eCommerce

Brands Go Direct To Consumer Online: Now What?

How Brands Can Navigate New D2C Opportunities

Bringing a brand directly to consumers over digital channels was an option to consider in the pre-pandemic world — but the question for brands today in our radically digitized world is not if, but when, according to sticky.io Chief Operating Officer Ro Bhatia.

“What brands should be thinking about now is basically how to double down — triple down — on their direct-to-consumer offerings,” Bhatia told PYMNTS. “They have to be creative. They have to optimize every touchpoint that the customer has with their brand.”

He said that means all brands must become omnichannel in today’s world.

“It’s not just about being at Target, or being at Walmart or being at Costco,” Bhatia said. “It’s also about being at all those channels plus being on Amazon — plus having your own offering, plus being on social channels that the consumers are interacting with.”

That’s a big shift for some brands, but a necessary one, he said, because consumers have shifted their buying habits, and brands that want to stay relevant need to shift with them.

But to do that, brands need that data collected across multiple channels that direct-to-consumer (D2C) relationships can provide.

“In some ways, the current crisis is a blessing in disguise … for brands that have always wanted that data,” Bhatia said. “They always wanted to have that direct relationship, but what do you do when you have your brick-and-mortar retailers that have been successfully selling your products for so long?”

The answer to that question, Bhatia said, is to have “a multichannel approach. You have to work with your brick-and-mortar relationships established for many years as part of a greater whole in developing that customer relationship.”

Reimagining How Brands Relate To Consumers

Research shows that more than half of consumers have recently experimented with a new brand or product while whiling away the hours at home amid the pandemic.

Bhatia said he knows firsthand why that is. Like many consumers, he ended up trying out new brands during the initial lockdown period when some of his favorite products were sold out and back ordered on Amazon.

“I had not tried them before, but they wowed me,” Bhatia said.

Even with consumers no longer forced to try new things by necessity, many are more willing to experiment with new things and let themselves be wowed by new options, he said. That means brands have an opportunity to gain customers in the new world of customer loyalty, as it’s not a “one-and-done” situation anymore.

But he said brands also have to keep working at building and earning consumer loyalty lest competitors poach their current customers away.

“Every brand now has work cut out for [itself],” Bhatia said. “Loyalty can’t be demanded. It has to be earned.”

Thinking Beyond The Shopping Cart

One thing to work on is minimizing cart abandonment.

While it’s hard to imagine now, the digital shopping cart was the hottest big-ticket innovation in commerce 15 years ago. Bhatia said everyone was looking to build the better cart — and bragging about their ability to do so.

But now, a cart isn’t much of anything, and a nice-looking eCommerce site that simply slides out a shopping cart is no longer all it takes to have a good checkout experience. In fact, Bhatia said the data shows that consumers abandon their carts without closing a sale nearly eight out of 10 times.

That can be because a transaction goes too slowly, the checkout requires consumers to input too much information or something else makes the process slow and clunky instead of smooth and frictionless, he said. And the margin between those two consumer experiences is often slimmer than merchants perceive it to be.

For instance, Bhatia said the latest research shows that if a brand can cut checkout time to 2.4 seconds from 3.2 seconds, the conversion rate goes up by 27 percent — “a pretty incredible difference.” He said brands must capitalize on such differences if they want to remain a relevant part of customers’ lives.

Collaborating With Retailers Instead Of Competing

Bhatia said one concern for brands about selling D2C has been that doing so will damage a brand’s wholesale relationship with its retailer partners. But he said that branching into D2C no longer needs to mean competing with retailers but can instead mean collaborating.

Brands can differentiate their D2C offerings from what’s sold in stores, he said, or they can partner with retailers on fulfillment. They can even share customer data to help retailers optimize their own strategies.

After all, Bhatia pointed out, brands and retailers have the same goal in the end: converting customers and keeping them coming back for more in the future — all in a landscape that’s suddenly more competitive than ever.

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