How To Upscale Your D2C Brand in 2021

Posted on January 20th, 2021
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How To Upscale Your D2C Brand in 2021

In India, the direct-to-consumer (D2C) brands could be looking at a mammoth amount of consumer opportunity closed at USD 100 billion in the coming years. The numbers are not just secured by online marketplaces and growing vendor aggregation brands, but a promising trend in the D2C brands' spectrum is also being witnessed by the eCommerce industry and the consumer landscape.

According to estimations by Unicommerce, there has been a 65% increase in brands launching their websites in India, leading to significant growth in self-shipped orders. Simultaneously, D2C brand websites have recorded an increase in the order volume by 88% as compared to eCommerce marketplaces that stand at 32%.

The numbers clearly state that the Indian D2C brands market now has an exciting number of top players in the game. Brands like Licious, LensKart, Epigamia, Zivame, BoAT, HealthKart, Wow Skin Science, MyGlamm, SUGAR Cosmetics, Country Delight, and IncNut are some names that are leading the online sales with an established presence in the retail arena.

D2C brands have numerous advantages, both in terms of management and growth. Being consumer-centric in nature, D2C brands already have an upper hand when it comes to customer satisfaction and quality delivery of products. To fuel the growth further in 2021, let’s take a look at some ways to upscale your D2C brands.

  1. Understand the D2C environment

The D2C scenario in the western parts of the world is a little different when we look at D2C brands’ growth. For example, brands like Casper (selling mattresses online) and Warby Parker (online eyewear company) became popular instantly and gave a rise to intense competition. A large number of brands started leveraging the D2C approach to achieve the same results, ranging from cosmetics to clothes, healthcare products to personal care products, everything could be found online. The sudden emergence of these brands increased bids for online advertisement and a challenge to acquire a loyal customer base.


However, in developing Asian nations like India, the D2C landscape is dynamic and is still picking up pace. Currently, India is witnessing its first generation of online shoppers and the stigma associated with fault online products is washing away. Hence, there is an increased demand for top-quality products, especially in the brands that cater to a niche, making it easier for D2C brands to expand their footprints with precision.


  1. Establish a Customer Community in the early stages

Mapping the success of existing D2C players, regardless of the location and the type of products they are selling, will help startups and functioning D2C brands to find new trends. Every well-established D2C retailer has a strong customer base because having a loyal community is one of the key USPs of any D2C business. Traditional retail brands lack a one-on-one relationship with their customers that restricts them from getting in-depth information about their customers.


As customer interaction is paramount for D2C brands, they can enhance the engagement by forming a loyal customer community. For instance, popular shoes and athletic brand Nike has adopted the D2C approach and created a community of fitness enthusiasts by launching the Nike+ App. Brands can also leverage personalized communication and automation by using D2C tools available in the market for maximizing conversions and personalization.


  1. Concentrate on Vertical Integration

Higher profit margins were once considered as an innate advantage for D2C brands, but the scenario looks a bit different now due to increased competition. Many established brands enjoy the benefit of acquiring higher profit margins through borrowed supply chains, but they are also competing for customer acquisition cost (CAC). The lack of middlemen has also allowed D2C brands to enjoy the same benefits. However, as the CAC and individual costs are going up, the higher profit margins are getting compromised.


One solution for this problem is vertical integration, which means D2C brands can gradually scale in-house manufacturing, integrate customer-acquisition automation, improve logistics, and distribution. D2C brands already have their personalized products and the niche for an added advantage. To get the profit margins back on track, they can optimize their back-end processes to eliminate the need for contractual manufacturing and outsourced marketing. Focusing on reducing the CAC will also turn out to be viable in the long run.


  1. Leveraging Omnichannel Marketing

Having an omnichannel presence and using it for personalization holds immense importance in the D2C eCommerce landscape. Retailer marketplaces and aggregators like Amazon use their wider presence, proper listing, and brand name to grow stronger. These huge retailers lack two things, direct consumer communication, and a niche. For D2C brands, consumer interaction and having a niche will always act as significant advantages. Combined with omnichannel personalization, D2C brands can also achieve a wider audience and better reach.


Omnichannel personalization uses email, push notifications, SMS, banners, and other advertising channels that help the brand to spread its footprint. Uniform brand messaging across various channels and accumulated customer data will allow brands to gain a competitive edge in the concentrated D2C environment. Additionally, omnichannel personalization also reduced CAC and significantly increases sales and cross-platform communication.


  1. Automate Marketing Operations

As the digital landscape is becoming denser by the day, the customer data is also getting segregated. Manual intervention for handling sensitive data gives an open ground for inaccuracies, inefficiencies, and minor losses. Here, marketing automation can be used as a solution.


Automating SMSs, emails, push notifications and other communication channels enhance reliability and scalability for the D2C brands. Automating marketing means that whenever a customer clicks on a product on your website, they will get an email, a text, or both for offers and deals, acting as a simple nudge for sales conversion. Automation also reduces manual intervention at the back end and allows brands to upscale operations without hesitation. Customer data and other behavioral analytics can be accessed directly to make well-informed decisions and required changes.


Bottomline


To establish a successful D2C brand, it is vital to focus on the current scenarios and changing dynamics in consumer demands. Basic strategies combined with the latest innovative ideas will help D2C brands to achieve a larger customer community, better profit margins, and an unforgettable brand name. Leveraging tools for automation to enhance business operations will allow the brands to concentrate on improving their brand messaging, product portfolio, and user feedback for higher growth and popularity.

Category:
Best Practices

Posted on:
January 20th, 2021