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Direct-to-Consumer Model: a New Evolution in Business
Competition is the name of the game, no matter what industry you’re a part of. There are more and more brands, which means more and more options, which leaves you with less and less shelf space and opportunities for your brand to stand out. And as innovations continue to enter the market, companies need to analyze how they can structure or restructure their own brand so consumers are aware of the unique value being offered.
Customer Is Always Right
An IBM study showed that 90% of consumers are looking for improved personalization; in other words, they want the products to speak precisely to their needs and wants and to fit in with their overall lifestyle. As a brand, if you are hoping to capitalize on this shift in consumer expectations, then a direct-to-consumer model is the right approach.
The proliferation of the Internet and social media has intensified the need for brand engagement. Consumers more than ever are looking to be part of an experience just as much, and even more so, as they are looking to simply purchasing a product or service. The most effective way for a brand to create an experience for a consumer is to do it themselves.
Rethink Retail
The retail model is set to accomplish one thing, and that’s sell. Retail catches consumers in a late stage of their purchase cycle and both cares and does little for communicating a brand’s story. By the time a consumer enters a retail store, their minds are all but made up on what they will be purchasing.
Among one of the benefits of a direct-to-consumer model is the ability for a brand to affect the consumer at early stages of their purchasing cycle. Through a comprehensive marketing approach, which could include content marketing, both digitally and otherwise; direct mail; guerrilla marketing; and other tactics, a physical retail space can be used to add to the storytelling experience and further instill brand loyalty rather than simply being a place for purchase.
Take Hold of Your Brand
Digital platforms have made it so brands no longer need to think of themselves as strictly manufacturers or wholesalers. Instead, brands can reinvent themselves as vertical retailers with complete creative control of their product and the supply chain. The focus now should be direct communication and engagement with your target market so you can build that personal connection consumers are now expecting and that will present opportunities to clearly articulate your brand’s vision and purpose.
Taking full control of your brand also goes a long way to strengthening brand image and having a more precise picture of what consumers needs, wants, and concerns about your brand are. The current retail model presents this information through the lens of a retailer, which essentially provides sales figures. Brands need to know not only who is purchasing their goods, but both the positive and negative aspects of how these consumers are interacting with their products.
Every company will have to come to its own decisions on whether or not a direct-to-consumer model is appropriate for what they hope to accomplish. And if they do decide to make the shift, it will have to be gradual and done with a certain sensitivity that bears in mind that the retailers they would hypothetically be leaving now theoretically become competitors.
Macromark deals with many organizations who operate under the direct-to-consumer model and we use our resources and experience to help them reach their goals. Times have already changed and many businesses are seeing the need to adapt to the current climate. It won’t be easy, but the direct-to-consumer model might make perfect sense to take your vision to the next level.
Source:
Randall, G., “Why brands need to move to a direct to consumer model,” Econsultancy.com, February 13, 2014; https://econsultancy.com/blog/64317-why-brands-need-to-move-to-a-direct-to-consumer-model/.
David Klein