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26/02/2019 Luke Hilton

DIRECT TO CONSUMER SUCCESS

It’s no secret that consumers have come to expect that they can buy products straight from brands with just a simple click these days. According to one market report, eCommerce sales are expected to account for more than $4 trillion in the US by 2020, making up almost 15% of all sales.

Adding a direct-to-consumer digital sales channel isn’t just a boutique marketing strategy anymore – it’s the new normal. However, if you haven’t set up a clear retail eCommerce strategy yet, don’t panic –  it’s not too late! Starting a project like this isn’t just something that can be completed overnight, and there are a number of factors you need to consider first so that you can do what’s best for your brand.

The benefits of a direct-to-consumer channel

One of the biggest advantages of selling straight to shoppers is that it offers better margins. By not having distributors and other middlemen, brands can now claim the entire difference between the cost price and the selling price. Since you’ll be selling your products at a price similar to that of what bricks and mortar shops would, higher sales margins can be expected.

Another potential benefit of going direct is that it can mean better sales overall. Many consumers now prefer the ease of shopping online to going to an actual store, and even those who do go to physical stores tend to do their research online beforehand. Having eCommerce functionality doesn’t just make things easier for your brand; it makes it easier for your customers to purchase exactly what they want, resulting in higher sales.

Of course, an underappreciated aspect of launching a direct-to-consumer channel is the chance to establish a direct relationship with a customer. The firsthand consumer data gathered through this approach can be used to streamline and optimise their shopping experience, potentially improving brand loyalty and their lifetime value. In addition, the ability to give feedback straight to your brand – as opposed to a salesperson in a physical store who may or may not be personally involved in your brand – means that you can easily and quickly address any issues they raise.

The challenges in going direct

It’s crucial to keep in mind that going direct to consumers isn’t an instant, guaranteed success if you don’t invest in the right infrastructure. Building the right technology foundation is necessary for supporting a customer experience that runs smoothly and predictably. A thoughtful operational strategy is key for your backend systems and logistics to be able to handle order placement and fulfilment, payments, shipping, returns, and customer service. In addition, having the capability to ship single items from a warehouse, as opposed to an entire crate, is something that you’ll need to address.

Providing great customer support is an element of going direct that can’t be overlooked. Remember – your competitors have been doing this direct-to-consumer thing a lot longer than you, so you’ll need to go the extra mile. Your call centre staff will need systems to easily check on the status of an order, check if a product is in stock, process refunds and address customer complaints. Customers expect to be able to contact you via phone, email and Live Chat.. and they should be able to. These are all qualities that can ensure the direct-to-consumer experience is a satisfying one.

Despite these challenges, the benefits of going direct-to-consumer are too great to pass up. By instituting the right technology, practices and partners, you can position your brand to take advantage of this growing demographic and succeed into the future.

Want to establish your own direct-to-consumer sales channel but aren’t sure just where to start? Not a problem! Just drop a line at hello@theplayhousegroup.com.