How DTC Brands Will Change E-commerce in 2021

24 January 2021

DTC brands in 2021

The year 2020 was the most prominent peak point in e-commerce history. While brick and mortar stores experienced difficulties because of the lockdowns, each individual had to figure out a suitable shopping option. Many of us found the solution in online shopping. Staying safe and ordering a product with a few clicks from the comfort of your home appears to be the best alternative so far. Manufacturers also had to catch up with the new trends and turn into direct to consumer retail. So in this article, we will talk about how DTC brands will change e-commerce in 2021

These days, being a retailer in the dynamic and fast-growing ecosystem of e-commerce is not a simple job. Keep in mind that this business is a ‘battlefield’ where all the sellers compete to out-stand the others and potentially lure more clients. Taking advantage of the newest can help you stand out in the marketplace and make the job less effortless.

What follows to learn here? We will reveal direct-to-consumer e-commerce, how it works, and why it is crucial in today’s post. The information we are about to share with you will make you understand the DTC and help you find the correct individualized steps for your store. Hence, your brand name can rank up next to the leading DTC brands in e-commerce in 2021.

How Will Manufacturing Business Models Change in 2021?

With the rocket growth of e-commerce sales, manufacturers have to increase productivity to please the buyers’ demand. The key to improving your manufacturing model for the new 2021 is to digitalize the process. Adopting artificial intelligence, combined with IoT devices, is the key to digitalization. Monitoring each step of the production process will allow you to:

  • Reduce the cost of the manufacturing process
  • Produce more products for less time
  • Reduce the chance of human mistakes and raise the products’ quality

What is Direct-To-Consumer Retail?

PhoneLoops. Example of a DTC Brand

Example of a DTC brand. Phone Loops. Image Credit: www.phoneloops.com

Direct-to-consumer (DTC) retailers are on the rise, and the e-commerce industry is learning how to cut the middleman. Instead of selling products through third parties, every brand owner can sell to consumers directly. Thus, every seller can establish a personal and interactive customer relationship and collect data. Getting rid of the middleman will allow you to gather personalized information for your target group by yourself. Hence you can offer irresistible call-to-action offers created for the exact individual.

Why Should You Switch to the DTC Model?

Every small or medium manufacturer can become a direct-to-consumer retailer. Switching from an e-commerce retailer to a direct one has many benefits.

  • By switching to a DTC model, the selling process will become more straightforward because it will involve only you and the buyer in it.
  • Removing the third-party distributors will allow you to offer the product or service you provide at the lowest possible price. Each retailer that resell products puts a surplus price to earn a profit.
  • The most significant benefit of going DTC is the relationship with your clientele. As an independent retailer, you will communicate with your customers, and with their feedback, you can solve their problems in no-time.
  • Given the better customer experience, you can boost your brand awareness and build long-term loyal clients.
  • Direct contact with consumers also leads to a more significant conversion rate for brands that invest in marketing and better customer service.

How DTC Began to Trend in E-commerce?

foot cardigan. example of a DTC brand

Foot Cardigan. An Example of a successful DTC brand. Image Credit: www.footcardigan.com

The DTC model dates back to the times when modern transportation and electricity weren’t even a thing. But it became trending in the late 1990s. Since then, it has referred to innovative online retailers. The internet made the model as popular as it is nowadays. Now one can choose between a variety of goods from any part of the world. Shipping is not a problem with modern logistics. And that’s when DTC comes in handy! For example, a company located in China can offer its services and products worldwide. In this case, the customer can order the product from the manufacturer and receive it in the delivery process’s mentioned time-space.

Striking Example of DTC Brand

Nike is one of the brand names for sportswear known around the world. The company started its DTC store in 2009, and the revenue has steadily grown since then. In the chart below you can see how the income of the brand grows each year.

Nike statistics. Example of a DTC brand

Image Source

Becoming more customer-orientated than product-orientated retailer will have its benefits for the revenue. Taking an example of such big names as Nike can help you find your marketing strategy and develop it further.

Why Consumers Value the Direct Approach?

In a direct-to-consumer store, you have full control over the buyer’s journey and so need to create a first-class customer experience. If your business is taking a direct e-commerce approach to consumers, your customer audience is crucial to your e-commerce business’s success.

People understand their particular importance as customers and feel that brands should speak to them. By getting to know their customers better, DTC brands can build a relationship with people associated with the brand, not the product or service, but also with the company. Like this, you can create a trustworthy brand name.

How can a DTC Brand Succeed?

The top-quality of every DTC brand is the relationship built between the brand and its customers. When looking into a new buy, you will check the reviews. And if they’re mostly positive, you’ll buy the product. Thus, to increase e-commerce sales in 2021, you will need traffic but also positive feedback. Each time an issue appears, a customer’s personal touch will prove to the new ones you care about their journey.

Who doesn’t like being taken care of? Taking care of your clients’ satisfaction will make you preferred in the marketplace, making you the top choice among other retailers in the niche. The key to success in such a complicated and competitive business is continuously improving the customers’ experience and guaranteeing the best potential deals.

Use Social Media in Your Favor

DTC Brands on Instagram. Phone Loops

Micro-influencer marketing done right by Phone Loops. Image credit

Being adaptive in an e-commerce business is vital. Having a social media presence can have countless positive benefits.

  • Lately, the most common usage of social media platforms appears to be for advertisement. Starting an ad campaign in front of such a big audience will give you a head start and engage new customers. Collaborate with micro-influencers and social media creators to craft authentic content that will serve as social proof and will drive the conversion of your ads. For example, a highly successful DTC brand, Phone Loops, collaborates with 200+ micro-influencers a month to generate content and drive sales.
  • Having an active profile (online store) on some of these platforms can enhance communication and strengthen the relationship between you and the buyers. Being in touch with your clients and receiving their reviews will grow your brand awareness and improve customer experience.
  • Last, but most important! Social media is the key to offer a personalized experience to each individual. Such platforms as Facebook and Instagram are well-known as ‘gold mines’ for data gathering. Most people share their personal information or intentions from which retailers can benefit use it as social proof or for sentiment analysis.

Take Advantage of AI

Have you ever wondered how artificial intelligence can improve your business? AI is one of the hottest topics in 2021. This is thanks to its varied range of appliances in almost every sector. Nowadays, we can find artificial intelligence in health care, manufacturing, security, and many more. Adopting AI in DTC e-commerce can help you interact with the customers and answer some frequently asked questions. Artificial intelligence-powered devices and robots can increase your manufacturing process’s productivity and track your storage capacity.

Embed Recommendation Engines Into Your Online DTC Store

In the present time, living in the era of technology, embedding a voice and image search engine will make your e-commerce store preferable to the others. Software and home appliances manufacturers are already using voice assistants to simplify the search process and execute commands. The brightest example of this refers to our smartphones. We can find a song or a product by merely telling the voice assistant what we are searching for. Sometimes, depending on what assistant we use, it’s not needed to know the exact name. Describing the thing we are exploring with proper keywords may lead to the desired result.

Increase Sales by Selecting the Right Keywords

But increasing the sales doesn’t come only from customer satisfaction and quality products. There should be a way for one to discover your products. And the best method is using SEO for DTC that ranks your website above others in search engines. Have you thought about deep tagging? Nowadays, experts use different software to explore synonymous keywords. They explore not only keywords but analytics of searches. For example, we can search a keyword in google X times. A startup business will prefer focusing on keywords that are not among the top searches as they will not rank high. While a developed one will use the ones with the most searches. Understanding the deep tagging and optimizing the content will surely increase the traffic and, thus, sales.

Three Reasons DTC is the Future of E-commerce

The rapid evolution of e-commerce gave a chance to many retailers to switch to the DTC model. Here are three reasons successful companies are switching to direct e-commerce approaches. DTC is not a passing trend, and every retailer should think about taking the next step to improve their business in 2021.

  • First

Most consumers search for a particular product at the lowest possible price. Selling directly to the customer, removing the distributors allows every seller to offer the products at the best price. Like this, you will be one step ahead of the other marketers and help you take control of the price war on the market.

  • Second

Being an independent DTC trader will allow you to communicate with your customers freely. As we mentioned, getting to know your core audience and gathering data about them is the key to success in e-commerce. For example, Amazon takes the top place of the DTC retailer. This is thanks to the enormous database they have gathered over the years. Thus the e-commerce giant can present personalized suggestions for the next buy.

  • Third

Building your own space in the marketplace may be difficult, but the benefits will come in shortly. Whether you are a small to medium-sized brand or starting from zero, using social media platforms can drive traffic through your store and build brand awareness. Working with no third party merchants won’t be easy at first, and the sales may not be the desired ones. But the changes will be visible after a good ad campaign, and what better place to start than social media platforms?

If you feel skeptical about DTC e-commerce, the graph below may assure you that this is the right trend to follow in 2021.

2017-2021 DTC sales statitics

Image Source

Summary

Becoming a customer-centric retailer is nothing new to the e-commerce landscape. Most of the well-established brand names have already switched to the direct-to-consumer model, which seems beneficial. Yet, it is never late for improvement and taking fresh approaches to your business. Following the right steps for your marketing strategy and taking it further will improve the conversation rates. Switching to a DTC seller means that you should focus on the customer experience and improve it continually. We strongly believe that this post will support many retailers seeking to build strong brand awareness and rank up next to the leaders in 2021.

 

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