suppliers just entering the DTC market and provides all features that would help them excel in the e-commerce environment.
What mobile strategies are effective for DTC marketing?
With more than 50% of online sales made from mobile, you must ensure that as a DTC brand, your store is mobile optimized. Most major brands such as Zara and Sephora have created their own mobile apps for online shopping. Warby Parker goes one step ahead with its augmented reality app that allows consumers to visualize and purchase custom glasses frames.
A great thing about apps is the in-app ads that businesses can use for user acquisition. Even for DTC brands that are yet to create their own mobile apps, mobile is the most valuable marketing medium. Some of the most promising mobile strategies for DTC marketers can be:
Cost-per-action (CPA) advertising is a model where advertisers only pay if and when an ad leads to a defined action that is pre-set by the advertiser, such as a sale. For example, DTC brands might run a CPA campaign in which adding an item to cart in the core KPI. Such a campaign could then be tied with performance marketing initiatives such as email reminders of cart abandonment or discounts that can encourage customers to buy the products.
Cost-per-completed-view (CPCV) advertising is a model which rewards consumers when they watch a complete video. Advertisers only have to pay when a video is watched through to completion. where advertisers for completed video views. CPCV advertising is beneficial as it ensures your ads are having maximum impact on users and fully delivering their intended message.
Cost-per-engagement (CPE) advertising is a model where advertisers pay for user engagement depending on the ad campaign. Advertisers only pay when the user reaches a desired engagement within the app.
5 Major DTC Brands That Are Nailing the Marketing Game
Want to see these strategies in action? Here are some DTC brands that are killing it with their marketing.
Casper that launched in 2014, has pulled off more than $100 million in sales. They’ve done this by addressing their target audience’s pain points and marketing them exactly the way they needed to. By addressing customer pain points and then marketing the heck out of its solutions.
A big problem for users buying mattresses was finding the right fit. Now I don’t know about you, but I’m very particular about my mattress. After all, I spend a great amount of time in it, so if it’s up to my level of comfort, I don’t want it. However, before Casper, the only way to buy mattresses was to go into a huge store, look around, sit on a few mattresses for fleeting seconds, and make a decision, and pay a high delivery cost for the mattress to be delivered to you. However, to really get the comfort of a mattress, you need to try it out for several days. And this is exactly what Casper addressed.
Casper decided to sell just one type of mattress straight to the customer’s doorstep. They’re allowed to try out the mattress for 100 days and can return it if they don’t like it. So basically, no commitment is necessary.
Casper made some major marketing efforts that led to their success. Initially, they only focused on two places: Los Angeles and New York. These are the largest states in America so to appeal to their populations, they started using IRL advertising on subways.
But where Casper really succeeded in DTC marketing was with its use of influencer marketing. The brand paid people from micro-influencers to Kylie Jenner to post ads on their social accounts. After Jenner posted a video unboxing her new Casper mattress, the brand saw sales double virtually overnight.
In their very first email, they capture the user’s interest with a warm message, letting them know of all the comfort they provide including free delivery and returns, and a 100-night free trial.
Barbox, a subscription box service for dogs launched in 2011, and has seen immense success ever since. With over 10 million boxes shipped, the company attracted an industry worth almost $86 billion. Barkbox offers one product only, and that too on a monthly subscription: a box containing curated treats, toys, and other products for pampered pups.
Barkbox gained its fame using social media, and without the need to pay influencers for it. The company relied on word-of-mouth to help it grow, with many influencers sharing content of opening a Barbox with their pets. The videos aided in the success of Barkbox as users saw how fun it was to open these boxes with their pets. And to this day, it’s one of the biggest drivers of their revenue.
Bombas started with a product that was extremely hard to sell at a higher price point that they had. Their product was engineered with a honeycomb grid support system in the arch and a reinforced blister pad built into the heel. However, with such features, the product was priced at almost $20 per pair which is a very high price range for a sock.
So how did they manage to make space for themselves in the market? Through their business values which ultimately become a marketing tactic. They created a strong mission-driven brand with its buy-one-give-one model that gives one pair of socks in charity for each pair bought. This appealed to the socially conscious shoppers that like to associate themselves with brands that are actively sustainable and charitable in their business practices.
In addition to its branding strategy, Bombas also did some offline marketing as they appeared on the NBC reality series Shark Tank in 2017. This gave them a boost in awareness and sales, regardless of not striking a deal with the Sharks.
4. Warby Parker
Eyeglasses were way too expensive for the average user as Luxottica held almost a monopoly in the industry. They had a typical B2B model and owned companies such as Ray-Ban, Oakley, Lenscrafters, Pearle Vision, and Sunglass Hut. Users needing glasses had just one option, and it was to go to their nearest optometrist’s office and pay hundreds of dollars for eyewear.
This is where Warby Parker came in and changed the whole game. They opted for vertical integration as opposed to horizontal integration. So instead of outsourcing different parts of their supply chain, their fully controlled their entire supply chain. They designed their own eye frames, removing heft added costs of licensing which would be passed down to the end consumer.
They set up an online store and started selling through that store. This removed the cost of setting up a physical store and paying for monthly utilities and also allowed them to reach a higher audience. They controlled 100% of their customer experience which has led to lasting customer loyalty to their brand. And you know what helps them retain customers? Their whole model.
Customers are allowed to select up to 5 frames that they’ll receive via mail- shipping costs included, and try them out for a certain period of time. Once they’ve made up their minds on which glasses they would like to keep, they place their final order online. Customers can return all orders within 30 days.
Warby Parker saved costs of physical stores and now put them to better use by having a huge Customer Experience team to cater to each consumer’s needs. By engaging directly with the user due to the D2C model, the company is able to gather crucial insights into the customer experience and analyze their behavior. This helps them improve future customer experiences.
Source: Warby Parker
5. Dollar Shave Club
The razor industry was controlled by giant Gilette, which if you remember, didn’t cost much initially when buying just the razor. However, the replacement blades were an expense that just wouldn’t end for the consumer. But there was nobody in the market to change that or challenge it.
That’s where Dollar Shave Club came in with its D2C subscription model. Consumers get razors directly from the company through recurring deliveries. And we know, subscription models for razor blades? Well, it’s genius. Shaving is a daily activity for many, so it makes sense to play a set amount once and then have razors delivered to you for the rest of the month, or year
This low-cost, logical approach has only been possible due to the D2C model allowing Dollar Shave Club to cut off its supply chain costs and sell cheaper razors directly to users.
DTC Marketing: Increase Sales in 2021
As the online market becomes more saturated, you need better strategies to stand out and increase conversions. Stay up-to-date with market trends and constantly monitor how you can reduce costs and reach your customers in the best way possible. Check out Apimio if you’re looking to create better product experiences for your customers, or speak to a professional today.