Practicology is now Pattern

By Joanna Perry | Global Head of Marketing

Whether a D2C site is designed to deliver a better brand experience than other online sales channels, or to ensure there is adequate online distribution in a market, many brands are investigating whether they should be selling direct to consumers online.

We have conducted several pieces of work to help brands with just this piece of analysis, often as part of an internationalisation project to examine their total online routes to market in a selection of new or emerging markets.

In addition, we have published our first study into D2C site best practice having conducted reviews of 100 global brands’ D2C sites.

The more of the below 10 questions that a brand answers yes to, the more likely it is that a D2C site could be beneficial to enhance a brand’s perception with consumers, and deliver hard commercial benefits.

1. Do you sell products that are non-commoditised, have brand cache or are hard to find?

Brands with limited distribution will obviously find it easier to sell through a D2C site. If you have good brand awareness and a premium or luxury brand positioning, it is also more likely that consumers will be interested in buying direct – particularly if you offer added value through exclusive products and ranges or product personalisation.

2. Do you sell products or product bundles that are economical to ship?

Some products can be challenging to ship - particularly cross-border - and bulky low-value items can also be uneconomical to sell. Analysis of your minimum viable basket size given your products and price architecture will help to answer this question.

3. Would a customer want to buy a basket of items in one checkout from your D2C site, or buy the same item(s) regularly?

See above. If your unit cost is low, could you sell multiple items in a single transaction, sell in bulk or offer a subscription service in order to build a D2C site with a commerical plan that stacks up.

4. Is there a place within your product range for exclusive products and services to add value to your D2C proposition?

Exclusive products, exclusive bundles and personalised products all add value and create a point of different for your D2C site. They also move comparisons with other ecommerce sites away from being purely about price.

5. Could a D2C proposition support your broader product/service innovation agenda?

A D2C site is a great place to demonstrate the innovation taking place in your brand, to a group of customers who are likely to be your best brand advocates. A brand can try out new add-on services, test new products and ranges before distributing them via retail channels. 

6. Do you have, or could you develop, value adding content?

The best D2C sites add value with content that goes above, and beyond just encouraging customers to buy products. Advice on how to use different product categories, recipes, video instructions, online tools and user generated content can all enhance the buying experience, help your site rank in search engine results and give customers a reason to keep coming to your site even if you sell a category that does not have a high purchase frequency.

7. Are you concerned about your brand/product perception being damaged by the customer experience provided by third-party sellers?

As our previous blog post on the subject explains, third-party online sellers - particularly on marketplaces such as Amazon and Tmall, often don't provide a level of customer experience that a brand would like. Having your own branded online destination in the form of a D2C site sets expectations with customers about your brand positioning.

8. Are you concerned about the prospects for some of your established online or offline sales channels/partners?

Store closures, retail insolvencies or simply being delisted by a retail partner can suddenly reduce a brand's distribution in a market. A D2C site reduces that risk and ensures consumer have access to your products.

9. Does D2C make sense in certain markets, or as a strategy to enter emerging markets?

While a brand may be happy with its existing sales channels in established markets, a D2C proposition is one way to enter a new or emerging market. It can allow you to better educate new potential customers on your products and brand, and complement marketplace sales channels in countries such as China. 

10. Do you have an appropriate structure, skills and/or partnerships to support D2C operations?

Without D2C experience within your business, or close partnerships to enable a D2C operating model, then it will be difficult to successfully launch and trade a D2C site.

Practicology regularly advises brands wanting to set up D2C on everything from logistics, ecommerce platform, partner selection, commercial plans, marketing plans, team structure, processes and more.

Successful launches require support from the top down, a culture and structure that enables an excellent customer experience, commercial and brand aims to all be met.

Read the full report into 100 brands' D2C sites now.


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