Best practices for Direct-To-Consumer brands
You have a special product in mind that you want to produce and sell? Or you’re already doing that?
The DTC business model (direct-to-consumer or direct brands as they’re called by some experts for short) is gaining traction these days so you’re on the right path. You own your customers, control their whole experience journey and get all the profits.
But we know it’s not easy when others are using ready solutions like dropshipping and marketplaces. That’s why in this article we put together the the top things making positive impact for the many direct-to-consumer brands we work with.
Related: How to beat Amazon
The winning edge of direct-to-consumer
The best thing about DTC business is that you have full control over your communication.
Being present from beginning to end gives your brand a whole new dimension compared to online stores that never see the products they sell or don’t take care of the post-purchase experience.
As a direct-to-consumer brand, you solve a problem for your target group, stand for something and are able to get that across. You have that direct access to your customers that changes everything.
So what we see always brings the most value for direct-to-consumer brands?
1. Focus on long-term growth
One study of the biggest DTC brands revealed that they all are in for the long game and would not compromise their relationship with their customers for short-term revenue.
They recognize that growth comes with happy customers and happy customers are nurtured. Success doesn’t happen overnight.
We’ve talked about profit vs revenue and why profit is the only thing that matters if you want a healthy business.
We also see that our direct-to-consumer clients aim at creating loyalty and retaining their customers. One-time buyers are not their best fit and they put their efforts on nurturing long-term relationships instead.
2. The consumer-brand relationship
What successful direct brands have and traditional offline or online retail lacks is the customer-centricity. Put your target consumer and the ideal product at the heart of your strategy and make all decisions from there.
Everlane shares their pricing model for “radical transparency”
You’re in the unique position to own the whole customer journey and communication so you can build your business on the relationship with the customer.
Related: How beauty brands stimulate customer loyalty
Share your journey and values
You have more touch points with your audience than traditional brands from the past. Your product answers specific needs and stands for what you believe in.
Don’t be afraid to be transparent and to take your audience on your journey. If you have a market fit, those people share your values and will engage with your brand as it develops.
Native, a natural deodorant brand that recently got acquired by P&G for the mind-blowing $100 million, involved its customers in the formulation of the product until together they created the perfect fit — at version 24!
Read the whole success story of Native
Care about feedback
Native used a rigorous feedback loop to improve step by step. People stayed with the brand and love it for its commitment to making the best product.
Use your direct connection to your users and listen to what they say. The lack of middle men also means you’re free to directly improve in every aspect because you’re in full control.
Which brings us to…
Customer relationships are always 2-way
In contrast to ecommerce businesses, looking for short-term sales and pushing 1-way communication, direct brands are customer-centric and looking for mutually beneficial relationships with buyers.
Short-term vs long-term in ecommerce
The core idea behind direct-to-consumer is more of an experience than just a product so the whole customer journey is a friendly exchange that gives value.
You own your messaging, positioning, channels and data — everything you need to reach the right people with the right communication. You have the platform to build your brand as you want it to be and you will directly be exposed to customer’s response.
Why is it awesome that you own your data?
Because you can make decisions faster and more effectively.
No chain of reaction, no additional parties to slow you down — you have first-party customer data, as it should be, and you can act on it: adjust campaigns, iterate product, change variants, answer questions, tailor offers and communicate personally with a client if need be.
All clears the way to better customer experience and higher loyalty.
Your customer data is ready to give you retention.
3. Strong brand identity
An innovative product calls for unique brand identity.
It’s smart to take small steps at the beginning of your venture and find your own voice because it might turn into your biggest differentiator.
We all know The Dollar Club’s promo video. Why?
Because it shows character and makes the brand memorable. It’s authentic. Direct-to-consumer brands eliminate the middleman and shorten the distance — authenticity draws people in.
So tell your story, talk about what you believe in, use the language of your customers and bring your brand to live.
There are too many faceless online shops out there that people cannot tell apart. If you want loyalty, make sure people recognize you.
Plus, when you stand for something, when you have a bigger mission that people identify with, you won’t need to compete on price. And that’s big for your margins and long-term profitability.
4. Product quality
If you’re doing DTC, you probably started out to fill a gap on the market. This means a better product than what’s available.
Saddleback Leather started out of the need for a sturdy bag for books
Mass and cheaper options will always be there for the price-sensitive consumer, but product-driven online businesses usually are after the quality-oriented buyers.
And so the quality of your products is essential. You have to be delivering what you promise consistently. Otherwise, you have no differentiation.
Look at the infamous startup Juicero: it offered a juicing machine and ready packages of fruit and veg chunks to squeeze with it. However, the company closed down when the public discovered the machine was not better at squeezing the packets than the two hands of a human.
With direct-to-consumer approach, you have an opportunity to stand out when your product really solves problems:
- Warby Parker about the affordability of eyewear,
- Casper about trying out a mattress before buying
- No label about affordable but high-quality clothing for men
All those companies stand by their mission statements and make a product worthy to put their name on.
If you’ve chosen the path of DTC, we salute you — it’s a work of passion. And that’s why we believe it’s the future of product creation and selling.
