Direct-to-consumer (D2C or DTC), a modern ecommerce business approach.

Let’s start this with a quick question:

What’s the basic idea comes up in your mind, when you hear “modern ecommerce business” and or Mobile / Digital audience?

Let’s say, “the conventional method of selling products or goods which starts from the manufacturer and reaches to the end customer, crossing several phases is what we generally consider as “traditional” or “orthodox” business process.”

Now the next question is; with the introduction of trending business models like D2C (Direct-to-consumer), what sort of exciting changes are retail products manufacturers ready to witness?

What is D2C and how is it different from a generic ecommerce business model?

The abbreviation of the term D2C, direct-to-consumer explains a lot about the definition of this business model. When the manufacture meddles between multiple intermediate stages before reaching out to its end customer in a standard business process; D2C business model allows the manufacturer to directly reach out its customer, either by levering your existing middle man or building completely a new solution which will give you power not only to sell directly to consumers but a medium to understand your consumers fully.

Well, isn’t it brilliant?

But like every innovation that comes with respective pros and cons, D2C also has its own set of challenges and benefits. Though the benefits are encouraging various ecommerce brands to upgrade themselves with D2C, along with their existing standard business model, certain challenges of D2C are creating some confusion among businesses.

D2C business model: A smart upgrade or a tricky change?

When most of the manufacturers are well-aware of standard eCommerce business models like B2B, B2C and B2B2C (marketplace), etc. being adopted widely and globally, from ages; the current era is buzzing about D2C business upgradation. Of course, it’s nothing an alien term being heard for the very first time (Apple is an established D2C brand), but several businesses are going gaga with loads of queries, like;

• How does this D2C work in my ecommerce business?
• Will D2C generate more ROI for my brand than the conventional business method?
• D2C implementation is an effective decision or just a trend everyone is following?
• Do I need to start over my digital business from scratch while adapting to D2C?
• What if I fail to deliver the best to my consumers?
• Which factors should I focus on during the D2C business add on?
• Will this add on bring better or worse customer experience for my business? And so on.

Manufacturers coming up with all such queries is quite an obvious reaction. Because when the manufacturer used to rely entirely on its intermediate phases like wholesale, distributor, retailer to reach out to its consumer without worrying about the logistics and rest hustles, with D2C added on the manufacturer will bear an additional responsibility of getting the products delivered to its consumers, directly.

These are certainly some sensible changes which we are seeing in the era of several business models. And, this needs to be taken into account for further improvements. Right?

D2C: A win-win for both the Manufacturer and the Consumer:

Now let’s hop on to discuss end-to-end emerging benefits of D2C for both the manufacturer and consumer. It would help us answer all the above-mentioned questions or queries people are coming up with.

What does a manufacturer get via D2C business model;

• Instead of juggling through retailers, a manufacturer can directly interact with its consumer, which helps to set up a good seller-buyer relationship between the manufacturer and the consumer.
• Proper maintenance of an omnichannel business process, where the consumer can land directly on an active and functional page of the manufacturer using every channel.
• Instead of bulk selling and purchase, D2C allows manufacturers to target individual products one by one with needed efforts
• The manufacturer gets a clear idea of its market to penetrate and audience. With this it can keep track of audience activities, and this analytics helps the business to cater for customized services.
• When a manufacturer holds all the relevant details about its consumers, their interests and its on-demand products, it becomes easy to establish brand recognition and add on to customer retention.

What does a consumer get via D2C business model;

• With better customer experience on a manufacturer’s digital site, consumers feel secure to share their personal information (details filled in during sign up, logging in, register, subscribe, enquiry, etc.)
• With D2C, a consumer can get an opportunity to explore a customized platform which enables secured payment gateway. This looks more reliable to a consumer and encourages them to take potential revenue-adding actions.
• A personalized site of a brand will emphasize more on giving customized experience to its customers. That’s why most of the consumers prefer shopping from a brand’s website(D2C) rather than going through a retailer’s site, because a brand will give better product description, the products will be authentic, moreover a customer can have first purchase perks (like discounts and coupons), hassle-free payment and easy return, exchange and refund, etc
• Consumers can easily track details of the purchase done and reach out to the manufacturer without juggling through retailer sites, which bonds manufacturer and the consumer closely.
• If the D2C site of the manufacturer is functional catering smooth customer experience, Shoppers or consumers feel more convenient to visit a brand website than a retailer’s site (like Amazon, Ebay, etc.)

When there exist multiple aspects of D2C business model and its added benefits, we strive to evolve more in terms of business ideas to benefit two end elements of the channel i.e., Manufacturer and the customer.

For a detailed discussion about how to set up a D2C business along with your existing business model or start your customized brand platform from scratch, or anything you want to know about trending D2C, we at Techouts recommend you to stay tuned to our next blog or reach out to us for further assistance